FY 2024 Full-Year Results Presentation

Hello, everybody. A warm welcome to all of you for joining IFAAS Corporation's fourth quarter 2024 and full year 2024 results presentation. My name is JP. I am from the corporate communications team. And together with me today from the IFAAS team, we have Chong Chun, our CEO. And we have our group finance directors, Winnie, David, and Terrence as well. I will go through the key summary and section one on the financial results before inviting Chong Chun to present on the section two part, which is on the business update. Thereafter, we will have the Q&A segment. So starting with the key summary, in fourth quarter, 2024, the group's net profit increased by 46.3% year on year to $19.28 million on the back of the 26.7% increase year on year in the group's gross revenue to $104.14 million. The increase in 4th quarter 2024 profitability was driven by continuing growth in the group's core wealth management platform business and a turnaround of IFAS Global Bank. IFAS Global Bank achieved a net profit of $0.3 million in 4th quarter 2024 compared to a loss of $2.57 million in the 4th quarter of the previous year. In 2024, Group AUA increased 26.2% year-on-year to a new record high of $25.01 billion, driven by net inflows of $1 billion in fourth quarter 2024 and $3.3 billion for the whole of 2024. IFAW's global banks profitability in fourth quarter 2024 was achieved as customer deposits crossed $1.01 billion at the end of 2024, which is an increase of 182.6% during the year. The bank's gross revenue increased by 163% to $17.22 million in fourth quarter of 2024. The group sees IFAS Double Bank's ability to achieve profitability in less than three years after the acquisition, which was in end March, 2022, as a major achievement. It is a testimony to the fact that the innovative truly global business model that the group has been sharing with investors is working well. It also demonstrates the group's ability to deploy new technology solutions rapidly, in a secure manner, and at far lower costs than most banks around the world. Looking forward into 2025, the group expects to achieve further progress for our various business segments. The group expects to continue to grow the AUA of its wealth management platform business, which will drive further growth in revenues and profitability. In addition, the group expects IFAS Global Bank to build upon its profitable fourth quarter 2024 and achieve a full year of profitability in 2025. With regard to the Hong Kong E-Pension Division, the group expects further growth as onboarding rates continue to progress and also business starts to contribute. Barring unforeseen circumstances, the group expects 2025 to see robust growth rates in revenues and profitability compared to 2024.

For the final dividend for full year 2024, the directors proposed a dividend of 1.6 cents per ordinary share, which is higher than the final dividend for FY2023 at 1.4 cents per ordinary share. The proposed final dividend will be subject to approval by shareholders at the company's annual general meeting, which will be held on 28 of April, 2025.

Moving on to our group's AUA. So as mentioned, we hit another record high of $25.01 billion as of 31st December, 2024, which is a 26.2% year-on-year growth. Roughly the split between B2B and B2C, B2C takes about 33%, and B2B is the larger contributor at about 67%. In terms of the AOA breakdown by markets and products, so Singapore remains the larger market at 70.3%, followed by Hong Kong and Malaysia at roughly about 12% each, and others, which is better of China and the UK. In terms of the AUA breakdown by products, so the majority comes from unit trust at 57% contribution, followed by stocks and ETFs at 22%, bonds at 12.6%, and cash account and deposits at 7.8%. We'll move on to section one on the financial results. So starting with fourth quarter, 2024. So gross revenue grew 26.7% year on year to $104.14 million in fourth quarter 2024. Net revenue grew 13.6% year on year to $64.9 million in fourth quarter 2024. Net profit grew by 46.3% year on year to $19.28 million in fourth quarter 2023.

For financial results based on full year 2024, so gross revenue grew by 49.3% year on year to 382.99 million dollars. Net revenue grew by 53.6% year on year to 248.38 million dollars and net profit grew by 135.7% year on year to 66.63 million dollars for full year 2024. Okay, the results overview for the group over the last five years. So we'll find that there was a record performance for the group in net profit, gross revenue net revenue for Fourier 2024. I shall not go into all the details on this slide. We'll move on to the financial indicators for the non-banking operation. So for the non-banking operation in fourth quarter 2024, gross revenue grew by 14.9% year-on-year to 86.92 million dollars. Net revenue grew by 6.2% year-on-year, 57.18 million dollars. And net profit grew by 20.5% year on year to $18.98 million. For non-banking operation again but for full year 2024 results, so gross revenue grew by 40.3% year on year to $330.98 million. Net revenue grew by 51.2% year on year to $225.79 million. And net profit grew by 92.5% year on year to $71.01 million.

We have the usual statistics on the profit before tax margin for the group, which is based on total net revenue. So that has been trending upwards over the last couple of years. So we ended 2024 by 33.5% for the PBT margin. Similarly for return on equity, there's a good upward trend. And we ended the year 2024 at 23.4% for our ROB. In terms of the profit and loss by geographical segment,

as highlighted just now, so for fourth quarter 2024, the UK banking operation, then profitable with a $0.3 million profit. And across the various market segments in fourth quarter 2024, markets like Singapore and Malaysia had a roughly 40% year on year growth in terms of the profit. For full year 2024, I think one thing to highlight is the narrowing of losses for the China operation as well, and of course, the improving of UK operation profitability from the fourth quarter of 2024. I shall not go through the geographical segment breakdown for the last five years. The next slide shows the total net revenue by geographical segment. Exciting, the market set registered strong growth rate in net revenue in full year 2024 would be the likes of Hong Kong, UK and Singapore.

So we'll wrap up section one with the dividend for full year 2024. So as mentioned just now, it's a proposed final dividend of 1.6 cents, which is to be approved by the shareholders at the AGM to be held on 28 of April. That will bring the total dividend, if approved by the shareholders, to 5.9 cents for Fourier 2024, which is higher than the 4.8 cents for Fourier 2023. So with that, I will invite Chongqing to share more about the business update in Zheqin. Thank you, T.

On my phone, I'd like to give some business update, just zooming in on the couple of points that I'd like. The first point I released about the IFAS Global Bank. Recall that IFAS Global Bank was acquired,

or we acquired UK Bank in 2022, the completion in March, 2022. And since then, we've renamed it IFAS Global Bank. And along the way, we launched two new business division, one is digital transaction banking, the other is digital investment banking. both have actually progressed quite well as a result of that. The bank have actually improved quite a bit in operation. And with the latest set of results, you find that the bank have done it did the problem. So I've included a few slides here just to share with the sound journey in the country. So this particular slide shows the quarterly losses that the pay has incurred over the last two years. And in the last few quarters, the losses start to narrow and in this quarter, it actually windowed the black.

In line with what we have targeted,

as mentioned one year ago, we essentially turned profitable in less than three years after we acquired the bank. I think typically when it comes to digital bank or startup bank, I think most investor shareholders tend to be somewhat skeptical about the need for a new bank to be profitable in the initial period of time. I think the reason is because if you look at the examples that we see, I would say that the new banks have created, most of them spent a lot of money in a starting of a bank in those are cause of setting down as well as ongoing operating causes. In our case, of course, we find that those are cause of setting up, all right, we can manage it far better than most other banks have been able to do. We attribute this to the fact that as a financial institution who have been building internal IT capability all these years were quite experienced in moving out new projects, new technology roll-off so we can control the cost much better. And that's why we have been confident that cost management will be something that we can handle quite well. And that of course, mean that we are able to get into the black and relatively low level of business compared to both other stock and banks. In our case, we crossed the $1 billion deposit at the end of 2024. And that has made the journey that has brought us into the bank. We do the next slide. This shows the revenue strength that the bank have been having. Initially, the revenue base that you have comes mainly from the easier remit business, which is really the remit business, which is a main business that the group have, one will acquire the bank, or the bank have where you acquired the bank. But since then, other parts of the revenue have been growing and if you look at the overall revenue for the bank, you can see a really nice steady uptrend over the last few years. Next slide shows some breakdown. It does a contribution from the different divisions. So there are three key divisions in the bank. One would be the EZRAMIT, which is the original business of the bank. That part is pretty much fee income, transactional income,

some FX income, a bit of volatility sometimes, but by and large over the last two years, there's some group, not huge, but there's been some group. The part that has grown quite strongly, which is the interesting come. When we acquired the bank, the bank didn't have a business model of trying to grow their deposit base. At that time, the bank saw deposits as a source of looking capital that essentially is a cost factor that's how the bank was previously run but we see deposits as a source of revenue. We see that as being something that fits into the well-matched business that we have very well and as a result that we have actually been you know looking on the DPP and DTV division that actually grows the deposit base as well as interest income. Along with that as well the DPP and DTP division that we have also generated some fee income for the bank but the net interest income will be a bigger part. They have been driving the growth of the overall revenue of the bank. So by the fourth quarter that the bank ratio set a size such that we'll be able to of the profitable. Next slide. So yeah, this is just a summary of what I was mentioning. Essentially, we have a contribution from 3K division and that had brought a bank into profit. I would now like to just give a quick summary of our three of them. I think recall that in the last few years, we have been talking about our three of plans. We started off talking about five years and four years and three years. We were talking about five years because at that time, some of our plans would take several years to materialize, including the expansion project.

And develop for the bank is a vision that we had, but I think initially perhaps investors definitely understand our vision. So we took the step of talking about some of the things

something that's further hit five year plan and then four year plan three. Just so that the investors can understand what is it they're trying to achieve. Right, so right now, basically just a recap of our latest update to three year plan. So the first point really is about our co-work management business. That has been something that has been growing over the last 25 years since we started and that continues to be something that will be co-business for the group And in 2026, we grew the AOA by about 26%.

And if we continue at 26% for NMC-AGR, then we will hit our 100 billion by 2030.

If we grow at 32%, then we can do so by 2029. So we are hopeful that with the first global bank, it's a good ecosystem, then we can actually have a good base of growth as we move on.

Second point really is about the bank. We have achieved the first quarter of profit, of half a kilo, but certainly we expect that to be the starting point the starting point and certainly 2025, expect that to be first with your profitability and I think if you understand the nature of the banking business, once we have the right model,

business momentum and continue and the potential for the revenue of profitability will be very substantial.

The third part really is about e-pensions. This is a business that contributed a big part of the increase in 2024 revenue and profitability.

As we go into 2025, we expect further growth because the onboarding continues to increase. It is a business whereby in terms of the revenue stream is that what the challenges in practice will be in ensuring that we able to deliver services well without too much operational income and the value sources caused a lot. So these are essentially the key points for parcel management.

In 2025 as well, we expect the also business which will be included in the pension to start contributing. The current timetable is that we're expecting that to start

by the end of second quarter. Four points that I've included here is really to mention the fact that as a group, we continue to push forward with our overall innovation. Now that we're in the banking business, Google banking, It's actually important that we're able to develop some sort of payment related services so that it fits into overall global banking business pattern, the overall global well management business pattern. There's also the points of work, one part of the business where in Malaysia we have content, the RMO license for trading in bond, RMO's registered market operator. And so we will be going live with that part of the business. Sometimes you see that, it's something that we expect will, you know, steadily allow our or a long distance to continue to grow as we move on. So these are some of the new services that we continue to develop and to ensure that as a group, we continue to progress and remain the forefront of innovation.

Next slide really is about the FinTech ecosystem that we have built. So there's a chart that we showed every quarter and that we update some of the numbers along the way. So the way to look at this chart is that IFC self as a platform offering a whole range of services on the one side will be all the different product provider that we are working with on a business partner, including the different exchanges that we connect to changes that we connect to and now that we have bank, the central bank that we indicated there. On the right side would be the different distribution channels. All right, you have B2C channel, the direct channel, but we also work with various companies, over 700 companies, Among them, there are more than 13,000 advisors within this over 700 companies and that forms part of the overall distribution network that we actually have that continue to expand. So as a platform, we started off with platform offering capability in the unit trust space, that capability with broadening and three years ago that includes addition of the bank.

So that's a way to look at this financial ecosystem. So increasingly you have noticed in the last two years, three years, we've been talking about truly global business model, whereby we're talking operating from a few countries, but you're able to tap into customers from around the world. And we are very keen on having a bank because we feel that a bank will allow us to do that much better. And our experience of the last

one-half years certainly has shown that this truly global business model that we've been talking about It's actually working well and it has a lot of potential. Next slide. Yeah, so next couple of slides basically included some charts showing the net inflow and subscription numbers for our core business. So net inflow for the World Wealth Management Platform in 2024 as a whole, it was 3.3 billion. In the fourth quarter itself, it was 1 billion, so net inflow. So that of course is the key driver for the increase in EUA for us as a World Wealth Management Platform. Next slide will be the chart showing the subscription volume for our unit trust business, which is our core business still and that has been on a healthy trend. Recall that because in 2022 and 2003, it was a very poor market condition. There were some decline, some deep in the volume, but certainly things have actually been improving. That's our overall services have been ramping up. So that's why we're seeing some healthy growth trend right now. is on fixed income and this is for our business in different countries combined. We have our bonds of home-bought, not-rein-moon. With life this year, we expect that that would form a base for us to be able to continue to grow overall. This slide here really is just pinning down the targets that we gave previously for the overall home-call business. We last updated that in February 2024. So we basically just reproduced that set of data and then on the right side we showed the actual numbers that we achieved in 2023 and 2024. So as you can see in 2023 and 2024 we have managed to exceed the data that we originally did now. And with that, that will be the end of this subject group. And yeah, I'll stop here and we'll be happy to take any questions.

Thank you, Chongqing. We'll move on to the Q&A segment. So if you have any questions, please raise your hand and introduce yourself. And for those who have joined us on Zoom, you can also type your question in the Q&A box or you can raise hands and we will unmute you so we can clear your question as well. So perhaps for the attendees who are in the courtroom, anyone wants to ask a question? Andrea? My morning, thank you for the presentation. A few questions from me. I think firstly, I'll touch on the part of profitability for the I-Class Global Bank. I see that most of your more recent revenue streams that's coming from the NII portion of things, do you expect this to still be the driver for growth going forward or are we looking at any new segments that you're going to grow and other associated expenses related to this. I have a couple more but maybe I'll go after this. Yeah for the bank we do expect that

the SII, the interesting comes, will be the biggest driver to wait for. That is of course where there's a recurring stream and that will grow as we grow our deposit base. And enough, we grow deposit base and given by adopting a very conservative stance on the balance sheet, we're able to grow the NII quite well. And of course, as we grow the deposit base and the NII, we find that some corresponding growth in the P income as well. So in the case of the

digital transaction banking, then we find that there are some effects of margins that we are able to grow. As that happens, customers do need to make some conversion of a currency to a different currency. And there is that proportional growth in the fee income as we grow our overall deposit fees in our overall NII. So yeah, essentially, in summary, we expect both B, E, NII to continue to grow, but we think that NII will be a bigger driver. My next question is on these also, I think previously the previous guidance on the expectation was that contributions for slated to come in the first quarter. So I saw in your slides that this has been delayed and even to the end of 2Q 2025. wondering if we could get some updates on what's happening here, why the delay and perhaps you did mention that there is POCs going on with the partner, what's going on there, what kind of trustee size is this and potential size of actually the whole also project that you're looking at.

In terms of the slight delay from first queue to second queue, the main reason is because our partner and our self decided to ensure that the operation so grow out very smoothly when it goes live. We just wanted to make sure that the extra time period is put in to testing other periods of parts of the system in operational part of the work. So that is essentially the the Q&A for some of the day.

As far as going forward and so on, I think at this point in time, yeah, the detailed discussion we're not able to share, but certainly the potential for the growth that's why there's been that ongoing discussion. Okay, thank you. My next question is on collaboration with a partner for the Markkow Pension Project. I think Macau, this is the first time you have mentioned Macau as the potential for growing this e-pension segment. We need to give us any color on your progress there. Are we looking at a partner or what structure would this be like to be more like the MPS structure or more like the also structure where AUA will be counted in your AUA? You mean by the also structure? Something similar in instruction. For this, why are talks as advanced as the board so in such that you are looking that this could potentially contribute to numbers perhaps in 25 years? I suppose on a very short term basis, I wouldn't want to assume too much business or too much revenue on that. but there's something that opens up those growth potential but if you take 2025 on its own I wouldn't want to pursue too much of a new condition. Okay got it so in just putting this together I mean the intention we're going to see a step up as per your guidance as more more trustees get on board it we also have that also project coming in likely in 324Q and with the potential of Mark Cowell into the project coming on board. Is there any potential for upside revision to those Hong Kong targets that you're looking for? We previously had our update in February 2024. I would say that our stick to the same other end is fine. Okay and then just one more question from me on the OPEX for fourth quarter, I didn't realise that the other OPEX line, it was quite a bit lower in the fourth quarter, $1.8 million versus your run rate of $1.5 million in the first three quarters of the year. Was there anything particular that you thought that OPEX to be lower? I would assume that some of the E-Pension or perhaps projected expenses for your E-Pension system goes into this line is that accuracy and is it that in this quarter you just didn't have to expense as much in the end? I think one of the key reasons really is that some of the expenses we

we've made estimates and provision during the year through the different quarters. But towards the end of the year we find a certain estimates that were put in for expenses in the earlier quarters were higher than we actually were in Korea. So with that, you find that there was some adjustment. That's part of the reason. And yeah, that's what it looks like. Will this be a reasonable runway going forward for you to expect this to be more of a... Should I look at it on an annual basis? I think for 2025 we expected to do further increase in operating expenses simply because we have been increasing the resources to ensure that we can cope with a greater onboarding that should be happening. So operating expenses will increase. Thank you. If only me to just add on to that comment. I think in the fourth quarter of 2023 we We did take some amount of impairment on the FBO-CI investments that we have to post. And I think there was also some changes in the effects I think that in the policy levels. So we, yeah, I think that also contributed to that.

Thank you. And I believe we have someone who has raised hand in the Zoom call. So Benjamin. Hi, Chung-Chun, hi, JP. Thanks for this opportunity. I have a few questions. I'll ask them one by one. I think the first one is on your Hong Kong guidance for 2025. You're guiding for 500 million Hong Kong dollars on the PPT line. How should we think about the quarterly speed? Will it be even across the four quarters or first two quarters will be slightly lower than we see a step up in Q3 Q4 as also comes in because if you look at 2020-2024, the quarterly PBT for the Hong Kong business was pretty stable across all four quarters. So how should we think about quarterly split for 2025? I would say that we expect second half to be higher than first half. Yeah, so you won't be equal split across the four quarters in 2025. I think the initial part won't be as high as second half. Okay, but will you be fair to assume the first half on a quarterly basis would be higher than what we saw in let's say entire 2004 like on the quarterly basis? We yeah we you know don't really give the guidance on the other but I believe this is in that detail.

So I'll say that overall the trend should be healthy. I wouldn't want to be, you know, making very exact statement about the exact profitability each quarter because it is possible sometimes that during certain quarter there will be some additional expense, some reduced expense and so on. But on an overall basis, we would say that

higher number in second half, right? Then the person. Okay, understood. Okay, my second question is on the guidance again. I think in 2024, your PBT for Hong Kong was, you delivered 25% higher than what you guided. Now, one year ago, this question was posed to the IFAS team as well. I think back then, the reasoning why IFAS didn't raise the guidance was that management cited that they will answer to these in China and Hong Kong for the core wealth management business. That's therefore they're not raising the entire Hong Kong business guidance. But if you look at recently over the last few months, sentiment has improved in Hong Kong and China. Your AUA growth in these two markets around 20% YO and YO in 2024, strong growth in Q4 as well. What is holding us back from raising the 2025 guidance? Is it just that we are trying to stay conservative here? I think the business that we have in Hong Kong, you have the two part of the well-machined part of the business and there's also the E-Pension part of the business. There is a high contribution from the E-Pension part of the business. It doesn't profitably lead to the well-meshment part of the business. So as we enter 2025, the recent momentum on well-meshment part of the business seems to be more positive. I think that's true. By the same time, we're also ramping up on our manpower and resources for the the invention business because we are make sure that we can deliver services well. So you know, so that they might then increases in cost and so on. So on the overall basis, we feel that at this point in time, we will not be amending any employment that we should one year. Okay, understood. Okay, my two last questions. The third question here is that for the Macau pension, how big do you think you'll be compared to, let's say, also compared to NPF? And when, let's say, some timeline on when the contribution could realistically start contributing, let's I see probably in 2016, 2027. I think in Macau, there is the new requirement on the pension schemes for a company that is actually being introduced, being rolled out. So that essentially opens up a new opportunity for our business partner and for ourselves. And we find that, yeah, because of that, that potential opens up. But at the same time, we are new to Macau. We haven't done business in Macau before, but we are doing so with our business partner. So at this point in time, I wouldn't want to assume to hire a contribution from this company. Okay, understood. My last one is just on the recent news article that you are looking for more banking licenses in Europe. markets are this and why is the rationale behind it? Thank you. Yeah, so I had an interview with a journalist from this time and so the question I was supposed to be was are we looking for more banking licenses in other countries including those they were operating in such as Hong Kong, Malaysia. So my answer was that we have no plans to apply for banking license in Hong Kong, Malaysia at this point in time.

But we do feel that there are some opportunities that we'd like to explore.

Our business model for banking is IFA's global bank model. So we're looking at the WD2 banking cross-border rather than just being limited to the market that you are in. So that of course is a far more scalable business model.

So with that in mind, then we don't need to have licenses in other countries. We don't need to have licenses in too many countries. But we identify that in a place like European Union, for instance, it would be helpful if we do have a license there, because the European Union, you can get a license in one country and that gives you the ability to more directly market to the whole continent, the whole European Union. So that is interesting kind of opportunity for us to explore. So that's why I was saying that there is an area that we are looking into.

And so the other country that I mentioned is something that is still in our mind, is Singapore because Singapore is our HQ. And we feel that at some point along the way, we would so like to look at opportunity in Singapore. But as of now, no exact banking. Okay, thank you. Just one last follow up on that. Does it mean more acquisitions in your EU or are you just planning to just apply for a banking license? The current plan is to apply because now we are already a group with a bank in our group and we are experienced in running

additional bank so we can directly apply itself having to make acquisition. And thank you, thanks for your time.

Thank you Benjamin. Yes, we have Benjamin as well here. I have a question from the science. Just wondering what the IFA's local bank protection is right? All local banks here are sort of protecting their NIs in the fall interest rates. How do you sort of see that IGV is it? The bank has to go to the fee generating segments more to sort of make up for any fall interest rates. So I suppose if some of the banks say NII is going to fall, I think the right it's also in the context of them passing on very little on your savings account or current account deposits for instance and then in a high interest rate environment they can actually make a good margin good spread. So if interest rates generally fall then what they are able to receive you know, a bit reduced and in terms of what they pass on to the client, then there's not as much room as possible. So I suppose that's why there's the expectation that we're entered into a low interest rate environment couple of years ago. And there might be some. But IFA's global bank is coming from a different starting point. We start off with a situation whereby we are passing on decent rates on the savings account, current account. So our margins on that are not as high as what the local banks are enjoying today. It's also not as high as what the other, in the mainstream banks in UK are enjoying.

And we have, we pass on more also because at the initial stage of services are not as fully developed. Right? By our services are better developed and we do it to be able to make a slightly better budget than what we have done. Plus of course as interest rates get cut by family, learn by fat and so on, then we're able to also correspondingly lower the deposit rates that we pass on to the fund. So in our case, we expect that interest margin for ourselves,

we should be okay as we move forward. In fact, we'll be able to have a slightly better margin As we become more established, our SOP services are better to absorb and as we grow up more services. That's the small question of SOP. Is this the time for China Dazs in Singapore? How is that sort of, how is that efficient for the food? Like now, I mean, I say you opened it, you launched it in example, so it's quite a shock. I understand what I said. So we launched our China Dazs because we... I think we all know that there's a lot of Chinese money that they are already outside China. And a lot of this money want to be in Singapore. So while I first have actually

platform in Singapore, we find that our share of the Chinese money that's as we in Singapore want to come to Singapore, isn't as high as it can be. It should be going forward. And we feel that that's because the services that we are providing probably isn't as well set up as it can be. And that's an important part of the reason why we launched China desk, right? including having Chinese colleagues based here in Singapore, and they will allow us to better serve the Chinese story. So that really is a program.

Thank you. We have a few questions in the Q&A box, so maybe I'll go through some of them now. So I think for Royston and Kelvin, I think most of the questions I think you've raised or perhaps even other issues you've raised have been answered by the Chiang Chun. So we'll move on to maybe a bit more on the bank. So I think I'm leaking. So what makes IFAS Global Bank's offerings unique and superior to competitors? What are IFAS Global Bank's plans for geographic expansion and market penetration? And can you share what is the growth potential over the next three to five years? For example, in terms of customer deposits or other relevant metrics?

On the first question, what makes our offering unique? I'll say that the most obvious point for a start really is positioning as an IFA's global bank.

So I've actually been mentioning that in the last 10 years, 20 years, internet has transformed the business world.

in a major way. Start up with media. I think technically SPH and media power are still monopolies in some way, but we know that the media scene has changed completely. We have also seen that changes happening in various other industry, e-commerce. We have seen that happen in the the movie streaming, music industry, the likes of Netflix, Spotify, major giants in the world right now. They all break from one or a couple of countries, but customers from around the world.

And the business model from what I can see are the most scalable and the most competitive. So these are major giants right now. So internet has changed the world in a big way. But interestingly, in the banking world, you actually find that

it hasn't changed in the region.

Banking, especially retail banking, isn't still very much a localized business. If you look at what most retail banks do, they are essentially just trying to cater to local residents. But for a business where there's no fiscal moment, why would that have to be soon? So banking in our view will eventually become a business that is far more globalized than it is today. We know for a fact that many people from around the world do want to have a bank account outside their global country. Maybe among the Singaporeans, not that many, but put Singaporeans aside, I think you should find that people in many different countries, they do one, who have bank account outside the home country. They give them some advantages. One would be some personal diversification for personal reasons. Two would be the currency. they would want to have a account for US dollar that pay decent rates. But I think whose banks, I think they pay, you know, south cattle rate in the local currency, but when it comes to some global currency, including the Asia high currencies, they actually pay very little for the deposit fees. So in our mind, this is really the very clear opportunity that is actually And that's why, you know, after we bought the bank, we are talking about truly global business model where we go out to try to tap into this opportunity. And the last one-half years, last 20 months, you know, since we launched digital personal banking that has told us that our vision for that is in fact well-founded. I think today we have customers from close to 100 countries have open economy with us.

And I think 65% of our deposits for FSL Global Bank

coming from non-UK residents. So for this non-resident segment of the market, we are actually very different. It's actually not easy to open bank account, also in your home country, unless you have millions of dollars. Singapore, of course, is a very successful work management center, very successful private banking center, and lots of private banks operate here and is really operating a global business model. customers from around the world, they put lots of money from banks in Singapore.

But private banks limit themselves to just high network space. So private banks want customers with millions of dollars in their account. But if you just want to open an account where you put in $20,000, $50,000, $100,000, then you actually find that it is difficult to find a bank that that is happy to be very open.

And that is an interesting opportunity that's actually in the banking world. And that is the part of the opportunity that we seek to take into. And the initial one and a half years of our progress have told us that I think we are the right. Yeah, so in terms of uniqueness, I would say that the business model, that is I think the most unique point of our business. We cater to the retail and MesoFlute clients and we just provide, I'll call it simple, some of it simple because you're talking about dealing deposits and covering the town, some payments of this source.

selling complicated products. So for the simple surveys, I think we're meeting the

demand that's actually out there and there's a long way to go for us on this.

I think Li-King and Alan as well, one question is do you have a target for the bank deposits for 2025 and beyond. I think we're still at the initial stage of our growth for our first local bank. So we believe that having this possible for us to shoot for a doubling of deposit base, for instance, for IFA's Google Bank in 2025. I think that is 100% role in the project base. It is possible for us to do it. OK, thank you. We'll go to Ryan's questions. So he has a few questions. So the first one, if I strip out changes and deposits, cash flows from operations have been depressed over the last few years. How do you think about the cash generative abilities of the core company and the cash requirements of the banking operation. I think if you sweep out the deposits on a bank,

the cash flow will actually be from the well-measured platform as well as our expansion. I think the nature of this business is clearly very cash generated. It really is something that will be giving us a very good cash flow, especially before. But in a very short term, sometimes on a quarterly basis and so on, you actually find that for the expansion part of the business, yeah, at times the cash flow doesn't come in equally on a quarterly basis, because we are still in the ramp up stage. We are still at the stage where we are ramping up the resources, the manpower, we are still at the stage where the services that are providing are still new and so on. So for various operational reasons, I think there are some short term mismatch in terms of actual cash flow from this part of the business. I would say that would be a clear reason. Another reason to look at it. I think that's quite accurate. Yeah, that would be a main reason. But on the overall business perspective, you find that

cash flow will be there. Yeah, and Ryan's next question, Are there any talks surrounding additional pension administration or similar contracts in addition to the collaboration in Macau?

I think for also business, business that we will be having discussions with the potential partner on ongoing basis.

Yeah, but I think on a on an immediate basis, we don't have further updates to give you this point. A couple more questions from Ryan. So this one on what percentage of total net revenue is NII now and how do you think about interest rate risk? What rates are you most exposed to?

Yeah maybe I'll answer this one. I think at the moment if you look at the way we've been generating income it's mainly fee-based right so I think the NII is a new part of business and I think it's approximately just I think for less than 5% of total revenue for

total debt revenue for 24. So I guess the thinking on the group would still continue to generate very healthy fee-based income. I think NII will grow. I think we had earlier discussion about the real potential of the bank and of course NII would be poor to them. I think over time you start to see the NII make a larger contribution but at the same time our starting point as a wealth platform has been quite different compared to where most banks start which is NII and then moving to fee income. I think we are at this sweet spot where NII will make quite a good difference to do the revenues going forward, but we still enjoy the core wealth management fee-based income and that forms a foundation of our net revenues. So I think if you look at many banks, NII contributes 60-70% of their net revenue. In our case, as Teran just mentioned, we start out 100% percent fee income without the NNI before we bought the bank. Now that we have a bank and as that grew, then the contribution from NNI will increase. But we expect that on the overall group, the majority of our network will still be fee income, which will be cash as we go. And Ryan's next question was, do you require M&A to achieve or reach the 100 billion EUA target? Our target doesn't assume M&A because we are always open to opportunities that come along but when we in down the target we believe that to be a number that is achievable if we execute well below.

Thank you. Any questions from those who are present here? If not, I'll go back to Q and A. Oh, sorry. Yes. Yeah, thanks for a pop up, Philip. Thanks for letting me ask a question. Just two questions. The first is just on the opening of bank accounts for non-residents, was there any technology or compliance pinpoint that you managed to resolve? That's why you're getting these floats. And the second one is just on the, in Singapore itself, just are you facing any pressure on the trailer fees or even platform fees with competition? Thanks. On the bank account, In terms of opening bank account, it looks like a country. The reality is there's no regulation that should be prevented. So banks can open bank accounts for various residents from various countries, certainly in the UK and in Singapore certainly. for some country for specific banks, they may have some restrictions, but by and large, there isn't actually the regulatory restriction. So most of the time it's actually a matter of choice of a business model by the respective bank. I think for historical reason, most banks prefer to get a million

to local restaurant. So that is truly the main reason. Of course, to be able to execute this business model well, then it has to be a digital solution. It has to be a digital bank. And most banks are still a combination of digital and

break and mortar. So not all banks want to have this kind of business model that we have in in the background.

Secondly, on the trailer fees, the question about when is the operation on the trailer fee and the platform fee?

I would say that on the trailer fee as a distributor, we don't think there's a downward operation on the trailer fee. I think generally distributors who have the volume readily sizable distributor, then they do have the pricing power. But I suppose the trends that would probably be emerging is more of a, not a direct pressure and the trailer fee, but it's more of some shift of investor demand from unit trust to the ETF. So ETF generally doesn't come with trailer fee, or it is quite little, whereas unit trust mutual fund and the trailer fee. So if there's some shift towards ETF, then on an average basis, there can be some downoperation. So that will probably be the viewpoint. Thank you. We have a couple of questions from the Q&A box, from a few of the analysts and participants. So we go to this topic on e-pension. So from Alan, what will be the next step up in Hong Kong expansion contribution?

The next step up, so as I was mentioning, we expect it to be second half in terms of the next step up. OK. And I think you may have answered it a little bit, but Royston has this point. The management offer any Hong Kong revenue and PBT guidance for 2026 and beyond now that we are in 2025.

Yeah, I think generally speaking, we don't really offer exact guidance

for the various individual country. In the case of Hong Kong, we did that since, you know, two or three years ago. And the reason why we did that was because invention, if it is something so new, and we wanted to give shareholders a better understanding of what roughly to expect, and for that reason we gave some some guidance. Now that things have been ongoing, so it is not our intention to give more specific guidance by country every year. So that's not the overall intention.

The last question on e-pension from our Q&A participants is from Ryan. Could you help me understand the cash payment characteristics of the e-pension contract? How frequently are you paid in cash? And how does that differ from how you recognize the revenue? Generally speaking, People say that the cash flow will be on a monthly and quarterly basis. That's how we are supposed to be paid. Having said that, I think in certain months or certain quarters, there can be some differences in timing for some operational reason. that's related to the stage of the operational ramp up of operational growth. By and large, on a general basis, it should be there every quarter. But yeah, probably in the initial one year, two years, then on a short term quarterly basis, there's some difference in the actual We see the potential. It's from Royston. Where is the dividend outlook for the year? And can dividends continue to rise year on year in 2025? So for dividend, some years ago, before we went to the banking business, at one time, we were targeting to pay about 15% of our net profit as dividend. But now they went to banking,

and given our very strong ambition for growth,

and given the banking is a business that requires a higher capital,

then our current thinking really is that we will continue to grow the digital share each year as our business grew, as our professional living group, In terms of the payout, I don't think we'll be paying 50%. I think for 2024, we paid 26%. I think that probably can be taken as payout. In terms of the payout ratio, it could be become a ballpark range for 2025 as well. So as we grow the profitability, then the detail will grow. And it does appear ratio, it didn't differ very much from quantitative.

Okay, we have a couple of questions still in the Q&A box. So first one, OPEX as a percentage of revenue has been controlled well for FY 2024. How should we expect OPEX to trend going forward? This question is from Pannon. Book packs in absolute number will certainly be increasing to 25, especially because on the E-Pension business, we are still in a station wrapping up our resources so that as onboarding, continue to progress. So in absolute number is certainly in particular. As percentage of revenue, we think that as a group there shouldn't be a deterioration. I think I think maybe the PBT margin chart is probably instructive. So I think as JP pointed out earlier, we have been able to grow this margin. I think 2022 was quite a key year for the group where we took on a lot of new costs on the new banking business. And then as you can see that as you have made progress on the overall platform business, we have been able to then not just cover those costs but also expand that margin. So I guess in relation to where we see this margin, also given what you mentioned earlier about very strong fee-based income from the platform that is highly scalable doesn't require a lot of new operating costs per se. So I think also to answer the operating question, for Chiang Chun says we expect an increase, I think the increases will largely be targeted at the new areas of the business, particularly areas like the bank and probably some of the new services. So I think there's also a question on whether we expect operating leverage. I think we have always been poised to capitalize on any increases on the net revenues by keeping our cost consistent. Indeed, there's a question from Lokan on the operating leverage possibilities from here and also very specifically how much will OPEX grow for 25% AUA growth next year? A bit difficult to pin down the exact number, but I believe that for 2025, there's room for some expansion in the community. Are there any questions from our participants here? No, we have also appeared to questions from our virtual participants. Thank you. So that will end our session. Thank you. Take care everybody. Thank you. Thank you. again soon. Thank you.