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Edited Transcript of FHL.OQ earnings conference call or presentation 26-Aug-19 12:00pm GMT

Q2 2019 Futu Holdings Ltd Earnings Call

Aug 27, 2019 (Thomson StreetEvents) -- Edited Transcript of Futu Holdings Ltd earnings conference call or presentation Monday, August 26, 2019 at 12:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Daniel Yuan

Futu Holdings Limited - Chief of Staff

* Leaf Li

Futu Holdings Limited - Founder, Chairman & CEO

* Arthur Chen

Futu Holdings Limited - CFO

* Robin Xu

Futu Holdings Limited - Vice President

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Conference Call Participants

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* Weicheng Tang

Goldman Sachs - Analyst

* Kelvin Chu

UBS - Analyst

* Livi Liu

HSBC - Analyst

* Yiwen Zhang

Bank of China - Analyst

* Husei Qui

GPC Investment Management - Analyst

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Presentation

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Operator [1]

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Ladies and gentlemen, thank you for standing by and welcome to Futu Holdings Limited's second-quarter 2019 earnings conference call. (Operator Instructions). Please be advised that today's conference is being recorded. I would like to hand the conference over to your first speaker today, Mr. Daniel Yuan, Chief of Staff of Futu. Thank you, please go ahead.

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Daniel Yuan, Futu Holdings Limited - Chief of Staff [2]

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Thank you, operator. And thank you for joining us today to discuss our second-quarter 2019 results. Joining me on the call today are Leaf Li, our Chairman and CEO; Arthur Chen, CFO and Robin Xu, VP.

As a reminder, today's call may include forward-looking statements which represent the Company's belief regarding future events, which by nature are not certain and can be affected by factors outside of the Company's control. These statements are based on current plans, estimates and projections and you should not place undue reliance on them.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. For more information about the potential risks and uncertainties, please refer to the Company's filings with the SEC, including its registration statement.

So, with that, I will now turn the call over to Leaf Li. Leaf will make his comments in Chinese and I will translate.

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Leaf Li, Futu Holdings Limited - Founder, Chairman & CEO [3]

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(Interpreted) Hello, everyone. Thank you for joining us today. I'm pleased to report another strong quarter despite ongoing market volatility. On the client side we added over 16,000 net new paying clients during the past quarter and the total number of paying clients hit 165,000, representing 65% year-over-year growth. A large part of this growth was driven (technical difficulty) Hong Kong business.

Despite the adverse effects of recent political events on our online and off-line marketing efforts in Hong Kong, we were still able to increase brand awareness and achieve 115% year-over-year growth in the number of paying clients in Hong Kong. We will continue to leverage our experience in penetrating the Hong Kong market, which was our first target market outside of Mainland China to expand globally.

As we mentioned on our last earnings call, the number of paying clients, client retention rates and total client assets are the three metrics that we attach most importance to. As our paying client numbers continue to demonstrate strong growth momentum, we are also pleased to have retained 98.1% of them on a quarterly basis, which is the highest retention rate that we have seen since 2018.

At the same time, we saw net asset inflows of HKD5.7 billion. Despite the market volatility, our clients clearly continue to entrust us with more and more of their assets.

In May, we officially launched Money Plus, a money market mutual fund distribution platform, in Hong Kong. This marked our initial foray into the wealth management business. Early results indicate that Money Plus has been effective in helping us attract new assets, which, as I mentioned, is a key metric for our business.

Since the end of the second quarter we have also started to offer a number of fixed income and equity funds to clients in both Mainland China and Hong Kong. Going forward wealth management will be an integral part of our business. Through our proprietary trading infrastructure and superior user experience, we have already attracted a rapidly growing group of young, active and affluent millennials to our platform.

Notably, our average client age is 35. Yet their average asset balance at the end of the second quarter was around HKD415,000, which is a much higher level than our peers in the region. In the end, we believe clients are our biggest asset. In that regard, our trading services have laid a solid foundation for our wealth management business.

As our clients accumulate more wealth, become more financially sophisticated, and as we gain a deeper understanding of them, we want to cater to their broader wealth management needs. And for this we are starting with mutual fund investments.

Like we did for our trading and margin financing services, we will surround our wealth management products with news, research and powerful analytical tools, providing our clients with a data rich foundation to simplify their investing decision-making process. We want to empower our clients with thoughtful investor education.

We are still experimenting with our wealth management business, but in time we believe that it can help expand our client acquisition capabilities, increase average assets per client, improve client retention, and provide a more stable stream of revenue.

Now I'd like to provide some updates about our technology investments and enterprise service. In June, we became the first Chinese broker to offer full market-depth for US option quotes. With quote refresh rates that are much faster than our peers in the region, we have and will continue to invest in technology to bring this best-in-class trading experience to individual investors.

Moving on to our enterprise business, we officially launched our new service brand I&E in May to integrate our ESOP solution and IPO subscription services. In the first half of 2019, we acquired 15 new ESOP clients. Among the new additions in the second quarter were Douyu, the recently IPO'd game streaming business, and a number of other leading Chinese new economy companies.

Our ESOP business has successfully handled some of the most complicated ESOP systems for a variety of Chinese tech companies. And we continue to differentiate ourselves with both the quantity and quality of our clients in this area. Moreover, our ESOP solutions have proven to be a consistent client acquisition channel for our Mainland China business.

And finally, on August 12, we announced the appointment of General Atlantic to our Board. We believe GA's extensive experience investing in technology platforms in the region will benefit us as we further build our platform and deliver long-term value to shareholders. So, with that, I will now turn the call over to Arthur to discuss our financial performance.

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Arthur Chen, Futu Holdings Limited - CFO [4]

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Thanks, Leaf and Daniel. We concluded the second quarter with total revenue of HKD260 million, a 40% year-over-year and a 10% Q-on-Q increase. We consider this reasonable growth against the backdrop of the broader market volatility. Let me walk you through the key financial details for this quarter.

Brokerage commission and handling charge income was HKD122 million, an increase of 36% from the same period in 2018. Quarterly growth was a moderate 7%. Total trading volume came down a little bit due to a weak equity market, yet our effective take rate went up due to the expirations of promotion discounts. Brokerage commission and handling charge income contributed to about 47% of our total revenue in the past quarter.

Interest income was HKD114 million, an increase of 31% year-over-year and 6% Q-on-Q. The rise was primarily due to the increase in the balance of the client deposits and improved returns of such balances due to enhanced capital management as well as higher benchmark interest rates in the US and Hong Kong.

Our margin financing and secured lending balance dipped by 1% on a yearly basis but went up 7% Q-on-Q. Interest income contributed to about 44% of our total revenues. Other income was HKD24 million. The 159% year-over-year growth was mainly attributed to our growing enterprise service business. This contributed the remaining 9% of our total revenue.

On the cost side, total cost was HKD64 million, an increase of 6% year-over-year and 4% Q-on-Q. Brokerage commission and handling charge expenses were HKD24 million, an increase of 21% year-over-year and 16% Q-on-Q, which was roughly in line with our brokerage commission income growth.

Interest expenses decreased 21% year-over-year to HKD19 billion, and the processing and servicing cost increased 26% on higher market information and the data fees including cloud service fees as well. As a result, we recorded total gross profit of HKD196 million, an increase of 56% year-over-year and 12% Q-on-Q, which translates to a gross margin close to 76%, which was a record high.

In terms of operating expenses, total expenses were HKD145 million, an increase of 67% year-over-year and 28% Q-on-Q. Breaking down our operating costs, research and development expenses were HKD64 million, up 83% over last year and 19% from last quarter. The rise was mainly due to the continued increase in headcount for our R&D functions where we have been hiring most aggressively.

As of quarter end, R&D personnel account for about 74% of our total employees. Technology creates the biggest entry barrier for our business in our view and we will likely continue to attract the talents as we expand our trading products and branch out into new business such as wealth management.

Selling and marketing expenses was HKD42 million, an increase of 46% year-over-year and 33% Q-on-Q. The rise was primarily due to higher branding and marketing spending, particularly in relation to our new Money Plus business. Our marketing in Hong Kong has turned out to be quite effective, resulting in 115% year-over-year growth in terms of the number of new paying clients acquired in Hong Kong.

G&A expenses was HKD39 million, an increase of 68%. The rise was primarily due to the increase in headcount for general and administrative personnel. At quarter end our total headcount reached 688, a roughly 65% increase from one year ago. As a result, our pretax income was HKD48.2 million, up 30% from last year and also down 21% from last quarter.

Net income increased by 129% year-over-year to HKD55 million due to additional tax allowance for our -- and expenses from local tax bureaus. And as we mentioned on our first earnings call, we continue to expect our full-year effective tax rate will be below 20%. Non-GAAP adjusted income increased by 122% to HKD59 million.

That concludes our prepared remarks. We'd now like to open the call to questions. Operator, please go ahead.

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Questions and Answers

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Operator [1]

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(Operator Instructions). Weicheng Tang, Goldman Sachs.

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Weicheng Tang, Goldman Sachs - Analyst [2]

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I've got two questions, one is regarding wealth management. As Leaf just introduced, you have been starting to sell not only mutual -- money market funds but also some fixed income or other maybe equity mutual funds to investors.

We would like to -- if management could give us an update in terms of the volume of funds has been sold since we rolled out the Money Plus product in May. And also the average fee on those products. And also, if you have some balance, existing outstanding balance of those funds that have been sold to investors.

And the second one is related to the recent Hong Kong situation. I think a lot of investors would be worrying about how this heated situation in Hong Kong will impact our operation. Can management give some quantitative measures or metrics to let us know like since June how our client asset grows or the trading velocity as well as marketing campaign or all of those business activities has been impacted by this situation in Hong Kong. Thank you.

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Arthur Chen, Futu Holdings Limited - CFO [3]

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For number one about our mutual fund product, actually we just launched money market funds in the second quarter. At the end of the second quarter our balance for the money market fund is close to HKD1 billion. And just recently, actually last week, we further enriched our funded portfolios.

In connection with the money market funds we also launched [quite several] fixed income products and also the equity product as well. You can actually see the breakdown of these funds in our NiuNiu platform as well.

I think in the third quarter we will do a lot of new marketing campaigns in order to promote our new service offerings. But having said that, I think the more important thing is we try to leverage our technology to give more deep and more widely education to our users.

In particular, now our users and customers attaching to our platforms have limited knowledge about these new products such as the fund. This is, I think, the areas we will pay special attention in this quarter.

And for the recent Hong Kong social events, I think as you imagine or if you have already witnessed, it creates a lot of the market volatility alongside with the recent Sino-US trade wars, which I think actually on our side we welcome the market volatility, which we think it will accelerate market consolidations and the long-term. As a leading player in the space, we actually will be better off in such market consolidations.

So, in terms of financial impact, I think for the revenue and also for the cost side, so far, we think the situation is quite manageable. Having said that, I think the negative impact mainly relies on the new kinds of acquisitions, particularly in Hong Kong. Because of the recent event, we also intentionally delayed certain of our marketing campaigns because we think -- even we put a lot of marketing campaigns nowadays, it may not turn out to be a very effective channel or effective solution to acquire new clients.

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Weicheng Tang, Goldman Sachs - Analyst [4]

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Thank you. Can I follow up on a question regarding the mutual funds? We're not allowed to open the account on your platform. So, can you give us some more information regarding -- I actually saw on your [research] channel that you officially launched, I don't know how to call it, like fund plus or (spoken in Chinese). So, how many funds and particularly what type of funds are listed on this platform? And is it open to -- like Leaf I think said is it open to all Hong Kong and Mainland investors?

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Arthur Chen, Futu Holdings Limited - CFO [5]

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Sure. In terms of the coverage, I think in the second quarter we are more focused or tailored to the Hong Kong based clients in terms of the Money Plus or money market funds. Actually we now expand the coverage to full of our existing clients; i.e., including the Mainland clients and also the Hong Kong clients as well.

And also, we will particularly enhance our features and functions so that even the financial service professionals, because you guys are not allowed to open a brokerage account -- trading brokerage account. I think it will be very likely for you to open just a fund account in our platform so that we can solve your constraints through our technology expertise.

And in terms of the number of funds we launched, up to now we have already launched close to 10 products, including three to four fixed income products, four equity products and three to four mutual fund products. And I do expect the number of the funds we launched at the end of the third quarter were close to 20. [All the funds] nowadays are just [SFE] recognized products, so it can be offered to all retail clients.

And I just forgot to answer your question before in terms of fee structures, for the money market fund, actually we don't charge any subscription fees. But for the management fees charged by the fund management company we do have certain percentage to -- as a rebate. And for the fixed income products and also the equity products, on top of the management fee rebate, we also charge 0.8% one-time subscription fees in our platform as well.

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Weicheng Tang, Goldman Sachs - Analyst [6]

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Okay, thanks. I will definitely try the fund accounts if we can on your platform.

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Arthur Chen, Futu Holdings Limited - CFO [7]

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Yes, you should. Thank you.

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Operator [8]

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Kelvin Chu, UBS.

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Kelvin Chu, UBS - Analyst [9]

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Congratulations again regarding the launch of the mutual fund distribution platform. Just a follow-up question on that. Can you remind us the key competitive advantages you see with your platform versus key competitors in Hong Kong, which I believe the sales of mutual funds are still mainly conducted by commercial banks now?

The second question is longer-term would you consider launching margin trading solutions for mutual funds, [client] services offered by private banks?

And the third question regarding this platform, just want to get an update regarding any additional costs which you foresee after the launch of this platform? Or should there be plenty of cost synergy with the existing brokerage platform we have?

And then the other question is regarding client mix. I noticed that in the past few quarters Futu's client equity position has been, I would say comparing to your in-force customers, more skewed towards Hong Kong locals. So, plenty of new customers from Hong Kong locals, which contribution has risen to 30% now. I just want to have an idea from licensing on the long-term client breakdown that we should target between Hong Kong and Mainland Chinese. Thank you.

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Arthur Chen, Futu Holdings Limited - CFO [10]

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Thank you, Kelvin. Let me answer your questions. I think maybe I'll address your last question first given it's just purely a number question. In terms of the new clients we acquired in the second quarter, the breakdown is roughly 50% to 50% spreading over Mainland China and also in Hong Kong.

As we recall, in the first quarter -- the clients we acquired in the first quarter, 60% of them came from the Hong Kong local people and the remaining 40% came from China. I think in the long run the percentage of the Hong Kong paying clients will continue to go up as we think this year actually will be the first year for us to pay more attention about clients outside of mainland China.

For the money markets or for the fund distribution compare our platform with other commercial banks, we did some feasibility before we launched our products. I think the major pain points for the Hong Kong retail person nowadays, for them to buy the mutual funds through the commercial banks is, number one, the cost is still relatively high.

If you look at certain commercial banks such as HSBC, Citibank, etc., normally clients need to be charged 2% [subsequently] for the fixed income products and 3% for the equity products versus our charges is roughly 60% to 80% lower compared with their fee rate.

And the second [leg] is the convenience, because when we plug in these money market fund products into their brokerage account, i.e. people can buy/still their stocks. At the same time, they can use the purchasing powers to subscribe the funds in a simultaneous manner.

And also, we spend a lot of efforts in the mobile technology enhancement. So, in particular for this millennial generation, they are -- they can easily use our mobile phone APPs to use these transactions. And definitely in the long term we are considering to put more leverage or do the financings for these fund products as well. I think this is our long-term footprint in terms of our whole wealth management strategy as well.

In terms of the cost, actually I think we don't have increase a lot of new marginal costs alongside this new business in terms of the system set up and also the product development, etc. So, going forward there will be definitely some marketing costs in connection with this fund distribution. But I think in terms of economic model and also the kind of retention and also the new assets these new addressable market people can bring in, these costs will be worthwhile. Thank you.

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Kelvin Chu, UBS - Analyst [11]

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Just a follow-up with that, regarding the source of customers on the mutual fund distribution, will you foresee more of the potential customers would be your existing brokerage clients? Or would you think the launch of the mutual fund distribution platform would also help Futu to acquire a lot of new customers?

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Arthur Chen, Futu Holdings Limited - CFO [12]

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I think actually it will help in both manners. If we look at the numbers for the data in the second quarter for our Money Plus, the initial response of the clients to subscribe these money market funds all came from the existing clients, which I think it is also a natural situation given they have already connected with us, they have already assets in our accounts. So it is very convenient for them to buy these mutual fund products.

But I think after May, starting from June, we see more and more people, actually they are not actively trading in these stocks. But through our new products we attract a new type of people and also, more importantly, we attract new money, [all] sites, [our] universe. I.e., we did see a lot of new people, because of these new products, start to open the trading accounts, start to open the fund accounts in our platform and have started to put new money into our platform.

So, I think going forward this is also why we are so determined, and we are so convinced we will go through this direction because it will enlarge our addressable market and also it will attract new people with new money [growth].

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Operator [13]

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(Operator Instructions). [Livi Liu], HSBC.

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Livi Liu, HSBC - Analyst [14]

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I have three questions. One -- the first one is also about wealth management. So, where do we book our earnings for the wealth management in the P&L segment? Is it in the other income? And also for the fee structure, we can see that from our official website about our products in the fee structure there is 100% subscription fee for us and then a sharing mechanism with the fund companies to share about the annual management fee. So, based on our [ground] research it's usually 50% to 60% sharing to the distribution channel in Hong Kong. Are we following the same policy?

And the second question is about margin financing. We can see that from the balance sheet we have over HKD3 billion balance of margin financing, but we only have less than HKD1 billion bank borrowings. So, where do we have the funding source to our margin financing business and what's the funding cost for this business?

And my third question is about our management just said Hong Kong is the first stop of our internationalization. So, where or which cities will be the choices that we are considering for next stops? And is Melon one of our choices as the Melon market is also opening up for the brokerage licenses?

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Arthur Chen, Futu Holdings Limited - CFO [15]

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Sure, for your three -- or maybe four questions, I will address the first three and the last question will be addressed by Leaf. In terms of the wealth management P&L impact, you are right. Currently the relevant revenue has been recorded in the other income items because we just launched money market funds in May. So, the P&L impact to the second quarter is still limited.

In terms of fee structure, you are also right. I cannot disclose the exact rebate numbers on the different mutual fund company, but I think your guesstimate, or the industry practice also applies to us as well.

For the margin financings, our major funding source actually came from Hong Kong local banks. On average borrowing costs were in the range of [HIBOR] plus 120 basis points to 130 basis points plus. Besides the margin, besides the bank borrowing also we support our margin financing through our own capital since we finished our IPO in March. And Leaf will share with you about his thoughts about our further internationalization strategy.

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Leaf Li, Futu Holdings Limited - Founder, Chairman & CEO [16]

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(Interpreted) So, following Hong Kong the US will be our second destination for internationalization. So, in the US we have got all the relevant SEC and clearing licenses. And I'm not sure if you noticed, earlier this year we actually launched our US product called Futu NiuNiu and we are actively polishing those products and adding more features. And in the second half of this year you'll see a lot of new iterations of our Futu NiuNiu product.

So, since we are still, as already mentioned, in a stage of developing our product, we haven't been marketing that aggressively. But you'll see a lot more marketing campaigns into the second half. So, NiuNiu will be the basis of our new iteration outside of China and Hong Kong.

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Operator [17]

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(Operator Instructions). Yiwen Zhang, Bank of China.

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Yiwen Zhang, Bank of China - Analyst [18]

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I have a question regarding new paying client retention. So, [announced] the 15,000 new additions, can you break down for how much is organic and how much is related to the marketing campaign? And again on the marketing campaign, it's more expensive in Hong Kong than China. And how should we view the (inaudible) and marketing expense going forward? This is my first question.

And a second (inaudible), I saw rapid growth in your (inaudible) revenue. In your prepared remarks you stated (inaudible) IPO [underwriting] and enterprise TR. Can you give us a size or (inaudible) of the IPO underwriting and enterprise TR? Thank you.

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Arthur Chen, Futu Holdings Limited - CFO [19]

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For two questions, number one, in terms of channels from the new clients acquired, similar to first quarter, the most part will come from the organic or word-of-mouth, which contributes over 65% of our total new paying clients acquired in this quarter. And also Hong Kong -- the online marketing and also the Hong Kong off-line market accounts for roughly close to 20% of our new paying clients acquired for this quarter.

Going forward, you are right, the marketing cost or equity cost for the Hong Kong clients is relatively high compared with that of Mainland. But I think from the unit economics, judging from these clients annual ARPU contribution and compared with our spending in terms of new clients acquired, it still makes sense for us to continue to spend money to acquire them in early manners.

Because if you can engage them in a much early situation, actually they will stick with our platform for even longer time. So, from a lifetime value perspective we do think acquiring price as early as possible is more critical compared with the current year's P&L impact.

In terms of the other revenues, you are right, mainly come from the ESOP contribution and also the IPO distribution. I think in terms of the -- proportion wise, IPO distribution accounts for an even bigger part versus over revenue. But I think the impact overall is still relatively limited given that the overall revenue just accounts for 9% of our total revenue.

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Operator [20]

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(Operator Instructions). Weicheng Tang, Goldman Sachs.

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Weicheng Tang, Goldman Sachs - Analyst [21]

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Just following up on two questions. One is can you give us an update of the product pipeline regarding the securities lending futures options -- when would they be rolled out, in like second half of 2019?

The second is regarding the tax. We heard that you mentioned there's a tax rebate on R&D expense. We just want to find out is this rebate one-off based on the aggregate R&D you have spent? Or it would be -- is a constant tax rate cut following your R&D expense?

The third question regarding the interest income -- sorry, interest expense. We found if we use -- I'm guessing the major expense -- entry expense, you -- corresponding to the liabilities of short-term borrowings and payable to brokers, maybe it's like (inaudible) brokers.

So, if we do the calculation, we found on a quarterly basis that average interest expense cost has went up a bit. We calculate it at around 3.9% in the first quarter and 4% in second quarter. So, do you think the cost will come down later on given you mentioned earlier that after listing your borrowings from banks actually it actually has a lower spread on HIBOR? Thanks.

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Arthur Chen, Futu Holdings Limited - CFO [22]

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I leave the first question to my colleague, Robin Xu, who will answer you a little bit later in terms of new product pipelines to be launched in the second half of this year. Let me just address your second and third questions first.

In terms of tax rebate, it is one-off on a quarterly basis, but it will be recurring items on a yearly basis. The thing is, according to the local Tax Bureau's treatments, they have -- in order to promote technology spending, they actually allow additional 40% to 50% of your annual expenses in terms of your deductions for your effective (technical difficulty) tax rate calculations.

So, in the second quarter of this year actually we finished all the applications and documented reviews by our auditor PriceWaterhouseCoopers which synced our applications to the Tax Bureau and also all the documentation was satisfactory. So, we have already deducted such tax benefits for 2018 in this quarter. Given we continue to have huge R&D spending going forward, I do think the relevant treatment will occur in 2019 and 2020 as well.

For the interest expenses, you are right. I think in terms of the type of spread which is charged by the commercial banks will go down gradually, given that after listing we actually have more bargaining powers or get more commercial treatment from these commercial banks. I think it's relatively -- the interest expense cost increase in the second quarter is mainly due to the underlying HIBOR increase which you can see.

But of course, at the same time, we also benefit a little bit from this in terms of interest income as well. But I think in terms of spread, the borrowing cost spread on top of the HIBOR, it will definitely continue to go down in the remaining quarters. Now I hand over to Robin for your first question.

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Robin Xu, Futu Holdings Limited - Vice President [23]

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(Interpreted) So, for our new product pipeline in the second half of this year, as for US trading, we'll start offering our clients the opportunity to lend out their stock position. And on the Hong Kong side we'll start offering the short selling function, the options and, as we just mentioned, we'll offer more mutual fund products on our platform. And also, we'll have an iPad version launching too in the third quarter. And also, we'll have a specific package catering to the more frequent traders in the second half as well.

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Operator [24]

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(Operator Instructions). [Husei Qui], [GPC Investment Management].

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Husei Qui, GPC Investment Management - Analyst [25]

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Can we get a bit more detailed on the affective commission rate? What makes it to increase by 30%, 38% or something year-on-year?

And my second question is on the sales and marketing expenses. How do [you see] the expenses? On an accounting basis does it include the rewards that you give to new users and give to the new users of your Money Plus?

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Arthur Chen, Futu Holdings Limited - CFO [26]

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Okay, sure. For the commission rate, actually we keep quite firm if not even went a little bit higher compared with the fourth quarter thanks to more expirations of the discount promotions. And also a lot of new IPO activities starting from the second quarter also enhance our commission rate, given that for the IPO we normally have some one-off handling charges which have been blended into our commission revenue as well.

For the marketing spending, you are right. In terms of our accounting treatments for all of these -- or the reward or these coupons, we all recognize it into our marketing expenses by accrual basis. So, it is being fully reflected into our P&L on a timely basis.

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Operator [27]

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(Operator Instructions). There are no further questions at this time. I would like to hand the conference back to Mr. Daniel Yuan. Please continue.

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Daniel Yuan, Futu Holdings Limited - Chief of Staff [28]

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That concludes our call today. On behalf of the Futu management team, I would like to thank you for joining us today. If you have any further questions, please do not hesitate to contact me or any of our Investor Relations representatives. Thank you and goodbye.

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Operator [29]

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Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may now disconnect.

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Editor [30]

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Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the Company sponsoring this Event.