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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 20-F

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Date of event requiring this shell company report . . . . . . . . . . . . . . . . . . .

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For the transition period from to

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Commission file number: 001-38820

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Futu Holdings Limited

(Exact name of Registrant as specified in its charter)

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N/A

(Translation of Registrant’s name into English)

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Cayman Islands

(Jurisdiction of incorporation or organization)

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11/F, Bangkok Bank Building

No. 18 Bonham Strand W, Sheung Wan

Hong Kong S.A.R., People’s Republic of China

+852 2523-3588

(Address of principal executive offices)

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Arthur Yu Chen, Chief Financial Officer

Telephone: +852 2523-3588

Email: ir@futuholdings.com

11/F, Bangkok Bank Building

No. 18 Bonham Strand W, Sheung Wan

Hong Kong S.A.R., People’s Republic of China

(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)

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Securities registered or to be registered pursuant to Section 12(b) of the Act:

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*    Not for trading, but only in connection with the listing on The Nasdaq Global Market of American depositary shares.

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Securities registered or to be registered pursuant to Section 12(g) of the Act:

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None

(Title of Class)

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Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

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None

(Title of Class)

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Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

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As of December 31, 2020, 590,139,760 Class A ordinary shares (excluding the 75,751,180 Class A ordinary shares issued to the depositary bank for bulk issuance of ADSs reserved for future issuances upon the exercise or vesting of awards granted under our share incentive plans) and 494,552,051 Class B ordinary shares, par value US$0.00001 per share, were issued and outstanding.

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  ⌧ Yes  ◻ No

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If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.  ◻ Yes  ⌧ No

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Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  ⌧ Yes  ◻ No

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  ⌧ Yes  ◻ No

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ◻ Yes  ◻ No

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† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

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Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.   ⌧ Yes  ◻ No

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Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

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If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.  ◻ Item 17  ◻ Item 18

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If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  ☐ Yes  ⌧ No

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(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

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Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  ◻ Yes  ◻ No

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LETTER TO SHAREHOLDERS

Dear Shareholders,

This is our first letter to you since Futu’s IPO and listing on Nasdaq in March 2019. I want to take this opportunity to share with you who we are and what we want to achieve.

In October 2012, Futu obtained a Type 1 License (Dealing in Securities) from the Securities & Futures Commission of Hong Kong. After over 8 years of business development, Futu now holds 35 licenses, memberships and registrations across Hong Kong, the United States, Singapore and Europe, and serves over 13 million users from over 200 countries and regions. As we execute towards our mission to “make investing easier and not alone,” we have transformed from a brokerage service provider to an all-rounded online financial services platform integrating trading, wealth management, market data and information, social collaboration and corporate services.

Our relentless focus on product and user experience

As the No. 18 employee of Tencent, I first experienced Hong Kong stock trading when Tencent went public in Hong Kong in 2004. The primitive user interface and cursory services of the Hong Kong brokers shocked me, who came from an internet company that attaches the most importance to cultivating the best user experience possible. I decided to leverage my product development experience to transform the trading experience of retail investors in Hong Kong by bringing interactive technology, digitization and social networking to financial services.

We have always been upgrading our products. In 2020, the eighth year after Futu’s inception, we still rolled out 86 iterations of our application and 3,900 new product features. Many product upgrade ideas originated from our users. Every day, product managers and I get tagged by many users in their NiuNiu Community posts on product suggestions. We treasure all user feedback and strive to respond to every single piece in a timely manner. We firmly believe that a good product must meet the evolving needs of its users, and we hope to continue improving our products and grow with our users.

In addition to our unwavering focus on user experience, we rapidly expanded our product portfolio. We started with Hong Kong cash equities trading services, and gradually expanded to cover the main products on major exchanges around the world, including US equities, China A-shares qualified under the Hong Kong, Shanghai and Shenzhen Stock Connect, options, futures, Hong Kong callable bull/bear contracts, and Hong Kong warrants. We also launched margin financing services for Hong Kong and US equities, IPO subscription services, and dark pool trading for Hong Kong IPOs. For many investors, trading and wealth management go hand-in-hand. Therefore, we launched Futu Money Plus in response to our clients’ increasingly diversified needs for wealth management. As of 2020 year-end, we established partnerships with 39 leading global asset managers, selectively offering approximately 100 top-notch fund products.

Going forward, we will continue to enrich product offerings, including global futures as well as tools and features to facilitate investing decision-making, thereby “making investing easier.”

Constructing an interactive financial ecosystem

The latter half of our mission is to “make investing not alone.”

The investing journey can be a turbulent one, with moments both high and low. For individual investors, investing can be a lonely process as they study business fundamentals, analyze macroeconomic trends, invest, anticipate market performances, review investing decisions, over and over again. It will be a much more enriching experience if investors can stay connected, share the moments of ups and downs with, and learn from, people who bear the same enthusiasm for investing. The NiuNiu Community enables this exact type of experience. This February, Futubull surpassed 1 million in daily active users for the first time and generated an average of approximately 310,000 user-generated content and over 3,000 posts of trading history on each trading day.

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In the NiuNiu Community, users can post investment ideas and trading history as well as interact directly with over 700 companies, fund managers, media and key opinion leaders through posts and live-streaming. The NiuNiu Community helps investors enrich investing knowledge, identify fitting investment strategies, and establish rapport with other investors. This engaging social community contributes immensely to our competitive moat. Even the best investment tools may be replicated through time, but the content and culture of a community stand and persist. The many years of hard work we poured into cultivating the NiuNiu Community have translated into the unique community culture we have today. The caring and supportive atmosphere as well as the sense of inclusiveness and curiosity imbued in our NiuNiu Community promote user engagement and increase user stickiness.

2021 is the year of Futu’s internationalization

Following Futu’s growing market share among residents in mainland China and Hong Kong, we would like to expand our footprint into more countries with our moomoo app. Singapore and the United States come as strategic focuses of our international expansion in 2021. We believe our product that seeks for depth, perfection and connectivity can provide highly differentiated value propositions to retail investors in these markets.

Singapore’s financial industry is mature, with many established securities brokers. However, most brokers fail to meet investors’ needs in the mobile internet era, and charge exorbitant fees. We officially launched moomoo in Singapore on March 8, 2021, and have since then seen robust growth momentum and received encouraging user feedback. We are confident in our growth prospects in Singapore. Looking ahead, we will leverage Singapore as our entry point into the broader Southeast Asia market.

In the U.S., quite a few online brokers have developed trading platforms with easy-to-use interfaces and simple functions to cater to newbie investors. There are also well-established brokerage firms which provide advanced features but lack straightforward mobile experience. We believe that moomoo strikes a delicate balance between user-friendly mobile design and advanced product features, and can thus very well fill the market gap between incumbents and online brokers.

When I founded Futu nine years ago, I made the decision to develop a fully-proprietary closed-loop trading system in Hong Kong. This was not an easy nor fast path to embark on, but it allowed us to build a solid foundation to our business. Thanks to that decision, now we can quickly launch and upgrade products, expand our system, and replicate our business in new markets. Never has technology played a more transformational role in financial services, and we are committed to capturing the tremendous opportunities in this new era.

Leaf Hua Li

Founder, Chairman of the Board,

Chief Executive Officer and

Chairman of the Technology Committee

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INTRODUCTION

Unless otherwise indicated or the context otherwise requires, references in this annual report to:

Unless otherwise noted, all translations from Hong Kong dollars to U.S. dollars and from U.S. dollars to Hong Kong dollars in this annual report were made at a rate of HK$7.7534 to US$1.00, the exchange rate as of December 31, 2020 as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. We make no representation that any Hong Kong dollars or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or Hong Kong dollars, as the case may be, at any particular rate, or at all.

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FORWARD-LOOKING INFORMATION

This annual report contains forward-looking statements that reflect our current expectations and views of future events. The forward looking statements are contained principally in the sections entitled “Item 3. Key Information—D. Risk Factors,” “Item 4. Information on the Company—B. Business Overview” and “Item 5. Operating and Financial Review and Prospects.” Known and unknown risks, uncertainties and other factors, including those listed under “Item 3. Key Information—D. Risk Factors,” may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include, but are not limited to, statements relating to:

These forward-looking statements involve various risks and uncertainties. You should read thoroughly this annual report and the documents that we refer to with the understanding that our actual future results may be materially different from and worse than what we expect. Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in “Item 3. Key Information—D. Risk Factors,” “Item 4. Information on the Company—B. Business Overview” and “Item 5. Operating and Financial Review and Prospects” and other sections in this annual report. Moreover, we operate in an evolving environment. New risk factors and uncertainties emerge from time to time and it is not possible for our management to predict all risk factors and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.

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This annual report contains certain data and information that we obtained from various government and private publications. Although we believe the data and information to be reliable, we have not independently verified the accuracy or completeness of the data and information contained in these publications. Statistical data in these publications also include projections based on a number of assumptions. The online brokerage and related industries may not grow at the rate projected by market data, or at all. Failure of these markets to grow at the projected rate may have a material and adverse effect on our business and the market price of the ADSs. In addition, the rapidly evolving nature of the online brokerage industry results in significant uncertainties for any projections or estimates relating to the growth prospects or future condition of our market. Furthermore, if any one or more of the assumptions underlying the market data are later found to be incorrect, actual results may differ from the projections based on these assumptions. You should not place undue reliance on these forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this annual report and the documents that we refer to in this annual report and have filed as exhibits to this annual report, of which this annual report is a part, completely and with the understanding that our actual future results may be materially different from what we expect.

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PART I

Item 1.          Identity of Directors, Senior Management and Advisers

Not applicable.

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Item 2.          Offer Statistics and Expected Timetable

Not applicable.

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Item 3.          Key Information

A.    Selected Financial Data

The following selected consolidated statement of comprehensive (loss)/income data for the years ended December 31, 2018, 2019 and 2020, selected consolidated balance sheet data as of December 31, 2019 and 2020 and selected consolidated cash flow data for the years ended December 31, 2018, 2019 and 2020 have been derived from our audited consolidated financial statements included elsewhere in this annual report. The selected consolidated statement of comprehensive (loss)/income data for the year ended December 31, 2016 and 2017, selected consolidated balance sheet data as of December 31, 2016, 2017 and 2018 and selected consolidated cash flow data for the year ended December 31, 2016 and 2017 have been derived from our audited consolidated financial statements not included in this annual report. Our consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. Our historical results are not necessarily indicative of results expected for future periods. You should read this “Selected Financial Data” section together with our consolidated financial statements and the related notes and “Item 5. Operating and Financial Review and Prospects” included elsewhere in this annual report.

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Notes:

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The following table presents our selected consolidated balance sheet data as of the dates indicated:

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The following table presents our selected consolidated cash flow data for the periods indicated: