Futu Announces Investment Grade Rating from S&P Global Ratings

Rhea-AI Summary

Futu Holdings Limited (Nasdaq: FUTU) has received a long-term issuer credit rating of "BBB-" from S&P Global Ratings, with a stable outlook, marking the first standalone investment grade rating for a Hong Kong-based broker. This rating reflects Futu's strong market position in Hong Kong's brokerage market, solid capitalization, and effective risk controls. S&P expects Futu to maintain capital adequacy for growth and highlights its potential to expand into overseas markets, supported by synergies with Tencent, its second-largest shareholder.

Positive

• Futu received a 'BBB-' investment grade rating from S&P Global Ratings.
• The company is the first Hong Kong-based broker to achieve a standalone investment grade issuer rating.
• S&P notes Futu's strong market presence and growth potential in both local and overseas markets.

Negative

• None.

HONG KONG, June 03, 2021 (GLOBE NEWSWIRE) -- Futu Holdings Limited (“Futu” or the “Company”) (Nasdaq: FUTU), a leading tech-driven online brokerage and wealth management platform in China, today announced S&P Global Ratings (“S&P”) has assigned an investment grade long-term issuer credit rating “BBB-” to the Company. The outlook on the long-term rating is stable. A “bbb” GCP (group credit profile) has also been assigned. The rating on Futu reflects the Company’s leading market position in the Hong Kong brokerage market, strong capitalization with solid financing standing, and prudent risk controls.

Futu is the first online broker in the Asia-Pacific region to have obtained international rating, and the first Hong Kong-based broker to have obtained standalone investment grade issuer rating, with its “bbb” GCP being the highest grade GCP/SACP (standalone credit profile) that S&P has assigned to securities firms in Greater China.

According to S&P, Futu has good market presence in Hong Kong as a retail-focused online broker, and is well-placed to take advantage of the brand recognition to expand overseas market such as US and Singapore. Despite the current reliance on brokerage, Futu is striving to develop new business segments including wealth management, enterprise services, and diversify revenue sources, geographic reach, product categories and client base. Futu’s rating is well-positioned by its strong RAC (risk-adjusted capital), and S&P anticipates that Futu will sustain the capital adequacy to support its rapid growth. Futu’s funding sources can satisfy its funding needs thanks to the large collateral pool and prudent credit policies, and the company will pay more attention to the diversification of funding channels in the future. In addition, Futu also benefits from business synergies with Tencent, its second largest shareholder by voting rights as of end-2020.

About Futu Holdings Limited

Futu Holdings Limited (Nasdaq: FUTU) is an advanced technology company transforming the investing experience by offering a fully digitized brokerage and wealth management platform. The Company primarily serves the emerging affluent population, pursuing a massive opportunity to facilitate a once-in-a-generation shift in the wealth management industry and build a digital gateway into broader financial services. The Company provides investing services through its proprietary digital platforms, Futubull and moomoo, each a highly integrated application accessible through any mobile device, tablet or desktop. The Company's primary fee-generating services include trade execution and margin financing which allow its clients to trade securities, such as stocks, warrants, options, futures and exchange-traded funds, or ETFs, across different markets. Futu enhances the user and client experience with market data and news, research, as well as powerful analytical tools, providing them with a data-rich foundation to simplify the investing decision-making process. Futu has also embedded social media tools to create a network centered around its users and provide connectivity to users, investors, companies, analysts, media and key opinion leaders.

For investor inquiries, please contact:

Investor Relations
Futu Holdings Limited
ir@futuholdings.com 

FAQ

What is the significance of Futu's BBB- rating?

The BBB- rating from S&P indicates that Futu Holdings has a stable financial outlook and is considered to have a strong capacity to meet its financial commitments.

How does Futu's rating affect investor confidence?

The investment grade rating enhances investor confidence, as it reflects the company's strong market position and financial stability.

Is Futu the only online broker in Hong Kong with an investment grade rating?

Yes, Futu is the first Hong Kong-based online broker to receive a standalone investment grade issuer rating.

What are Futu's plans for business expansion?

Futu aims to expand into overseas markets like the US and Singapore while developing new business segments in wealth management and enterprise services.