老虎證券 (TIGR) 2021 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by and welcome to the UP Fintech Holding Limited Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. I must advise you that this conference is being recorded today, Friday, September 10, 2021.

女士們、先生們，感謝大家的支持，歡迎參加 UP Fintech Holding Limited 2021 年第二季財報電話會議。此時，所有參與者都處於只聽模式。將進行演示，然後進行問答環節。我必須通知您，本次會議將於今天（2021 年 9 月 10 日星期五）錄製。

I would now like to hand the conference over to your first speaker today, Mr. Clark S. Soucy. Thank you. Please go ahead, sir.

現在我想將會議交給今天的第一位發言者克拉克·S·蘇西先生。謝謝。請繼續，先生。

Thank you, Operator. Hello, everyone, and thank you for joining us for the call today. UP Fintech Holding Limited second quarter 2021 earnings release was distributed earlier today and is available on our IR website at ir.itiger.com as well as GlobeNewswire services.

謝謝你，接線生。大家好，感謝您今天加入我們的電話會議。UP Fintech Holding Limited 2021 年第二季財報於今天稍早發布，可在我們的投資者關係網站 ir.itiger.com 以及 GlobeNewswire 服務上取得。

On the call today from Up Fintech are Mr. Wu Tianhua, Chairman and Chief Executive Officer; Mr. John Zeng, Chief Financial Officer; Mr. Huang Lei, the CEO of U.S. Tiger Securities; and Mr. Kenny Zhao, our Financial Controller.

今天接受Up Fintech電話會議的是董事長兼執行長吳天華先生；曾約翰先生，財務長；美國老虎證券執行長黃磊先生；以及我們的財務總監 Kenny Zhu 先生。

Mr. Wu will give an overview of our business operations and discuss corporate highlights. Mr. Zeng will then discuss our financial results. They will both be available to answer your questions during the Q&A session that follows their remarks.

吳先生將概述我們的業務運營並討論公司亮點。然後曾先生將討論我們的財務表現。他們將在發言後的問答環節回答您的問題。

Now let me cover the Safe Harbor. The statements we are about to make contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. For more information about factors that could cause actual results to materially differ from those in the forward-looking statements, please refer to our Form 6-K furnished today, September 10, 2021, and our Annual Report on Form 20-F filed on April 28, 2021. We undertake no obligation to update any forward-looking statement, except as required under applicable law.

現在讓我來介紹一下安全港。我們即將發表的聲明包含 1995 年美國私人證券訴訟改革法案意義內的前瞻性聲明。許多因素可能導致實際結果與任何前瞻性聲明中包含的結果有重大差異。有關可能導致實際結果與前瞻性陳述中的結果存在重大差異的因素的更多信息，請參閱我們今天（2021 年9 月10 日）提供的表格6-K 以及我們於4 月份提交的表格20- F 年報2021 年 28 日。除適用法律要求外，我們不承擔更新任何前瞻性聲明的義務。

It is my pleasure to now introduce our Chairman and Chief Executive Officer, Mr. Wu. Mr. Wu will make remarks in Chinese, which will be followed by an English translation.

我很高興現在介紹我們的董事長兼執行長吳先生。吳先生將以中文致辭，隨後將有英文翻譯。

Mr. Wu, please go ahead with your remarks.

請吳先生發言。

Hello, everyone, and welcome to Tiger Brokers 2021 second quarter earnings conference call. Although market sentiment was weaker in the second quarter, we still achieved substantial growth, thanks to internationalization and the strength of our comprehensive product and service offerings.

大家好，歡迎參加老虎證券2021年第二季財報電話會議。儘管第二季市場情緒疲軟，但由於國際化以及我們全面的產品和服務的實力，我們仍然實現了大幅成長。

Total revenue in the second quarter was $60.2 million representing 98.7% growth year-over-year. This quarter, we also increased investment in user acquisition, self-clearing and talent recruitment. We are confident such investments will bolster our market-leading position and fuel future expansion in our business.

第二季總營收為 6,020 萬美元，年增 98.7%。本季我們也加大了在用戶獲取、自我清算和人才招募方面的投入。我們相信此類投資將鞏固我們的市場領先地位並推動我們業務的未來擴張。

Factor in the $13.7 million fair value change to convertible bonds we issued earlier this year, non-GAAP loss is $4.4 million for this quarter.

考慮到我們今年稍早發行的可轉換債券的公允價值變動為 1,370 萬美元，本季非 GAAP 虧損為 440 萬美元。

Total customer accounts increased by 249,000 in the second quarter to 1.649 million, which is 2x the total number of accounts in the same period of last year. We added 153,000 funded accounts this quarter, 4.5x that of the quarterly addition last year and a 30.4% increase quarter-over-quarter. The Number of total funded accounts rose to 529,000. Of the 153,000 new additions this quarter, over 60% came from offshore, exhibiting the growing momentum of our internationalization strategy.

第二季客戶帳戶總數增加24.9萬個，達到164.9萬個，是去年同期帳戶總數的2倍。本季我們新增了 153,000 個資金帳戶，是去年季度新增帳戶的 4.5 倍，季增 30.4%。資金帳戶總數增至 529,000 個。本季新增15.3萬人中，超過60%來自境外，體現了我們國際化策略的強勁勢頭。

Total newly funded accounts in the first half of 2021 reached 270,000, surpassing the total number of funded accounts acquired since our platform went online in 2015 through 2020. Even with a weaker market backdrop, we still see healthy asset inflows.

2021 年上半年新增資金帳戶總數達到 27 萬個，超過了我們平台自 2015 年上線至 2020 年以來獲得的資金帳戶總數。即使市場背景疲軟，我們仍然看到健康的資產流入。

Total AUM reached $23.9 billion this quarter, up nearly 3x times year-over-year and 11.8% quarter-over-quarter.

本季總資產管理規模達 239 億美元，年增近 3 倍，季增 11.8%。

I would now like to take this opportunity to provide investors an update on 3 key business initiatives at our Company.

我現在想藉此機會向投資者介紹我們公司三項關鍵業務舉措的最新情況。

Tiger Brokers is continually expanding. Our global reach and our network of subsidiaries covers the U.S., Australia, Singapore and other countries. Our subsidiaries are licensed to conduct a wide range of securities businesses, including investment banking, asset management and brokerage.

老虎經紀公司正在不斷擴張。我們的全球影響力和子公司網絡覆蓋美國、澳洲、新加坡和其他國家。我們的子公司獲準進行廣泛的證券業務，包括投資銀行、資產管理和經紀。

Our internationalization continues to accelerate. More than 60% of newly funded accounts this quarter came from offshore markets. And as of June 30, 40% of our total funded accounts were from international users. We only started executing on our internationalization strategy just over a year ago. But our progress thus far is a testament to the value proposition of our platform in foreign markets. We see vast latent demand for our services across a wide range of countries and regions and expect that internationalization will not only spur growth in new accounts, but also raise the ceiling for the future size of our client base.

我們的國際化進程不斷加速。本季超過 60% 的新增資金帳戶來自離岸市場。截至 6 月 30 日，我們資金帳戶總數的 40% 來自國際用戶。我們一年多前才開始執行國際化戰略。但我們迄今為止的進展證明了我們平台在國外市場的價值主張。我們看到多個國家和地區對我們的服務有巨大的潛在需求，預計國際化不僅會刺激新帳戶的成長，還會提高我們未來客戶群規模的上限。

As we expand to new countries and add products and markets to our trading platform, our firm gains new experience and knowledge for engaging with regulatory bodies, enabling us to further enhance the client experience. I am pleased to report that as of today, we already have over 200,000 funded accounts in Singapore. We firmly believe internationalization will drive further growth. Although the market has been weak since the second quarter, we are confident to achieve our guidance of 350,000 new funded accounts this year.

隨著我們擴展到新的國家並向我們的交易平台添加產品和市場，我們公司獲得了與監管機構合作的新經驗和知識，使我們能夠進一步增強客戶體驗。我很高興地報告，截至今天，我們在新加坡已經擁有超過 20 萬個資金帳戶。我們堅信國際化將推動進一步成長。儘管市場自第二季以來一直疲軟，但我們有信心今年實現 35 萬個新資金帳戶的目標。

2B services; today, our growth strategy envisions simultaneously developing our expertise in investment banking, ESOP and brokerage to augment our capabilities to meet our clients' global financial services needs.

2B服務；今天，我們的成長策略設想同時發展我們在投資銀行、員工持股計畫和經紀方面的專業知識，以增強我們的能力，以滿足客戶的全球金融服務需求。

The rapid expansion of our ESOP business continues to exceed our expectations. In the second quarter, we added 51 new ESOP clients for a grand total of 216 clients. We serve not only U.S. and Hong Kong listed companies, but we also help A-Share companies manage their employee options.

我們的ESOP業務的快速擴張繼續超出我們的預期。第二季度，我們新增了 51 位 ESOP 客戶，客戶總數達到 216 家。我們不僅服務美國和香港上市公司，也幫助A股公司管理其員工選擇權。

In the second quarter, we participated in 17 IPOs and follow-on offerings in the U.S. market and also served as an underwriter for 14, including Boss, Aihuishuo International, and Dingdong, among others.

第二季度，我們參與了美國市場17起IPO及增發，並擔任了14起承銷商，包括Boss、愛慧說國際、叮咚等。

In light of the recent concerns over ADR IPOs, I would like to highlight for our investors and stakeholders, that we possess extensive capability to act as an underwriter in Hong Kong. In the past year, we participated in many popular listings in Hong Kong such as those of Netease, Xpeng, BiliBili, Harbour Biomed, and Antengene, among others.

鑑於最近對 ADR IPO 的擔憂，我想向我們的投資者和利害關係人強調，我們擁有在香港擔任承銷商的廣泛能力。過去一年，我們參與了網易、小鵬汽車、嗶哩嗶哩、和鉑醫藥、德琪醫藥等多家香港熱門上市公司。

Finally, I would like to run an update on our self-clearing capability. In July of 2019, we acquired TradeUP Securities, Inc., formerly Marsco, a broker dealer with over 30 years experience in self-clearing and its own self-clearing license, because we wanted to establish the technical, operational and compliance capability to manage our own proprietary brokerage system. I am pleased to report that as of the second quarter 2021, more than 50% of our clients were having their U.S. cash equities self-cleared by TradeUp. We project that by the end of this year, we will be self-clearing over 70% of our clients.

最後，我想對我們的自我清理功能進行更新。2019 年7 月，我們收購了TradeUP Securities, Inc.（前身為Marsco），這是一家在自我清算方面擁有30 多年經驗並擁有自己的自我清算許可證的經紀交易商，因為我們希望建立技術、運營和合規能力來管理我們自己的專有經紀系統。我很高興地報告，截至 2021 年第二季度，我們超過 50% 的客戶透過 TradeUp 自行清算其美國現金股票。我們預計，到今年年底，我們將實現 70% 以上的客戶的自助清算。

Hello. Thanks, Tianhua and Clark. Let me walk through our second quarter financial performance. All numbers are in USD.

你好。謝謝天華和克拉克。讓我介紹一下我們第二季的財務表現。所有數字均以美元為單位。

Total revenue was $60.2 million this quarter, up 99% year-over-year. Commissions were $31 million, up 64% year-over-year, but down 41% from the first quarter of this year. The drop in commission was due to weaker market sentiment in the second quarter, as total trading volume dropped 18% quarter-over-quarter, plus the proportion of higher unit economic products, for example, cash equity dropped from 50% of the trading volume in the first quarter to 40% of trading volume in the second quarter. The decrease in commission also resulted in a lower blended take rate of 3 bps in the second quarter versus 4.3 bps in the first quarter of this year. But in reality, the fee rate remains the same for both quarters.

本季總營收為 6,020 萬美元，年增 99%。佣金為 3,100 萬美元，年增 64%，但較今年第一季下降 41%。佣金下降是由於第二季度市場情緒疲軟，總交易量環比下降18%，加上較高單位經濟產品的比例，例如現金權益佔交易量的比例從50%下降第一季交易量佔第二季度交易量的40%。佣金的減少也導致第二季的綜合佣金率下降 3 個基點，而今年第一季為 4.3 個基點。但實際上，兩個季度的費率保持不變。

Interest related income, which combines financing service fee and interest income was $19 million, an increase of 115% year-over-year and 7% quarter-over-quarter. The increase was due to higher marketing and securities lending balance and a gradual ramp-up in self-clearing.

利息相關收入（包括融資服務費和利息收入）為1,900萬美元，較去年同期成長115%，較上季成長7%。這一增長是由於行銷和證券借貸餘額增加以及自我清算逐步增加所致。

Other revenue was $10.2 million, up 300% year-over-year, primarily due to more equity underwriting IR/PR services and currency exchange services.

其他收入為 1,020 萬美元，年增 300%，主要是由於股票承銷 IR/PR 服務和貨幣兌換服務的增加。

Now switching to cost. Interest expense increased 154% year-over-year to $4.8 million this quarter, in line with our user growth as increase in margin activities. Execution and clearing expense were $6.6 million this quarter, increased 131% year-over-year, as we have more funded account customers and higher trading volume.

現在轉向成本。本季利息支出年增 154% 至 480 萬美元，與保證金活動增加帶來的用戶成長一致。本季執行和清算費用為 660 萬美元，年增 131%，因為我們擁有更多資金帳戶客戶和更高的交易量。

Employee compensation increased 82% year-over-year to $20.6 million, as we keep adding headcounts in R&D, self-clearing, to support our global growth. Along with the headcount increase, this quarter occupancy expense increased 32% year-over-year to $1.5 million.

員工薪資年增 82%，達到 2,060 萬美元，因為我們不斷增加研發人員、自我清算人員，以支持我們的全球成長。隨著員工人數的增加，本季的入住費用年增 32% 至 150 萬美元。

SG&A increased 84% year-over-year to $5.1 million. Marketing expense had the most uptake with the opex, increased more than 700% year-over-year to $24 million. We are fully committed to internationalization. And in the second quarter, we increased marketing offshore mostly in Singapore through both online and offline channel, to drive brand awareness and the user acquisition. We firmly believe grabbing more market share right now will help develop -- deliver better financial performance down the road.

SG&A 年增 84% 至 510 萬美元。行銷費用在營運支出中佔比最大，年增 700% 以上，達到 2,400 萬美元。我們全面致力於國際化。在第二季度，我們透過線上和線下管道增加了海外行銷，主要是在新加坡，以提高品牌知名度和用戶獲取。我們堅信，現在搶佔更多市場份額將有助於發展——在未來實現更好的財務表現。

As a result of rapid user growth, communication and the data usage also increased 143% year-over-year to $5 million this quarter. With the increased spending to drive growth and our fair value change of $13.7 million on the convertible bonds we issued earlier this year, our net loss for second quarter was $21.5 million. Taking all the fair value change and other non-GAAP items, our non-GAAP loss for this quarter was $4.4 million.

由於用戶快速成長，本季通訊和數據使用量也年增 143% 至 500 萬美元。由於增加支出以推動成長以及我們今年稍早發行的可轉換債券的公允價值變化為 1,370 萬美元，我們第二季的淨虧損為 2,150 萬美元。考慮到所有公允價值變動和其他非 GAAP 項目，我們本季的非 GAAP 虧損為 440 萬美元。

Now we have concluded our presentation. Operator, please open the line for Q&A. Thanks.

現在我們的演講結束了。接線員，請開通問答線。謝謝。

(Operator Instructions) We have the first question, this is coming from the line of Han Pu from CICC.

（操作員指示） 我們有第一個問題，這是中金公司韓璞的電話。

(foreign language) This is Han from CICC. I have 2 questions. The first one is about the guidance of the Q3. We see the strong growth of users in Q2. Could you give us more color on the number of clients and also current assets, and the cost of clearing it in the coming quarters.

（外語）我是來自中金公司的韓。我有 2 個問題。第一個是關於第三季的指導。我們看到第二季用戶的強勁成長。您能給我們更多關於客戶數量、流動資產以及未來幾季清算成本的資訊嗎？

The second question is about the clearing fee rate. We are wondering why the execution and the clearing fee rate to our commission wasn't moving at all in Q2, while we see the continuous increase in the self-clearing.

第二個問題是關於清算費率的問題。我們想知道為什麼第二季我們的佣金執行和清算費率根本沒有變化，而我們看到自我清算不斷增加。

So I will answer your 2 questions. First is on the guidance for the second -- for the third quarter. So looking at all this data, we see higher like UE products like cash equity, option, volume went up versus the second quarter. So we feel if market stays like this and we expect commission to have a moderate increase in the third quarter. But ADR underwriting is on hold due to the current policy from China and the U.S. regulators. So short term, this could have a lingering impact on our revenue. But the impact should be manageable as ADR underwriting only accounted for less than 10% of our revenue. So we think the ADR equity offering will resume once regulators gives more clarity.

所以我會回答你的2個問題。首先是第二季和第三季的指引。因此，從所有這些數據來看，我們看到現金權益、選擇權等 UE 產品的成交量較第二季上升。因此，我們認為，如果市場保持這種狀態，我們預計第三季佣金將適度成長。但由於中國和美國監管機構目前的政策，ADR承銷被擱置。因此短期來看，這可能會對我們的收入產生持久的影響。但影響應該是可控的，因為 ADR 承保僅占我們收入的不到 10%。因此，我們認為，一旦監管機構給出更多明確訊息，ADR 股票發行將會恢復。

And in the meantime, as Tianhua mentioned earlier, we are already active in Hong Kong IPOs as an international underwriter. And we already underwrote Bili Bili, Xiaopeng, those popular IPOs. So this could offset some short-term impact from the hold in U.S. equity underwriting.

同時，正如天華之前所提到的，我們已經作為國際承銷商積極參與香港IPO。我們已經承銷了嗶哩嗶哩、小鵬汽車這些熱門IPO。因此，這可能會抵消持有美國股票承銷的一些短期影響。

In terms of customer acquisition. So the biggest OpEx, is sales and marketing. We expect the third quarter market to -- our marketing expense to be like or less than second quarter, as we don't offer any offline events in Singapore. But we will be very opportunistic to acquire users when we see -- when we see fit.

在獲客方面。因此，最大的營運支出是銷售和行銷。我們預計第三季的行銷費用將與第二季相同或更少，因為我們不在新加坡提供任何離線活動。但當我們認為合適時，我們將非常機會主義地獲取用戶。

In terms of AUM per users. So in July and August, we still see very healthy net inflows for both months. But due to market sentiments, average AUM is down around 10% to 15% by end of August versus May -- end of June.

就每個使用者的 AUM 而言。因此，在 7 月和 8 月，我們仍然看到這兩個月的淨流入都非常健康。但由於市場情緒的影響，8 月底的平均 AUM 較 5 月底（6 月底）下降了約 10% 至 15%。

And your first -- second question regarding the clearing, the clearing expense went up. So the main reason of the increase in clearing expense is we have a lot more Singapore clients and we offer Singapore stock trading. Based on local regulation, if the client is trading Singapore Stock, the client's asset needs to be hold at SGX clearing member. Our Singapore subsidiary is not a SGX member yet, so we paid third party custodian fee for each clients open account with us. Given we have over 200,000 SG -- Singapore clients already, we paid close to $2 million custodian fee the second quarter which counted as our clearing expense.

你的第一 - 第二個問題是關於清算的，清算費用增加了。所以清算費用增加的主要原因是我們有更多的新加坡客戶，並且我們提供新加坡股票交易。根據當地法規，如果客戶交易新加坡股票，客戶的資產需要存放在新交所清算會員處。我們的新加坡子公司還不是新交所會員，因此我們為每位客戶在我們開立的帳戶支付了第三方託管費。鑑於我們已經擁有超過 20 萬名新加坡客戶，我們第二季支付了近 200 萬美元的託管費，這算是我們的清算費用。

As you might know, our Singapore subsidiaries already received [AIC] from SGX to become a clearing member. So once we officially become the SGX clearing member, we can greatly reduce the custodian fee. I believe we can see some reduction in custody fee starting in the first quarter.

如您所知，我們的新加坡子公司已從新交所獲得[AIC]，並成為清算會員。所以一旦我們正式成為新交所清算會員，我們就可以大幅降低託管費用。我相信從第一季開始，我們可以看到託管費下降。

(Operator Instructions) We have the next question, which is coming from the line of Judy Zhang from Citi.

（操作員說明） 我們有下一個問題，來自花旗銀行的 Judy 張。

(foreign language)

（外語）

[Interpreted]. So the funding of clients profile, so we used -- users were acquired last year say second quarter of 2020 as a cohort sample. Initial deposit among that group is around $6,000 to $7,000 USD. One year later, by end of second quarter this year, average client assets is around $30,000 USD. Since second quarter of last year, each quarter this cohort group has net asset inflow, which means they are keeping deposit money into their account and AUM growth is not only due to equity value appreciation.

[解釋]。因此，我們利用客戶資料的資金來源——去年（即 2020 年第二季）獲得的用戶作為隊列樣本。該群體的初始存款約為 6,000 至 7,000 美元。一年後，到今年第二季末，平均客戶資產約為 3 萬美元。自去年第二季以來，該群體每季都有淨資產流入，這意味著他們將存款存入帳戶，資產管理規模的成長不僅僅是因為股權價值升值。

If you look at new customer we acquired this quarter, second quarter of 2021, their average initial deposit is around $5000, slightly below the initial deposit of the second quarter of 2020 clients. We don't think this is due to a deterioration of client quality. We feel it's more like -- I mean it's more due to the less attractive market backdrops. We feel similar to the clients that we acquired last year after several quarters, they will keep depositing money to trade on Tiger platform.

如果你看看我們在 2021 年第二季獲得的新客戶，他們的平均初始存款約為 5,000 美元，略低於 2020 年第二季客戶的初始存款。我們不認為這是由於客戶品質下降所造成的。我們覺得這更像是——我的意思是這更多是因為市場背景吸引力較差。我們感覺和去年幾季後收購的客戶類似，他們會繼續存錢在老虎平台上交易。

So on customer acquisition costs and payback, we still use the second quarter of 2020 as a cohort sample. Back then, customer acquisition costs was about $130. And back then, the market was more active. So if we only count that commission, excluding interest, the payback was around 2 quarter for that cohort group.

因此，在獲客成本和回報方面，我們仍然使用 2020 年第二季作為隊列樣本。當時，獲客成本約為 130 美元。那時，市場更加活躍。因此，如果我們只計算佣金（不包括利息），則該群體的投資回收期約為 2 個季度。

Looking at newly acquired user in the second quarter of this year, due to more competition the customer acquisition cost went up to around $160 per person. And their commission also dropped due to a weaker market drop. Still we feel it's still going to be attractive for us to acquire those users, even though the payback increased to 4 to 6 quarter, because our users are relatively young. As long as we can get them payback in a relatively short period, there is still more -- a lot of upside for us to monetize.

從今年第二季新增用戶來看，由於競爭加劇，獲客成本上升至每人約 160 美元。由於市場下跌疲軟，他們的佣金也有所下降。儘管如此，我們仍然認為，儘管投資回收期增加到 4 到 6 個季度，但獲取這些用戶對我們來說仍然很有吸引力，因為我們的用戶相對年輕。只要我們能夠在相對較短的時間內獲得回報，我們就有更多的空間可以獲利。

We have the next question. This is coming from the line of Eric Lu from China Renaissance.

我們有下一個問題。這是來自華興資本的Eric Lu。

(foreign language) So my first question is, you saw the trading volume decreased quarter-over-quarter in second quarter, but the net interest income and margin financing balance both increased, especially the margin financing balance. So can I ask the rationale behind it?

（外文）所以我的第一個問題是，你們看到第二季交易量較上季下降，但是淨利息收入和融資融券餘額都增加了，特別是融資融券餘額。那我可以問一下背後的原理嗎？

So for the second question, we noted, our number of new paying clients acquired from Mainland China was more than our competitor. So can I ask what's the current -- what's our current customer acquisition strategy in Mainland China and the cost of it?

因此，對於第二個問題，我們注意到，我們從中國大陸獲得的新付費客戶數量比我們的競爭對手更多。那我可以問一下，目前我們在中國大陸的客戶獲取策略是什麼以及它的成本是什麼？

Sure. Eric, so I will answer your 2 questions. So the first one was on the net interest income. So the main reason of the net interest income increased while the trading volume came down is, we're starting to ramp up our self-clearing capability. So once we started, given we have more and more trading volume and asset hold in our own clearing firm, we are starting to use some of clients idle cash, which gives us cheaper funding and also gives us more flexibility in terms of the cap we can lend to each customers. And also becoming a self-clearing firm enables us to become a direct counterparty for securities lending business, which is pretty lucrative on the street. So we can generate more interest, we start sharing with other intermediaries. So that's the main reason, our interest -- net interest income increased in the second quarter, while the trading volume came down.

當然。艾瑞克，我來回答你的兩個問題。第一個是淨利息收入。所以淨利息收入增加而交易量下降的主要原因是我們開始增強我們的自我清算能力。因此，一旦我們開始，鑑於我們自己的清算公司擁有越來越多的交易量和資產持有量，我們開始使用一些客戶的閒置現金，這使我們的資金成本更低，並且在我們的上限方面也給了我們更大的彈性。可以藉給每個客戶。成為一家自我清算公司也使我們能夠成為證券借貸業務的直接交易對手，這在街上是相當有利可圖的。這樣我們就可以產生更多的興趣，我們開始與其他中介機構分享。所以這就是主要原因，我們的利息——淨利息收入在第二季增加了，而交易量卻下降了。

And of course you know the margin balance, if you look at our balance sheet, also increased versus the first quarter, but the $1 billion margin balance on our balance sheet includes Hong Kong IPO. So take out IPO, which is not that profitable for us -- for the Hong Kong IPO margin basis. Taking out that part, our margin loan balance is about $450 million, while in the first quarter was about $400 million. So those 2 are the main reasons why net interest income went up in the second quarter.

當然，如果你看看我們的資產負債表，你就知道保證金餘額也比第一季有所增加，但我們資產負債表上 10 億美元的保證金餘額包括香港 IPO。因此，以香港首次公開募股的利潤率為基礎，剔除首次公開募股（IPO），這對我們來說利潤不高。除去這部分，我們的保證金貸款餘額約為 4.5 億美元，而第一季約為 4 億美元。所以這兩個是第二季淨利息收入上升的主要原因。

And in terms of the customer acquisition for onshore customers. So in the second quarter, we have been actually working with more channels or intermediaries to target Chinese investors who already have assets offshore. So this is showing -- so far showing good results. And of course, our ESOP is also a pretty good user acquisition tool for us to tap into those Chinese users.

在境內客戶的客戶獲取方面。所以在第二季度，我們實際上一直在與更多管道或中介機構合作，瞄準已經在海外擁有資產的中國投資者。所以這表明——到目前為止，顯示出良好的結果。當然，我們的員工持股計畫也是一個非常好的用戶獲取工具，可以幫助我們挖掘中國用戶。

In terms of customer acquisition cost, it's pretty much in line with our previous customer acquisition cost for Chinese users. The major increase of our customer acquisition cost actually came from Singapore, as we mentioned earlier.

從獲客成本來看，和我們先前針對中國用戶的獲客成本基本上一致。正如我們前面提到的，我們獲客成本的主要成長實際上來自新加坡。

We have the next question. This is coming from the line of [Yan Zeng] from TH Capital.

我們有下一個問題。這是來自泰合資本[Yan Zeng]的線。

This is [Stella] from TH Capital. I have 1 question. I was hoping management could shed some light on the trading asset distribution. Given the previous experience and regulations on Chinese ADR in terms of your customer transaction behavior, do you see any shift to Hong Kong securities? And can I think this intensive competition was partly due to some kind of transaction has been achieved? That's my question.

我是泰合資本的[Stella]。我有 1 個問題。我希望管理層能對交易資產的分佈有所了解。鑑於您的客戶交易行為方面以前對中國ADR的經驗和規定，您是否認為會轉向香港證券？我是否可以認為這種激烈的競爭部分是由於某種交易的實現？這就是我的問題。

Sure. I -- you were a little bit breaking up. So you mean the trading volume shifting to Hong Kong and do we see more strong competition from the existing players?

當然。我——你有點分手了。那麼您的意思是交易量轉移到香港，我們是否看到現有參與者的競爭更加激烈？

Yes, exactly.

對，就是這樣。

Okay. So in terms of -- so the thing is, right now, if you look at all the Chinese ADRs coming back to Hong Kong, we think this will likely be a trend. As we mentioned earlier, we have been very active in Hong Kong as a international underwriter for Chinese ADR secondary listing in Hong Kong. So I think that part, we feel pretty confident we can keep getting more corporate clients and also use these opportunities to acquire more retail clients.

好的。因此，就目前而言，如果你看看所有回到香港的中國 ADR，我們認為這可能會成為一種趨勢。正如我們之前提到的，作為中國 ADR 在香港二次上市的國際承銷商，我們在香港一直非常活躍。所以我認為，我們非常有信心能夠繼續獲得更多的企業客戶，並利用這些機會獲得更多的零售客戶。

And then in terms of trading capabilities, traditionally, our strength was under -- in the U.S. market. But recently, we have developed a lot more resource to develop our Hong Kong trading capabilities. For example, you know, the Hong Kong Level 2 data, I think we are one of the few firms to offer it for free. And you know the Hong Kong options, we are one of the first firm to offer to investors. So we think the trading, no matter it's from the primary market or the secondary market, we are much more capable versus where we were 1 or 2 years ago. So I think the trend, we will still benefit, once we develop more resources into the Hong Kong trading capability and R&D.

然後就交易能力而言，傳統上我們的優勢在於美國市場。但最近，我們開發了更多資源來發展我們的香港貿易能力。例如，你知道，香港二級數據，我認為我們是少數免費提供它的公司之一。您知道香港選擇權，我們是第一批向投資者提供的公司之一。所以我們認為交易方面，無論是一級市場還是二級市場，我們比一兩年前的能力強很多。因此，我認為，一旦我們在香港的貿易能力和研發方面開發更多資源，我們仍然會受益。

Thank you. We have no further questions at this moment. I would like to hand the conference back to our host for any ending remarks.

謝謝。目前我們沒有進一步的問題。我想將會議交還給我們的東道主，讓其發表結束語。

I would like to thank everyone for joining our call today. I am now closing the call on behalf of the management team here at Tiger. We do appreciate your participation in today's call. If you have any further questions, please reach out to our Investor Relations team. This concludes the call and thank you very much for your time.

我要感謝大家今天加入我們的電話會議。現在我代表 Tiger 的管理團隊結束這通通話。我們非常感謝您參加今天的電話會議。如果您還有任何疑問，請聯絡我們的投資者關係團隊。通話到此結束，非常感謝您抽出寶貴的時間。