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Item 7. Management’s Discussion and Analysis

2023-03-01 compared with 2022-02-28 · 469 added, 568 removed, 1110 unchanged (48% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of BGC Partners’ financial condition and results of operations should be read together with BGC Partners, Inc.’s consolidated financial statements and notes to those statements, as well as the cautionary statements relating to forward-looking statements included in this report.

The following discussion of BGC Partners’ financial condition and results of operations should be read together with BGC Partners' Consolidated Financial Statements and notes to those statements, as well as the cautionary statements relating to forward-looking statements included in this report.

When used herein, the terms “BGC Partners,” “BGC,” the “Company,” “we,” “us” and “our” refer to BGC Partners, Inc., including consolidated subsidiaries.

The objective of this Management’s Discussion and Analysis is to allow investors to view the Company from management’s perspective, considering items that would have a material impact on future operations.

The objective of this Management’s Discussion and Analysis is to allow investors to view the Company from management’s perspective, considering items that have had and could have a material impact on future operations.

This discussion summarizes the significant factors affecting our results of operations and financial condition as of and during the years ended December 31, 2022, 2021, and 2020.

3 unchanged sentences

Factors that might cause or contribute to such a discrepancy include, but are not limited to, the factors set forth below:

• the impact of the COVID-19 pandemic, including possible successive waves or variants of the virus, on our operations, including the continued ability of our executives, employees, customers, clients, third-party service providers, exchanges and other facilities to perform their functions at normal levels and the availability of the requisite technology to execute trades in certain Fully Electronic offerings while working remotely;

• macroeconomic and other challenges and uncertainties resulting from the COVID-19 pandemic, such as the distribution of effective vaccines, public acceptance of the vaccines, and governmental and public reactions thereto, the U.S.

and global economies, financial markets and consumer and corporate clients and customers, including economic activity, employment levels and market liquidity, as well as the various actions taken in response to the challenges and uncertainties by governments, central banks and others, including us;

• market conditions, including trading volume and volatility in the demand for the products and services we provide, resulting from the effects of COVID-19 or otherwise, possible disruptions in trading, potential deterioration of equity and debt capital markets, impact of significant changes in interest rates and our ability to access the capital markets as needed or on reasonable terms and conditions;

• macroeconomic and other challenges and uncertainties resulting from the COVID-19 pandemic, Russia's Invasion of Ukraine, rising global interest rates, inflation and the Federal Reserve's responses thereto, including increasing interest rates, the strengthening U.S.

dollar, changes in the U.S.

and global economies and financial markets, including economic activity, employment levels, supply chain issues and market liquidity, and increasing energy costs, as well as the various actions taken in response to the challenges and uncertainties by governments, central banks and others, including us and consumer and corporate clients and customers;

• the impact of the COVID-19 pandemic, including possible successive waves or variants of the virus, the emergence of new viruses, the continued distribution of effective vaccines and governmental and public reactions thereto, the combined impact of the flu and other seasonal illnesses, and the impact of a return to office for our employees on our operations;

• market conditions, including rising interest rates, the strengthening U.S.

dollar, trading volume, currency fluctuations and volatility in the demand for the products and services we provide, resulting from the effects of COVID-19 or otherwise, possible disruptions in trading, potential deterioration of equity and debt capital markets and cryptocurrency markets, the impact of significant changes in interest rates generally and on our ability to access the capital markets as needed or on reasonable terms and conditions;

• pricing, commissions and fees, and market position with respect to any of our products and services and those of our competitors;

• the effect of industry concentration and reorganization, reduction of customers, and consolidation;

• liquidity, regulatory, cash and clearing capital requirements and the impact of credit market events, including the impact of COVID-19 and actions taken by governments and businesses in response thereto on the credit markets and interest rates;

• our relationships and transactions with Cantor and its affiliates, including CF&Co, and CCRE, our structure, including BGC Holdings, which is owned by us, Cantor, our employee partners and other partners, and the BGC OpCos, which are owned jointly by us and BGC Holdings, any possible changes to our structure, any related transactions, conflicts of interest or litigation, any impact of Cantor’s results on our credit ratings and associated outlooks, any loans to or from us or Cantor, BGC Holdings, or the BGC OpCos, including the balances and interest rates thereof from time to time and any convertible or equity features of any such loans, CF&Co’s acting as our sales agent or underwriter under our CEO program or other offerings, Cantor’s holdings of the Company’s Debt Securities, CF&Co’s acting as a market maker in the Company’s Debt Securities, CF&Co’s acting as our financial advisor in connection with potential acquisitions, dispositions, or other transactions and our participation in various investments, stock loans or cash management vehicles placed by or recommended by CF&Co;

• the integration of acquired businesses with our other businesses;

• liquidity, regulatory, cash and clearing capital requirements and the impact of credit market events, including the impact of COVID-19, rising interest rates, the strengthening U.S.

dollar, and market uncertainty, and political events and conflicts and actions taken by governments and businesses in response thereto on the credit markets and interest rates;

• our relationships and transactions with Cantor and its affiliates, including CF&Co, and CCRE, our structure, including BGC Holdings, which is owned by us, Cantor, our employee partners and other partners, and the BGC OpCos, which are owned jointly by us and BGC Holdings, the timing and impact of any possible changes to our structure, including the Corporate Conversion, any related transactions, conflicts of interest or litigation, including with respect to executive compensation matters, any impact of Cantor’s results on our credit ratings and associated outlooks, any loans to or from us or Cantor, BGC Holdings, or the BGC OpCos, including the balances and interest rates thereof from time to time and any convertible or equity features of any such loans, CF&Co’s acting as our sales agent or underwriter under our CEO Program or other offerings, Cantor’s holdings of the Company’s Debt Securities, CF&Co’s acting as a market maker in the Company’s Debt Securities, CF&Co’s acting as our financial advisor in connection with potential acquisitions, dispositions, or other transactions, and our participation in various investments, stock loans or cash management vehicles placed by or recommended by CF&Co;

• the structural, financial, tax, employee retention and other impacts of our expected Corporate Conversion;

• the integration of acquired businesses and their operations and back office functions with our other businesses;

• the effect on our businesses of any extraordinary transactions, including the Corporate Conversion, the timing and terms of any such transaction, including potential dilution, taxes, costs, and other impacts, and our ability to complete such transaction on our anticipated schedule;

• the rebranding of our current businesses or risks related to any potential dispositions of all or any portion of our existing or acquired businesses;

• market volatility as a result of the effects of COVID-19, which may not be sustainable or predictable in future periods;

• economic or geopolitical conditions or uncertainties, the actions of governments or central banks, including the impact of COVID-19 on the global markets and governmental responses, and restrictions on business and commercial activity, uncertainty regarding the nature, timing and consequences of Brexit following the withdrawal process, including potential reduction in investment in the U.K., and the pursuit of trade, border control or other related policies by the U.S.

and/or other countries (including U.S.-China trade relations), political and labor unrest in France, Hong Kong, China, and other jurisdictions, conflict in the Middle East, Russia, Ukraine or other jurisdictions, the impact of U.S.

government shutdowns, elections, political unrest or stalemates in response to governmental mandates and other restrictions related to COVID-19 in the U.S.

or abroad, and the impact of terrorist acts, acts of war or other violence or political unrest, as well as natural disasters or weather-related or similar events, including hurricanes as well as power failures, communication and transportation disruptions, and other interruptions of utilities or other essential services and the impacts of pandemics and other international health emergencies, including COVID-19;

• the effect on our businesses, our clients, the markets in which we operate, our possible restructuring, and the economy in general of changes in the U.S.

and foreign tax and other laws, including changes in tax rates,

repatriation rules, and deductibility of interest, potential policy and regulatory changes in Mexico and other countries, sequestrations, uncertainties regarding the debt ceiling and the federal budget, and other potential political policies;

• the effect on our businesses of changes in interest rates, changes in benchmarks, including the transition away from LIBOR, the level of worldwide governmental debt issuances, austerity programs, government stimulus packages, including those related to COVID-19, increases or decreases in deficits and the impact of increased government tax rates, and other changes to monetary policy, and potential political impasses or regulatory requirements, including increased capital requirements for banks and other institutions or changes in legislation, regulations and priorities;

• market volatility as a result of the effects of rising interest rates, the strengthening U.S.

dollar, global inflation rates, potential economic downturns, including recessions, and similar effects, which may not be predictable in future periods;

• economic or geopolitical conditions or uncertainties, the actions of governments or central banks, including the impact of COVID-19 on the global markets and governmental responses, and restrictions on business and commercial activity, uncertainty regarding the consequences of Brexit following the withdrawal process, including potential reduction in investment in the U.K., and the pursuit of trade, border control or other related policies by the U.S.

and/or other countries (including U.S.-China trade relations), recent economic and political volatility in the U.K., rising political and other tensions between the U.S.

and China, political and labor unrest in Hong Kong, China and other jurisdictions, conflict in the Middle East, Russia, Ukraine or other jurisdictions, the impact of U.S.

government shutdowns, elections, political unrest, boycotts, stalemates or other social and political responses to governmental mandates and other restrictions related to COVID-19 in the U.S.

or abroad, and the impact of terrorist acts, acts of war or other violence or political unrest, as well as natural disasters or weather-related or similar events, including hurricanes and heat waves, as well as power failures, communication and transportation disruptions, and other interruptions of utilities or other essential services and the impacts of pandemics and other international health emergencies;

• risks inherent in doing business in international markets, and any failure to identify and manage those risks, as well as the impact of Russia's ongoing Invasion of Ukraine and additional sanctions and regulations imposed by governments and related counter-sanctions, including any related reserves;

• the effect on our businesses, our clients, the markets in which we operate, our Corporate Conversion, and the economy in general of changes in the U.S.

and foreign tax and other laws, including changes in tax rates, repatriation rules, and deductibility of interest, potential policy and regulatory changes in other countries, sequestrations, uncertainties regarding the debt ceiling and the federal budget, responses to rising global inflation rates, and other potential political policies;

• our dependence upon our key employees, our ability to build out successful succession plans, the impact of absence due to illness or leave of certain key executive officers or employees and our ability to attract, retain, motivate and integrate new employees, as well as the competing demands on the time of certain of our executive officers who also provide services to Cantor, Newmark and various other ventures and investments sponsored by Cantor;

• the effect on our businesses of changes in interest rates, changes in benchmarks, including the transition away from LIBOR, the transition to alternative benchmarks such as SOFR, the effect on our business and revenues of the strengthening U.S.

dollar, rising interest rates and market uncertainty, the level of worldwide governmental debt issuances, austerity programs, government stimulus packages, increases and decreases in the federal funds interest rate and other actions to moderate inflation, increases or decreases in deficits and the impact of increased government tax rates, and other changes to monetary policy, and potential political impasses or regulatory requirements, including increased capital requirements for banks and other institutions or changes in legislation, regulations and priorities;

• extensive regulation of our businesses and customers, changes in regulations relating to financial services companies and other industries, and risks relating to compliance matters, including regulatory examinations, inspections, investigations and enforcement actions, and any resulting costs, increased financial and capital requirements, enhanced oversight, remediation, fines, penalties, sanctions, and changes to or restrictions or limitations on specific activities, including potential delays in accessing markets, including due to our regulatory status and actions, operations, compensatory arrangements, and growth opportunities, including acquisitions, hiring, and new businesses, products, or services;

• factors related to specific transactions or series of transactions, including credit, performance, and principal risk, trade failures, counterparty failures, and the impact of fraud and unauthorized trading;

• the effect on our businesses of any extraordinary transactions, including the possible restructuring of our partnership into a corporate structure, including potential dilution and other impacts;

• costs and expenses of developing, maintaining, and protecting our intellectual property, as well as employment, regulatory, and other litigation and proceedings, and their related costs, including judgments, indemnities, fines, or settlements paid and the impact thereof on our financial results and cash flows in any given period;

• certain financial risks, including the possibility of future losses, reduced cash flows from operations, increased leverage, and the need for short- or long-term borrowings, including from Cantor, our ability to refinance our indebtedness, and changes to interest rates and liquidity or our access to other sources of cash relating to acquisitions, dispositions, or other matters, potential liquidity and other risks relating to our ability to maintain continued access to credit and availability of financing necessary to support our ongoing business needs, on terms acceptable to us, if at all, and risks associated with the resulting leverage, including potentially causing a reduction in our credit ratings and the associated outlooks and increased borrowing costs as well as interest rate and foreign currency exchange rate fluctuations;

• certain financial risks, including the possibility of future losses, indemnification obligations, assumed liabilities, reduced cash flows from operations, increased leverage, reduced availability under our credit agreements, and the need for short- or long-term borrowings, including from Cantor, our ability to refinance our indebtedness, and changes to interest rates and liquidity or our access to other sources of cash relating to acquisitions, dispositions, or other matters, potential liquidity and other risks relating to our ability to maintain continued access to credit and availability of financing necessary to support our ongoing business needs, on terms acceptable to us, if at all, and risks associated with the resulting leverage, including potentially causing a reduction in our credit ratings and the associated outlooks and increased borrowing costs as well as interest rate and foreign currency exchange rate fluctuations;

• risks associated with the temporary or longer-term investment of our available cash, including in the BGC OpCos, defaults or impairments on our investments, joint venture interests, stock loans or cash management vehicles and collectability of loan balances owed to us by partners, employees, the BGC OpCos or others;

• our ability to enter new markets or develop new products, offerings, trading desks, marketplaces, or services for existing or new clients, including our ability to expand our cryptocurrency offerings including the launch of additional cryptocurrency and digital asset trading offerings in 2022 and efforts to convert certain existing products to a Fully Electronic trade execution, and to induce such clients to use these products, trading desks, marketplaces, or services and to secure and maintain market share, including changes to the likelihood or timing of such efforts due to COVID-19 or other measures;

• the impact of any restructuring or similar transactions on our ability to enter into marketing and strategic alliances and business combinations or other transactions in the financial services and other industries, including acquisitions, tender offers, dispositions, reorganizations, partnering opportunities and joint ventures, the failure to realize the anticipated benefits of any such transactions, relationships or growth and the future impact of any such transactions, relationships or growth on our other businesses and our financial results for current or future periods, the integration of any completed acquisitions and the use of proceeds of any completed dispositions, and the value of and any hedging entered into in connection with consideration received or to be received in connection with such dispositions and any transfers thereof;

• our ability to enter new markets or develop new products, offerings, trading desks, marketplaces, or services for existing or new clients, including our ability to develop new Fenics platforms and products, to successfully launch our FMX initiative and to attract investors thereto, the risks inherent in operating our cryptocurrency business and in safekeeping cryptocurrency assets, and efforts to convert certain existing products to a Fully Electronic trade execution, and to induce such clients to use these products, trading desks, marketplaces, or services and to secure and maintain market share;

• the impact of any restructuring or similar transactions, including the Corporate Conversion, on our ability to enter into marketing and strategic alliances and business combinations, attract investors or partners or engage in other transactions in the financial services and other industries, including acquisitions, tender offers, dispositions, reorganizations, partnering opportunities and joint ventures, the failure to realize the anticipated benefits of any such transactions, relationships or growth, and the future impact of any such transactions, relationships or growth on our other businesses and our financial results for current or future periods, the integration of any completed acquisitions and the use of proceeds of any completed dispositions, the impact of amendments and/or terminations of strategic arrangements, and the value of and any hedging entered into in connection with consideration received or to be received in connection with such dispositions and any transfers thereof;

• our estimates or determinations of potential value with respect to various assets or portions of our businesses, such as Fenics, including with respect to the accuracy of the assumptions or the valuation models or multiples used;

• our ability to manage turnover and hire and retain personnel, including brokers, salespeople, managers, technology professionals and other front-office personnel, and departures of senior personnel;

• our ability to expand the use of technology for Hybrid and Fully Electronic trade execution in our product and service offerings;

• our ability to effectively manage any growth that may be achieved, while ensuring compliance with all applicable financial reporting, internal control, legal compliance, and regulatory requirements;

• our ability to manage turnover and hire, train, integrate and retain personnel, including brokers, salespeople, managers, technology professionals and other front-office personnel, back-office and support services, and departures of senior personnel;

• our ability to expand the use of technology and maintain access to the intellectual property of others for Hybrid and Fully Electronic trade execution in our product and service offerings, and otherwise;

• our ability to effectively manage any growth that may be achieved, including outside the U.S., while ensuring compliance with all applicable financial reporting, internal control, legal compliance, and regulatory requirements;

• our ability to identify and remediate any material weaknesses or significant deficiencies in our internal controls which could affect our ability to properly maintain books and records, prepare financial statements and reports in a timely manner, control our policies, practices and procedures, operations and assets, assess and manage our operational, regulatory and financial risks, and integrate our acquired businesses and brokers, salespeople, managers, technology professionals and other front-office personnel;

• the impact of unexpected market moves and similar events;

• information technology risks, including capacity constraints, failures, or disruptions in our systems or those of the clients, counterparties, exchanges, clearing facilities, or other parties with which we interact, including increased demands on such systems and on the telecommunications infrastructure from remote working during the COVID-19 pandemic, cyber-security risks and incidents, compliance with regulations requiring data minimization and protection and preservation of records of access and transfers of data, privacy risk and exposure to potential liability and regulatory focus;

data minimization and protection and preservation of records of access and transfers of data, privacy risk and exposure to potential liability and regulatory focus;

• the effectiveness of our governance, risk management, and oversight procedures and impact of any potential transactions or relationships with related parties;

• the impact of our ESG or “sustainability” ratings on the decisions by clients, investors, ratings agencies, potential clients and other parties with respect to our businesses, investments in us or the market for and trading price of BGC Class A common stock, Company Debt Securities, or other matters;

• the impact of our ESG or “sustainability” ratings on the decisions by clients, investors, ratings agencies, potential clients and other parties with respect to our businesses, investments in us, our borrowing opportunities or the market for and trading price of BGC Class A common stock, Company Debt Securities, or other matters;

• the fact that the prices at which shares of our Class A common stock are or may be sold in offerings, acquisitions, or other transactions may vary significantly, and purchasers of shares in such offerings or other transactions, as well as existing stockholders, may suffer significant dilution if the price they paid for their shares is higher than the price paid by other purchasers in such offerings or transactions;

• the impact of reductions to our dividends and distributions and the timing and amounts of any future dividends or distributions, including our ability to meet expectations with respect to payments of dividends and distributions and repurchases of shares of our Class A common stock and purchases or redemptions of limited partnership interests in BGC Holdings, or other equity interests in us or any of our other subsidiaries, including the BGC OpCos, including from Cantor, our executive officers, other employees, partners, and others, and the net proceeds to be realized by us from offerings of shares of BGC Class A common stock and Company Debt Securities;

• the effect on the markets for and trading prices of our Class A common stock and Company Debt Securities due to COVID-19 and other market factors as well as on various offerings and other transactions, including offerings of our Class A common stock and convertible or exchangeable debt or other securities, our repurchases of shares of our Class A common stock and purchases or redemptions of BGC Holdings limited partnership interests or other equity interests in us or in our subsidiaries, any exchanges by Cantor of shares of our Class A common stock for shares of our Class B common stock, any exchanges or redemptions of limited partnership units and issuances of shares of our Class A common stock in connection therewith, including in corporate or partnership restructurings, our payment of dividends on our Class A common stock and distributions on limited partnership interests in BGC Holdings and the BGC OpCos, convertible arbitrage, hedging, and other transactions engaged in by us or holders of our outstanding shares, Company Debt Securities, share sales and stock pledge, stock loans, and other financing transactions by holders of our shares (including by Cantor or others), including of shares acquired pursuant to our employee benefit plans, unit exchanges and redemptions, corporate or partnership restructurings, acquisitions, conversions of shares of our Class B common stock and our other convertible securities into shares of our Class A common stock, stock pledge, stock loan, or other financing transactions, and distributions of our Class A common stock by Cantor to its partners, including the April 2008 and February 2012 distribution rights shares.

• the effect on the markets for and trading prices of our Class A common stock and Company Debt Securities due to COVID-19 and other market factors as well as on various offerings and other transactions, including offerings of our Class A common stock and convertible or exchangeable debt or other securities, our repurchases of shares of our Class A common stock and purchases or redemptions of BGC Holdings limited partnership interests or other equity interests in us or in our subsidiaries, any exchanges by Cantor of shares of our Class A common stock for shares of our Class B common stock, any exchanges or redemptions of limited partnership units and issuances of shares of our Class A common stock in connection therewith, including in corporate or partnership restructurings, our payment of dividends on our Class A common stock and distributions on limited partnership interests in BGC Holdings and the BGC OpCos, convertible arbitrage, hedging, and other transactions engaged in by us or holders of our outstanding shares, Company Debt Securities or other securities, share sales and stock pledge, stock loans, and other financing transactions by holders of our shares (including by Cantor or others), including of shares acquired pursuant to our employee benefit plans, unit exchanges and redemptions, corporate or partnership restructurings, acquisitions, conversions of shares of our Class B common stock and our other convertible securities into shares of our Class A common stock, and distributions of our Class A common stock by Cantor to its partners, including the April 2008 and February 2012 distribution rights shares.

The foregoing risks and uncertainties, as well as those risks and uncertainties discussed under the headings “Item 1A—Risk Factors,” and “Item 7A—Quantitative and Qualitative Disclosures About Market Risk” and elsewhere in this Form 10-K, may cause actual results and events to differ materially from the forward-looking statements.

OVERVIEW AND BUSINESS ENVIRONMENT

We are a leading global financial brokerage and technology company servicing the global financial markets.

Through brands including BGC®, GFI®, Sunrise Brokers™, Poten & Partners®, RP Martin™, and Fenics®, among others, our businesses specialize in the brokerage of a broad range of products, including fixed income such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives.

We also broker products across FX, equity derivatives and cash equities, energy and commodities, shipping, and futures and options.

We have also recently announced our plans to develop new and comprehensive cryptocurrency brokerage offerings.

BGC is a leading global financial brokerage and technology company servicing the global financial markets.

Through brands including BGC®, Fenics®, GFI®, Sunrise Brokers™, Poten & Partners®, and RP Martin®, among others, our businesses specialize in the brokerage of a broad range of products, including fixed income such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives.

Additionally, we provide brokerage products across FX, Equities, Energy and Commodities, Shipping, and Futures and Options.

Our businesses also provide a wide variety of services, including trade execution, connectivity solutions, brokerage services, clearing, trade compression, and other post-trade services, information, and other back-office services to a broad assortment of financial and non-financial institutions.

Our integrated platform is designed to provide flexibility to customers with regard to price discovery, execution and processing of transactions, and enables them to use voice, hybrid, or in many markets, fully electronic brokerage services in connection with transactions executed either OTC or through an exchange.

Through our Fenics® group of electronic brands, we offer a number of market infrastructure and connectivity services, fully electronic marketplaces, and the fully electronic brokerage of certain products that also may trade via voice and hybrid execution.

The full suite of Fenics® offerings includes fully electronic and hybrid brokerage, market data and related information services, trade compression and other post-trade services, analytics related to financial instruments and markets, and other financial technology solutions.

Fenics® brands also operate under the names Fenics®, FMX™, BGC Trader™, CreditMatch®, Fenics Market Data™, Fenics GO™, BGC Market Data™, kACE 2 ®, Capitalab®, Swaptioniser®, CBID®, Lucera® and LumeAlfa™.

BGC, BGC Partners, BGC Trader, GFI, GFI Ginga, CreditMatch, Fenics, Fenics.com, FMX, Sunrise Brokers, Poten & Partners, RP Martin, kACE 2 , Capitalab, Swaptioniser, CBID, Aqua, Lucera and LumeAlfa are trademarks/service marks, and/or registered trademarks/service marks of BGC Partners, Inc.

Our integrated platform is designed to provide flexibility to customers with regard to price discovery, execution and processing of transactions, and enables them to use our Voice, Hybrid, or, in many markets, Fully Electronic brokerage services in connection with transactions executed either OTC or through an exchange.

Through our Fenics® group of electronic brands, we offer a number of market infrastructure and connectivity services, including our Fully Electronic marketplaces, and the Fully

Electronic brokerage of certain products that also may trade via our Voice and Hybrid execution platforms.

The full suite of Fenics® offerings includes our Fully Electronic and Hybrid brokerage, market data and related information services, trade compression and other post-trade services, analytics related to financial instruments and markets, and other financial technology solutions.

Fenics® brands also operate under the names Fenics®, FMX™, FMX Futures Exchange™, Fenics Markets Xchange™, Fenics Futures Exchange™, Fenics UST™, Fenics FX™, Fenics Repo™, Fenics Direct™, Fenics MID™, Fenics Market Data™, Fenics GO™, Fenics PortfolioMatch™, kACE2®, and Lucera®.

BGC, BGC Partners, BGC Trader, GFI, GFI Ginga, CreditMatch, Fenics, Fenics.com, FMX, Sunrise Brokers, Poten & Partners, RP Martin, kACE2, Capitalab, Swaptioniser, CBID, and Lucera are trademarks/service marks, and/or registered trademarks/service marks of BGC Partners, Inc.

and/or its affiliates.

Our customers include many of the world’s largest banks, broker-dealers, investment banks, trading firms, hedge funds, governments, corporations, and investment firms.

We have dozens of offices globally in major markets including New York and London, as well as in Bahrain, Beijing, Bermuda, Bogotá, Brisbane, Buenos Aires, Chicago, Copenhagen, Dubai, Dublin, Frankfurt, Geneva, Hong Kong, Houston, Istanbul, Johannesburg, Madrid, Melbourne, Mexico City, Miami, Milan, Monaco, Moscow, Nyon, Paris, Rio de Janeiro, Santiago, São Paulo, Seoul, Shanghai, Singapore, Sydney, Tel Aviv, Tokyo, Toronto, and Zurich.

As of December 31, 2021, we had approximately 2,100 brokers, salespeople, managers, technology professionals and other front-office personnel across our businesses.

Futures Exchange Group

On July 30, 2021, the Company completed the purchase of the Futures Exchange Group for a purchase price of $4.9 million at closing, plus the cash held at closing by the Futures Exchange Group, and an earn-out, only payable out of our portion of the profits of the Futures Exchange Group, capped at the amount Cantor contributed to the Futures Exchange Group prior to closing.

The Futures Exchange Group acquisition has been determined to be a combination of entities under common control that resulted in a change in the reporting entity.

Accordingly, the financial results of the Company have been recast to include the financial results of the Futures Exchange Group in the current and prior periods as if the Futures Exchange Group had always been consolidated.

The assets and liabilities of the Futures Exchange Group have been recorded in the Company's consolidated statements of financial condition at the seller's historical carrying value.

The purchase of the Futures Exchange Group was accounted for as an equity transaction for the period ended September 30, 2021 (the period in which the transaction occurred).

The following tables summarize the impact of the Futures Exchange Group acquisition to the Company's consolidated statement of financial condition as of December 31, 2020, and to the Company's consolidated statements of operations for the years ended December 31, 2020 and 2019 (in thousands, except per share amounts):

December 31, 2020

As Previously Reported Retrospective Adjustments As Adjusted

Total assets $ 3,949,300 $ 3,942 $ 3,953,242

Total liabilities $ 3,120,397 $ 874 $ 3,121,271

Total equity $ 808,229 $ 3,068 $ 811,297

Total liabilities, redeemable partnership interest, and equity $ 3,949,300 $ 3,942 $ 3,953,242

Year Ended December 31, 2020 Year Ended December 31, 2019

As Previously Reported Retrospective Adjustments As Adjusted As Previously Reported Retrospective Adjustments As Adjusted

Income (loss) from operations before income taxes $ 77,905 $ (5,684) $ 72,221 $ 122,064 $ (5,437) $ 116,627

Consolidated net income (loss) $ 56,602 $ (5,684) $ 50,918 $ 72,253 $ (5,437) $ 66,816

Net income (loss) attributable to noncontrolling interest in subsidiaries $ 7,694 $ (1,838) $ 5,856 $ 24,691 $ (1,776) $ 22,915

Net income (loss) available to common stockholders $ 48,908 $ (3,846) $ 45,062 $ 47,562 $ (3,661) $ 43,901

Basic earnings (loss) per share $ 0.14 $ (0.02) $ 0.12 $ 0.14 $ (0.01) $ 0.13

Diluted earnings (loss) per share $ 0.13 $ (0.01) $ 0.12 $ 0.13 $ (0.01) $ 0.12

Additionally, the consolidated statements of comprehensive income (loss), consolidated statements of cash flows and consolidated statements of changes in equity have been adjusted to reflect these retrospective adjustments.

We have dozens of offices globally in major markets including New York and London, as well as in Bahrain, Beijing, Bogotá, Brisbane, Cape Town, Chicago, Copenhagen, Dubai, Dublin, Frankfurt, Geneva, Hong Kong, Houston, Johannesburg, Madrid, Manila, Melbourne, Mexico City, Miami, Milan, Monaco, Nyon, Paris, Perth, Rio de Janeiro, Santiago, São Paulo, Seoul, Shanghai, Singapore, Sydney, Tel Aviv, Tokyo, Toronto, and Zurich.

As of December 31, 2022, we had 1,985 brokers, salespeople, managers, technology professionals and other front-office personnel across our businesses.

Recent Developments / Strengthening U.S.

The Company generates a significant amount of its revenues in non-U.S.

dollar denominated currencies, particularly in the euro and pound sterling.

dollar remained at strong levels against both the euro and pound sterling, which were approximately 11% and 13% lower, respectively, for the quarter ended December 31, 2022 as compared to the quarter ended December 31, 2021.

The Company's total revenue for the quarter would have been $13.7 million higher, but for the stronger U.S.

The stronger U.S.

dollar is expected to be less impactful on reported revenue throughout 2023.

Recent Developments / Tax Policy Changes

On August 16, 2022, the Inflation Reduction Act of 2022 was signed into federal law.

The IR Act provides for, among other things, a new corporate alternative minimum tax based on 15% of adjusted financial statement income for applicable corporations.

The IR Act also provides for a new U.S.

federal 1% excise tax on certain repurchases (including redemptions) of stock by publicly traded U.S.

corporations and certain U.S.

subsidiaries of publicly traded foreign corporations.

The excise tax is imposed on the repurchasing corporation itself and not its stockholders from which the shares are repurchased.

In addition, certain exceptions apply to the excise tax.

These tax provisions of the IR Act are effective January 1, 2023.

We continue to analyze the impacts of the IR Act and related regulatory developments;

however, it is not expected to have a material impact on our financial statements in future periods.

For the purposes of this document and subsequent SEC filings, all of our higher margin, technology-driven businesses are referred to as Fenics.

1 unchanged sentence

Fenics Markets includes the fully electronic portion of BGC's brokerage businesses, data, software and post-trade revenues that are unrelated to Fenics Growth Platforms, as well as Fenics Integrated revenues.

Fenics Growth Platforms includes Fenics UST, Fenics GO, Lucera, Fenics FX and other newer standalone platforms.

Fenics Growth Platforms includes Fenics UST, Fenics GO, Lucera, Fenics FX, Portfolio Match and other newer standalone platforms.

Revenue generated from data, software and post-trade attributable to Fenics Growth Platforms are included within their related businesses.

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We have been a pioneer in creating and encouraging hybrid and fully electronic execution, and we continually work with our customers to expand such trading across more asset classes and geographies.

Outside of U.S.

Treasuries and spot FX, the banks and financial firms that dominate the OTC markets had, until recent years, been hesitant in adopting electronically traded products.

However, banks, broker-dealers, and other professional trading firms are now much more active in hybrid and fully electronically traded markets across various OTC products, including credit derivative indices, FX derivatives, non-U.S.

sovereign bonds, corporate bonds, and interest rate derivatives.

These electronic markets have grown as a percentage of overall industry volumes for the past few years as firms like BGC have invested in the kinds of technology favored by our customers.

Regulation across banking, capital markets, and OTC derivatives has accelerated the adoption of fully electronic execution, and we expect this demand to continue.

These electronic markets for OTC products have grown as a percentage of overall industry volumes over the past decade as firms like BGC have invested in the kinds of technology favored by our customers.

Regulation across banking,

capital markets, and OTC derivatives has accelerated the adoption of fully electronic execution, and we expect this demand to continue.

We also believe that new clients, beyond our large bank customer base, will primarily transact electronically across our Fenics platforms.

The combination of wider adoption of hybrid and fully electronic execution and our competitive advantage in terms of technology and experience has contributed to our strong growth in electronically traded products.

We continue to invest in our

high-growth, high-margin, technology-driven businesses, including our standalone fully electronic Fenics Growth Platforms.

We continue to invest in our high-growth, high-margin, technology-driven businesses, including our standalone fully electronic Fenics Growth Platforms.

Fenics has exhibited strong growth over the past several years, and we believe that this growth has outpaced the wholesale brokerage industry.

We expect this trend to accelerate as we continue to convert more of our Voice/Hybrid execution into higher-margin, technology-driven execution across our Fenics platforms and grow our Fenics Growth Platforms.

We expect to benefit from the trend towards electronic trading, increased demand for market data, and the need for increased connectivity, automation, and post-trade services.

We continue to onboard new customers as the opportunities created by electronic and algorithmic trading continue to transform our industry.

We continue to roll out our next-gen Fenics execution platforms across more products and geographies with the goal of seamlessly integrating voice liquidity with customer electronic orders either by a GUI, API, or web-based interface.

We continue to roll out our next-gen Fenics execution platforms across more products and geographies with the goal of seamlessly integrating the liquidity of voice transactions with customer electronic orders either by a GUI, API, or web-based interface.

We expect to have continued success converting Voice/Hybrid desks over time as we roll out these platforms across more products and geographies.

Fenics Growth Platforms revenue grew 7.6% to $14.8 million in the fourth quarter of 2022.

Collectively, our newer Fenics Growth Platform offerings, such as those listed above, are not yet fully up to scale, but continue to grow at a leading rate.

Over time, we expect these new products and services to become profitable, high-margin businesses as their scale and revenues increase, all else equal.

We continue to invest in our Fenics Growth Platforms, which currently include:

• Fenics UST, one of the largest CLOB platforms for U.S.

Treasuries, had ADV growth of 65% during the fourth quarter of 2021, outpacing the overall market.

Fenics UST CLOB market share increased approximately 600 basis points from a year ago to over 20% in the fourth quarter, and represented 21% of the CLOB market in December 2021.

CLOB market share is from Greenwich Associates and BGC’s internal estimates.

From the third quarter onward, Greenwich Associates updated its methodology for calculating CLOB market share to more accurately reflect CLOB-only trading volumes.

Fenics UST is estimated to have saved our clients over $30 million in the fourth quarter and over $269 million from January 2019 through December 2021.

Fenics UST's revenue growth was driven by new product offerings, more traders using the platform and higher volumes.

Additionally, Fenics UST saw robust demand for its newer electronic T-bills offering, with a five-fold increase in ADV quarter-over-quarter, which represented as estimated 15% of the electronic U.S.

Treasury Bill market.

• Fenics GO, our global options electronic trading platform, provides live, real-time, and tradeable two-way electronic liquidity for exchange-listed futures and options, such as Eurex Euro Stoxx 50 Index Options, Euro Stoxx Banks Index Options, Nikkei 225 Index Options, Hang Seng Chinese Enterprise Index Options (HSCEI), DAX Index Options, and Korea Composite Stock Price Index Options (KOSPI).

Fenics GO electronic liquidity providers include Susquehanna International Securities (SIG), which joined DRW, Lighthouse, Citadel Securities, IMC, Maven Securities, Optiver and Akuna Capital as electronic liquidity providers.

Fenics GO has integrated Fenics' existing electronic platform MatchBox into its client offering.

MatchBox is an online platform that automates the trading, booking, and lifecycle management of global equity derivatives contracts.

The integration of these two electronic platforms provides Fenics GO's clients with a comprehensive electronic equity solution.

Fenics GO is the only anonymous multilateral electronic platform for block-sized listed equity index options, giving it a unique advantage in helping clients satisfy their best execution requirements.

Additionally, Fenics GO launched new MSCI index options products in January 2022, and expects to launch new cryptocurrency options later in the year.

Treasuries, saw CLOB market share increase by nearly 200 basis points during the fourth quarter on ADV of approximately $30 billion.

Fenics UST's streaming volume grew for the seventh consecutive quarter, with streaming ADV doubling compared to the fourth quarter a year ago.

Streaming earns significantly higher fee capture and represented over 40% of total volume in the fourth quarter, an all-time high.

• Lucera, our infrastructure and software business, offers the trading community direct connectivity to each other.

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LuceraConnect has quickly become the industry standard for the FX market and is rapidly expanding in other asset classes.

Lucera launched its cryptocurrency infrastructure business in the third quarter of 2021, offering clients access to cryptocurrency trading venues through LuceraConnect, leveraging its leading connectivity to exchanges, trading platforms, and custodians.

Additionally, LUMEMarkets provides an aggregated view of prices from multiple cryptocurrency venues.

Lucera’s cryptocurrency solution is focused on providing clients with world-class infrastructure that offers fully compliant workflows.

Lucera also supports the distribution of Fenics trading platforms, including Fenics UST, Fenics FX and Fenics MIDFX.

In the fourth quarter, Lucera onboarded new institutional and large bank clients, including in Lucera's cryptocurrency infrastructure business, which launched in the third quarter.

Winning new clients and expanding existing relationships adds to Lucera's highly recurring and compounding subscription revenue model.

Lucera is providing connectivity to the world's deepest crypto liquidity pools via its world-class infrastructure.

• Fenics' Credit offering, Portfolio Match, our recently deployed session-based, matching platform, currently supports U.S.

and European investment grade credit, as well as European high yield credit sessions.

• Fenics FX, our ultra-low latency electronic FX trading platform, generated strong double-digit volume and revenue growth during the quarter, outpacing FX ECN peers and the overall market.

• Our expanded Fenics FX platforms, which has businesses included under both Fenics Markets and Fenics Growth Platforms, including MIDFX, Spot FX and FX Options, and non deliverable forwards.

• Capitalab, which has businesses included under both Fenics Markets and Fenics Growth Platforms.

Revenue growth from Fenics Growth Platforms continued to significantly outpace the overall business.

Fenics Growth Platforms revenue grew 89.3% to $13.7 million in the fourth quarter of 2021 compared to the year prior and 60.2% to $45.5 million for the year ended December 31, 2021.

Collectively, our newer Fenics Growth Platform offerings, such as those listed above, are not yet fully up to scale, and are not yet generating significant revenues.

Over time, we expect these new products and services to become profitable, high-margin businesses as their scale and revenues increase, all else equal.

Fenics Markets highlights for the fourth quarter of 2021 include:

• Fenics MIDFX, our leading wholesale FX hedging platform, grew its revenue by 20% versus the prior year, driven by strong volumes across spot FX and Asian NDFs.

Fenics MID technology provides a highly efficient fully electronic platform for large global broker-dealers to hedge risk in a neutral environment.

• Fenics Market Data signed over 40 new contracts during the fourth quarter, with the total contracted value more than doubling compared to last year.

Fenics Market Data has seen continued success in its new Regulatory Services offering, with a robust pipeline leading into 2022.

Fenics Market Data which has a highly recurring and compounding subscription revenue model, continues to grow at a solid double-digit pace.

• Capitalab's NDF Match business, our advanced web-based matching platform that helps clients reduce foreign exchange exposure, more than doubled its ADV and revenue in the fourth quarter versus the prior year.

Fenics Markets revenue grew 13.7% to $87.7 million in the fourth quarter of 2021 compared to the year prior and 22.6% to $355.8 million for the year ended December 31, 2021.

Net Revenues in our Fenics businesses increased 20.2% to $101.4 million in the fourth quarter and 25.9% to $401.3 million for the year ended December 31, 2021 compared to the prior year period.

Fenics revenue comprised 23.0% and 21.8% of overall revenue, excluding Insurance brokerage, for the fourth quarter of 2021 and for the year ended December 31, 2021, respectively.

Lucera had another record quarter, generating strong double-digit revenue growth of 19% versus last year.

Lucera added new clients across both its LUMEMarkets platform and Compute hosting service and continues to grow its pipeline.

• Fenics GO, our global options electronic trading platform, saw strong volume growth across its Asian and European businesses.

HSCEI and KOSPI volumes were up over 470% and approximately 150% respectively, while Euro Stoxx 50 volumes were up over 400%.

Fenics GO's newer MSCI index options offerings ranked first across five of fifteen MSCI Asian indices at Eurex, the largest clearer of these products.

• Fenics FX, our ultra-low latency electronic FX trading platform, generated volume growth of 22%.

Fenics FX had another record quarter and has grown at a market leading rate throughout 2022.

• Portfolio Match, our credit matching platform, grew ADV over three-fold, capturing market share.

Portfolio Match was launched in 2021 and has become one of the fastest growing businesses across the Fenics ecosystem.

Fenics Markets revenue grew 7.4% to $94.1 million in the fourth quarter of 2022 compared to the prior year period.

Fenics Markets notable highlights for the fourth quarter of 2022 include:

• Fenics Market Data signed 48 new contracts during the fourth quarter and grew revenue 20% year-over-year.

With market leading client retention rates, Fenics Market Data continues to see strong demand for its Rates, FX, and Energy data packages.

• Fenics Direct, our web-delivered multi-dealer FX options platform, generated ADV growth of 22% in the quarter.

• Fenics MIDFX, our leading wholesale FX hedging platform, continued to see strong growth across its Asian NDF business with ADV improving by 83%.

Revenues in our Fenics businesses increased 7.4% to $108.9 million in the fourth quarter and 12.0% to $449.4 million for the year ended December 31, 2022 compared to the prior year period.

Within our Fenics businesses, Fenics Markets revenue grew 7.4% to $94.1 million, and Fenics Growth Platforms revenue increased 7.6% to $14.8 million.

Fenics Markets had a pre-tax margin of 30.6% in the fourth quarter of 2022.

Fenics has generated strong growth through the first 35 trading days of 2023 with revenue up 11% over the same period last year.

This strong electronic momentum has been driven by Rates, Credit, Foreign Exchange, Data and Software.

Fenics Markets revenue was up 10%.

This growth reflects the strength of our comprehensive Fenics offerings that provide access to the deepest wholesale liquidity pools using state-of-the-art technology.

Fenics Growth Platforms revenue was up 22%.

This growth has been led by our broad range of Fully Electronic platforms such as Fenics UST, Lucera, Fenics GO and Portfolio Match.

Total revenues from our high-margin data, software, and post-trade business, which is predominately comprised of recurring revenue, were up 3.8% to $25.1 million in the fourth quarter of 2022 and 7.1% to $96.4 million for the year ended December 31, 2022 over the prior year period.

Fenics brokerage revenues increased by 31.4% to $311.2 million for the year ended December 31, 2021.

Going forward, we expect Fenics to become an even more valuable part of BGC as it continues to grow.

Fenics brokerage revenues increased by 8.6% to $83.8 million in the fourth quarter of 2022 and 13.4% to $352.9 million for the year ended December 31, 2022 over the prior year period.

Fenics represented 25.0% of BGC's overall revenue in the fourth quarter and is expected to become an ever larger part of our overall business going forward.

We continue to analyze how to optimally configure our Voice/Hybrid and Fully Electronic businesses.

On November 3, 2021, we announced FMX, which combines Fenics UST’s leading cash U.S.

Treasury business with a state-of-the-art U.S.

Rates futures platform in development.

Following the announcement and consultation with our global clients and potential strategic partners, FMX has expanded the scope of its futures product offering to cover the entire U.S.

Rates Futures complex.

This includes launching U.S.

Treasury, Eurodollar, and SOFR futures contracts, concurrently, in the fourth quarter of 2022.

Cryptocurrency Initiatives

We continued to expand our cryptocurrency offerings during the quarter.

Lucera onboarded new clients to its cryptocurrency connectivity and trade aggregation software.

kACE, leveraging its award-winning Analytics, Pricing and Distribution software, onboarded new clients to its new cryptocurrency options offering.

Furthermore, we will be launching additional cryptocurrency and digital asset trading products throughout 2022, which will be underpinned by Fenics' state-of-the-art technology.

Our futures exchange was among the first exchanges to be permitted to list cryptocurrency derivative contracts.

We are uniquely positioned to capitalize on the significant and growing cryptocurrency opportunity.

Possible Corporate Conversion

The Company continues to explore a possible conversion into a simpler corporate structure.

Our board and committees have hired advisors and are reviewing the potential structure and details of such conversion.

Cost Reduction Program

The Company is continuing to examine how best to operate our business with the goal of creating efficiencies and reducing expenses.

During the first quarter of 2020, we implemented a $35.0 million cost reduction program to reduce our compensation-related cost base and streamline our operations, which resulted in $33.5 million of U.S.

GAAP compensation charges recorded under this program for the year ended December 31, 2020.

In addition, the Company incurred $32.1 million of U.S.

GAAP compensation charges in the year ended December 31, 2021, as a result of continuing to examine how best to operate our business and working to further streamline our operations.

GAAP items recorded include:

• Certain severance charges incurred in connection with headcount reductions as part of a broad cost reduction program;

• Certain compensation and non-compensation-related charges incurred as part of a broad cost reduction program.

GAAP items may include charges for exiting leases and/or other long-term contracts as part of cost-saving initiatives.

further, we continue to navigate the volatile interest rate environment experienced over the last year and the impact of high interest rates on our trading volumes and spreads.

FMX, our electronic U.S.

Treasury and Rates futures platform, is expected to complete all regulatory filings and submissions by the end of the first quarter.

We remain on track for a soft launch of our futures platform and we expect to announce its strategic investors prior to the launch.

The FMX partnership brings together LCH, the largest holder of interest rate collateral, strategic investors, representing the largest users of U.S.

interest rate products, and Fenics' industry-leading technology and distribution, creating enormous value for BGC as it competes in the world's most valuable futures markets.

Futures Exchange Group

The Futures Exchange Group acquisition has been determined to be a combination of entities under common control that resulted in a change in the reporting entity.

The assets and liabilities of the Futures Exchange Group have been recorded in the Company's Consolidated Statements of Financial Condition at the seller's historical carrying value.

The purchase of the Futures Exchange Group was accounted for as an equity transaction for the period ended September 30, 2021 (the period in which the transaction occurred).

Corporate Conversion

We expect to file a Form S-4 Registration Statement in connection with the Corporate Conversion in the second quarter of 2023.

We also expect to provide additional information with respect to our expected tax rates going forward as soon as practicable.

On November 15, 2022, BGC Partners, Inc.

and BGC Holdings, along with certain other affiliated entities, entered into a Corporate Conversion Agreement in order to reorganize and simplify BGC's organizational structure by converting from an Up-C to a “Full C-Corporation.” Upon completion of the Corporate Conversion Transactions, the stockholders of BGC Partners and the limited partners of BGC Holdings will participate in the economics of the BGC businesses through the same publicly traded corporate entity, BGC Group, Inc.

By simplifying the organizational structure, the Corporate Conversion Transactions are intended to improve transparency and reduce operational complexity.

The Corporate Conversion Agreement has been approved by BGC's Board of Directors, at the unanimous recommendation of the Joint Committee.

In the first quarter of 2023, BGC received preliminary approvals from various U.S.

and international regulatory authorities relating to the Corporate Conversion Transactions.

BGC continues to seek regulatory approvals where required.

Following receipt of such approvals, and subject to other customary closing conditions, including approval of BGC's shareholders, which are expected to be satisfied, the Company expects to close the Corporate Conversion in the third quarter of 2023.

Insurance Disposition

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The investment in the Insurance brokerage business generated an internal rate of return of 21.2% for our shareholders.

As of December 31, 2021, we have repurchased and redeemed 71.5 million shares and units since announcing the sale on May 26, 2021.

The sale of the business did not represent a strategic shift that would have a major effect on the Company’s operations and financial results and was, therefore, not classified as discontinued operations.

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For further information regarding the sale of our Insurance brokerage business, please see our Current Report on Form 8-K filed with the SEC on November 1, 2021, as well as Note 5—"Divestitures" to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.

The Insurance brokerage business contributed $19.9 million and $178.3 million in total revenues for the three and twelve months ended December 31, 2021, respectively.

No impairment charge was recorded for the sale of the Insurance brokerage business for the three and twelve months ended December 31, 2021 as the carrying amount of the net assets was less than the fair value less costs to sell.

Unvested equity and other awards previously granted by BGC to employees of its Insurance brokerage business were converted into the right to receive a cash payment from BGC;

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The payments after closing are only made if the applicable employee remains an employee of the Insurance brokerage business.

Other Matters

In February 2022, the U.S., U.K., EU, and other countries imposed sanctions on Russian counterparties, and as a result BGC has ceased trading with those clients.

The Company derived less than one percent of total revenue from its Moscow branch and sanctioned Russian counterparties.

During the year ended December 31, 2022, the Company has reserved $11.4 million in connection with unsettled trades and receivables with sanctioned Russian entities.

Financial Services Industry

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Most of these new securities and derivatives were not immediately ready for more liquid and standardized electronic markets, and generally increased the need for trading and required broker-assisted execution.

Due largely to the impacts of the global financial crisis of 2008-2009, our businesses faced more challenging market conditions from 2009 until the second half of 2016.

Due largely to the impacts of the global financial crisis of 2008-2009, our businesses had faced more challenging market conditions from 2009 until the second half of 2016.

Accommodative monetary policies were enacted by several major central banks, including the Federal Reserve, Bank of England, Bank of Japan and the European Central Bank, in response to the global financial crises.

These policies resulted in historically low levels of volatility and interest rates across many of the financial markets in which we operate.

The global credit markets also faced structural issues, such as increased bank capital

requirements under Basel III.

These policies resulted in historically low levels of volatility and interest rates across many of the

financial markets in which we operate.

The global credit markets also faced structural issues, such as increased bank capital requirements under Basel III.

Consequently, these factors contributed to lower trading volumes in our Rates and Credit asset classes across most geographies in which we operated.

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regulations, and higher overall corporate profitability.

The trend towards digitalization and electronification within the industry contributed to higher overall volumes and transaction count in fully electronic execution.

The trend towards digitization and electronification within the industry contributed to higher overall volumes and transaction count in fully electronic execution.

From the second quarter of 2020 onward, concerns about the future trade relationship between the U.K.

and the EU after Brexit, a slowdown in global growth driven by the outbreak of COVID-19, inflation expectation impact on U.S.

rates volumes, and an increase in trade protectionism were tempered by monetary and fiscal stimulus.

In addition, during 2021, as the global economy recovered from the COVID-19 pandemic, higher inflation across the U.S.

and other G8 countries led central banks to begin and/or announce tapering of asset purchases under quantitative easing programs, as well as drive market expectations of future central bank rate hikes.

Impact of COVID-19

In recent years, we have been adversely affected as a result of COVID-19 and its impact on the macroeconomic environment.

For example, surges in global COVID-19 cases caused market-wide disruptions, particularly across our Voice/Hybrid business in December 2021.

During the COVID-19 pandemic, our fully electronic businesses have been a key growth driver and competitive advantage as many of our brokers and clients have adapted to working remotely.

Additional information with respect to the impact of COVID-19 on our businesses, results of operations and human capital resources is contained elsewhere in this Annual Report on Form 10-K.

Impact of COVID-19 on Employees

As a global intermediary to financial markets, BGC is considered an essential business in many of its various global locations where key employees are thus able to operate out of its primary offices around the world.

We have nonetheless taken proactive measures intended to protect our employees and clients during this global pandemic.

These policies and practices seek to protect the health, safety and welfare of our workforce while enabling employees to maintain a high level of performance.

Certain of these items are summarized below:

• We activated our Business Continuity Plan in the first quarter of 2020.

The vast majority of front-office personnel are working in a firm office and most BGC staff members are attending work in the office several days a week, while working remotely the other part of the week.

We follow all applicable laws and regulations to ensure both compliance with the COVID-19 requirements and the safety of our employees.

• We provide ongoing informational COVID-19-related messages and notices.

We disseminated our COVID-19 policies and FAQs on a regular basis;

they are also posted on the Company's intranet sites.

• Where applicable, we are applying more frequent and vigorous cleaning and sanitation measures and providing personal protective equipment (PPE).

• Internal and external meetings are sometimes held in person, as well as conducted virtually and via phone calls.

• We have deferred some corporate events and participation in industry conferences.

• Our medical plans have waived applicable member cost sharing for all medically necessary diagnostic testing related to COVID-19.

• We have reminded employees about our Employee Assistance Program and the ways it can assist them during this challenging time.

• We provide paid leave in accordance with its policies and applicable COVID-19-related laws and regulations.

We continue to take significant steps to protect our employees and encourage them all to get vaccinated.

Impact of COVID-19 on the Company’s Results

Voice/Hybrid and/or Higher-Margin, Technology-Driven Fenics Businesses

We recorded total revenue of $2,015.4 million for the year ended December 31, 2021, 2.0% lower than a year ago.

For the year ended December 31, 2021, Fenics net revenues of $401.3 million, increased 25.9% driven by a $65.5 million, or 22.6%, increase in Fenics Markets and a $17.1 million, or 60.2%, increase in Fenics Growth Platforms.

Certain key items are summarized below:

• Revenues across Rates, Credit, FX, Equity derivatives and cash equities, Energy and commodities are generally correlated with corresponding industry volumes.

• Rates benefited from strong growth across BGC's U.S.

government bonds, inflation products, listed rates, and emerging market rates.

• Energy & Commodities generated revenue growth, driven by strong performance in BGC's environmental brokerage business and heightened volatility across the energy markets.

• Concerns around U.S.

inflation and the ease of asset purchases in the fourth quarter by the Federal Reserve, drove interest rate volatility higher and supported global Rates trading volumes.

• Conversely, quantitative easing measures taken by central banks around the world have lowered market volumes.

• Uncertainty around global energy supplies led to large price rallies and volatility in these products, which increased secondary market trading volumes.

We expect record levels of global debt issuance, interest rate volatility, tapering of central bank asset purchases, and an improving U.S.

and global economy to provide tailwinds to our Rates business going forward.

Overall Fenics

• BGC’s Fenics net revenues increased 25.9% for the year ended December 31, 2021 compared to the prior year.

• Fenics has benefited and is expected to continue to benefit from trends towards electronic execution and opportunities created by algorithmic trading and automation.

• The dislocations caused by COVID-19 have resulted in an even greater demand for the Company’s electronic execution.

We believe that the driver of this demand is the best-in-class market liquidity that only integrated global firms like BGC can provide.

• This benefit may be tempered by temporary shifts by traders toward voice execution in certain markets during periods of extreme market turbulence.

• BGC’s data, software, and post-trade businesses are predominantly comprised of recurring revenues.

BGC’s compensation expenses increased for the year ended December 31, 2021, due to the sale of the Insurance brokerage business, which included one-off compensation charges and sale-related expenses totaling $168.6 million, the majority of which was non-cash.

BGC’s non-compensation expenses decreased due to lower interest expense, professional and consulting fees, and other expenses.

These expense reductions were partially offset by higher selling and promotion charges, as COVID-19 restrictions have relaxed across many of the major geographies in which BGC operates.

BGC has recorded or may potentially record amounts for certain expenses that are higher than they otherwise would have been due to the overall impact of the pandemic.

Some of these items include:

• Non-cash impairment charges with respect to assets;

• Non-cash mark-to-market adjustments for non-marketable investments;

• Certain severance charges incurred in connection with headcount reductions as part of a broad cost reduction program;

• Certain compensation and non-compensation-related charges incurred as part of a broad cost reduction program.

GAAP items may include charges for exiting leases and/or other long-term contracts as part of cost-saving initiatives;

• Expenses relating to setting up and maintaining remote and/or back-up locations;

• Communication expenses related to additional voice and data connections.

Some of the above items may be partially offset by certain tax benefits.

It is difficult to predict the amounts of any these items or when they might be recorded because they may depend on the duration, severity, and overall impact of the pandemic.

Capital and Liquidity

On February 15, 2022, our Board declared a $0.01 dividend for the fourth quarter of 2021.

Additionally, BGC Holdings continues to have reduced distributions to or on behalf of its partners.

The distributions to or on behalf of partners will at least cover their related tax payments.

Whether any given post-tax amount is equivalent to the amount received by a stockholder also on an after-tax basis depends upon stockholders’ and partners’ domiciles and tax status.

Our 2022 capital allocation priorities are to return capital to stockholders and to continue investing in our high growth Fenics businesses.

Previously, we were deeply dividend-centric;

going forward, we plan to prioritize share and unit repurchases over dividends and distributions.

The Board will reevaluate whether to increase the dividend in the first quarter of 2022.

For further information on the balance sheet, liquidity and capital, see "Liquidity and Capital Resources" herein.

and the EU after Brexit, a slowdown in global growth driven by the outbreak of COVID-19, and an increase in trade protectionism were tempered by monetary and fiscal stimulus.

During 2021, as the global economy recovered from the COVID-19 pandemic, higher inflation across the U.S.

and other G8 countries led many central banks to begin and/or announce tapering and unwinding of asset purchases under quantitative easing programs, as well as implement multiple interest rate hikes.

This recent change in central bank monetary policies away from zero interest rates, following the highest inflation in decades, together with rising interest rates and the strengthening of the U.S.

dollar, has set the stage for a resurgence in secondary market trading volumes for rates, credit and foreign exchange.

For more than fourteen years, BGC and the entire financial service industry's trading volumes have been constrained by low interest rates and quantitative easing.

Throughout 2023, the Company expects sustained levels of increased secondary market trading volumes in Rates, Credit and Foreign Exchange, where BGC is a market leader.

In December of 2022, our brokerage revenue grew 7%.

The momentum has continued into 2023 with revenue up 8% for the first 35 trading days of the first quarter of 2023.

This growth is consistent with our previously reported expectation for strong growth to return in 2023.

We have seen revenue growth across all of our asset classes with Rates, Foreign Exchange and Credit increasing by 6%, 6% and 4%, respectively.

Additionally, Energy and Commodities has increased by 15% and Equities is up by 14%.

Manufactured zero and near-zero interest rates over the last fourteen years has caused the break down and disappearance of the historic correlation between issuance and trading volume growth.

With meaningful interest rates and issuance that is multiples above 2008 levels, we believe the return of this strong positive correlation will drive our trading volumes significantly higher.

This has set the stage for broad-based growth across BGC's businesses and asset classes.

We expect continued growth throughout 2023 and for the foreseeable future.

On January 1, 2021, the U.K.

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Financial services fall outside of the scope of this trade agreement.

Instead, the relationship will largely be determined by a series of “equivalence decisions,” each of which would grant mutual market access for a limited subset of financial services where either party finds the other party has a regulatory regime that achieves similar outcomes to its own.

It is currently unknown if or when equivalence decisions will be taken.

At the time the relationship was expected to be determined by a series of “equivalence decisions,” each of which would grant mutual market access for a limited subset of financial services where either party finds the other party has a regulatory regime that achieves similar outcomes to its own.

In March 2021, the U.K.

and EU agreed a Memorandum of Understanding on Financial Services Regulatory Cooperation which creates a structure for dialogue but does not include commitments on equivalence.

In light of ongoing uncertainties, market participants are still adjusting.

The exact impact of Brexit on the U.K.-EU flow of financial services therefore remains unknown.

This same uncertainty applies to the consequences for the economies of the U.K.

and the EU member states as a result of the U.K.’s withdrawal from the EU.

In light of ongoing uncertainties, market participants are still adjusting the way in which they conduct business between the U.K.

The impact of Brexit on the U.K.-EU flow of financial services and economies of the U.K.

and the EU member states continues to evolve.

We implemented plans to ensure continuity of service in Europe and continue to have regulated offices in place in many of the major European markets.

As part of our Brexit strategy, ownership of BGC Madrid, Copenhagen and Frankfurt & GFI Paris, Madrid and Dublin branches was transferred to Aurel BGC SAS (a French-based operation and therefore based in the EU) in July 2020.

As part of our ongoing Brexit strategy, ownership of BGC Madrid, Copenhagen and Frankfurt & GFI Paris, Madrid and Dublin branches was transferred to Aurel BGC SAS (a French-based operation and therefore based in the EU) in July 2020.

We have been generally increasing our footprint in the EU which includes the establishment of a new branch office of Aurel BGC SAS in Milan and a new office in Monaco under a new local Monaco subsidiary.

Regardless of these and other mitigating measures, our European headquarters and largest operations are in London, and market access risks and uncertainties have had and could continue to have a material adverse effect on our customers, counterparties, businesses, prospects, financial condition and results of operations.

Regardless of these and other mitigating measures, our European headquarters and largest operations are in London, and market access risks and uncertainties have had and could continue to have a material adverse effect on our customers, counterparties, business, prospects, financial condition and results of operations.

Furthermore, in the future the U.K.

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Industry Consolidation

In recent years, there has been significant consolidation among the interdealer-brokers and wholesale brokers with which we compete.

Over the past decade, there has been significant consolidation among the interdealer-brokers and wholesale brokers with which we compete.

We expect to continue to compete with the electronic markets, post-trade and information businesses of NEX, that are part of CME now, through the various offerings on our Fenics platform.

We will also continue to compete with TP ICAP and Tradition across various Voice/Hybrid brokerage marketplaces as well as via Fenics.

Additionally, there has been an increase in acquisitions of OTC trading platforms by exchanges and electronic marketplaces such as ICE buying BondPoint, Deutsche Börse buying 360T, and CBOE buying Hotspot, MarketAxess buying LiquidityEdge, Tradeweb buying Nasdaq U.S.

Fixed Income Electronic Trading Platform, etc.

Additionally, there has been an increase in acquisitions of OTC trading platforms by exchanges and electronic marketplaces such as ICE buying BondPoint and TMC Bonds, Deutsche Börse buying 360T, and CBOE buying Hotspot, MarketAxess buying LiquidityEdge, Tradeweb buying Nasdaq U.S.

Fixed Income Electronic Trading Platform, LSEG acquiring Quantile, etc.

We view the recent consolidation in the industry favorably, as we expect it to provide additional operating leverage to our businesses in the future.

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Rates volumes in particular are influenced by market volumes and, in certain instances, volatility.

Historically low and negative interest rates across the globe have significantly reduced the overall trading appetite for rates products.

As a result of central bank policies and actions, many sovereign bonds continue to trade at or close to negative yields, especially in real terms.

Also, weighing on yields and rates volumes are global central bank quantitative easing programs.

The programs depress rates volumes because they entail central banks buying government securities or other securities in the open market in an effort to promote increased lending and liquidity and bring down long-term interest rates.

Historically low and negative interest rates, as well as central bank quantitative easing programs, across the globe significantly reduced the overall trading appetite for rates products.

Such programs have depressed rates volumes because they entail central banks buying government securities or other securities in the open market in an effort to promote increased lending and liquidity and bring down long-term interest rates.

When central banks hold these instruments, they tend not to trade or hedge, thus lowering rates volumes across cash and derivatives markets industry-wide.

Following the market dislocation and ongoing pandemic, major central banks such as the U.S.

Federal Reserve, ECB, Bank of Japan, Bank of England, and Swiss National Bank restarted quantitative easing programs in 2020, and continue to maintain historically low interest rates, keep key short-term interest rates low, or a combination of both.

Recent heightened levels of inflation in 2020, meant major central banks have begun and/or expect to begin tapering asset purchases and plan to hike interest rates, which historically has led to an increase in rates volumes.

Federal Reserve, ECB, Bank of Japan, Bank of England, and Swiss National Bank restarted quantitative easing programs in 2020.

However, inflationary concerns have resulted in rising interest rates and tapering and/or unwinding of central bank asset purchases.

Management continues to expect a robust macro trading environment in 2023, leading to broad-based growth in most products BGC brokers.

This improved backdrop is expected to support both BGC's Fenics and Voice / Hybrid businesses for the foreseeable future.

Additional factors have weighed on market volumes in the products we broker.

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We believe that this has further reduced overall market exposure and industry volumes in many of the products we broker, particularly in Credit.

For the year ended December 31, 2021, industry volumes were higher year-over-year across Rates and Energy and Commodities, mixed across Equity derivatives and cash equities and generally lower across FX and Credit.

For the year ended December 31, 2022, industry volumes were higher year-over-year across short-term Rates, Foreign Exchange, and Equities, particularly equity derivatives.

Secondary trading volumes were mixed across Credit and generally lower across medium- and long-term Rates.

Energy and Commodities volumes were generally down due to ongoing challenges in oil and UK and European power markets.

BGC’s brokerage revenues, excluding Insurance, were down by 2.6% year-on-year.

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Rates Volumes and Volatility

Our Rates business is influenced by a number of factors, including global sovereign issuances, secondary trading and the hedging of these sovereign debt instruments.

The amount of global sovereign debt outstanding remains at very high levels;

the level of secondary trading and related hedging activity was higher during 2021, as the prior year was severely impacted by the COVID-19 pandemic, which led to the dislocations of traders and lower risk appetites.

In addition, according to SIFMA and the Federal Reserve Bank of New York, the average daily volume of various U.S.

Treasuries and Treasury bills, among primary dealers was 3% higher in 2021 as compared to a year earlier.

Additionally, interest rate derivative volumes were up 13% and 15% at ICE and the CME, respectively, all according to company press releases.

In comparison, our revenue from Fenics Rates increased 43.7%, while our overall Rates revenues were up 2.6% as compared to a year earlier to $558.5 million.

Our Rates business is influenced by a number of factors, including global sovereign issuances, interest rate, central bank policies, secondary trading and the hedging of these sovereign debt instruments.

The amount of global sovereign debt outstanding remains at historically high levels;

the level of secondary trading and related hedging activity was mixed during 2022, compared to the prior year period.

According to Bloomberg and the Federal Reserve Bank of New York, the average daily volume of U.S.

Treasuries with maturities less than three years was up 14%, while volumes for maturities six years and greater decreased by 11%.

IRS volumes traded on SEF were down 39% compared to 2021, according to Clarus.

In comparison, our overall Rates revenues were down 1.6% as compared to a year earlier to $549.5 million.

Our Rates revenues, like the revenues for most of our products, are not fully dependent on market volumes and, therefore, do not always fluctuate consistently with industry metrics.

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Additionally, yields on benchmark U.S.

Treasuries exhibited volatility during the fourth quarter of 2021 on inflation concerns and central bank tapering plans.

While most economists expect that the effects of various forms of quantitative easing being undertaken by the various major central banks will continue to negatively impact financial market volumes, the tapering of asset purchases by central banks, interest rate hikes, along with elevated levels of government debt issuance, are expected to provide tailwinds to our Rates business.

Treasuries exhibited volatility during the fourth quarter of 2022 on rising interest rates, inflation concerns and quantitative tightening by central banks.

The tapering and/or unwinding of asset purchases by central banks, interest rate hikes, along with elevated levels of government debt issuance, are expected to provide tailwinds to our Rates business.

FX Volumes and Volatility

Global FX volumes were generally lower during 2021.

Volumes for CME FX futures and options and CME EBS spot FX were down 7%, and 14%, respectively.

Global FX volumes were higher during 2022.

Volumes for CME FX futures and options and CME EBS spot FX were up 24%, and 7%, respectively, and Refinitiv was up 2%.

In comparison, revenue from our Fenics FX platforms increased 39%, while our overall FX revenues decreased by 0.5% to $299.7 million.

Insurance Brokerage

The overall Insurance brokerage business, which we sold to The Ardonagh Group on November 1, 2021, included Ed Broking and Besso, as well as our aviation and space insurance brokerage business, Piiq.

The pre-tax loss relating to Insurance was $53.9 million and $25.6 million for the years ended December 31, 2021 and 2020, respectively.

Insurance posted total revenues of $19.9 million and $178.3 million, respectively, for both the fourth quarter and full year 2021.

Equity derivatives and cash equities

Global equity volumes were higher during 2021.

Research from Raymond James indicated that the average daily volumes of U.S.

Equities Volumes

Global equity volumes were generally higher during 2022.

According to SIFMA and the OCC, the average daily volumes of U.S.

cash equities and U.S.

options were up 4% and 33%, respectively, as compared to a year earlier, while average daily volume of European cash equities shares were down 6% (in notional value).

Over the same timeframe, Eurex average daily volumes of equity derivatives were up 10%, while Euronext equity derivative index volumes decreased by 10%.

BGC’s equity business primarily consists of equity derivatives.

Our overall revenues from Equity derivatives and cash equities decreased by 2.8% to $247.7 million.

options were up 4% and 15%, respectively, as compared to a year earlier.

Over the same timeframe, Eurex average daily volumes of equity derivatives were up 12%, while Euronext equity derivative index volumes were up 19%.

BGC’s equity business primarily consists of equity derivatives, particularly European equity derivatives.

Our overall revenues from Equities decreased by 5.3% to $234.5 million.

Credit Volumes

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In addition, many of our large bank customers continue to reduce their inventory of bonds and other credit products in order to comply with Basel III and other international financial regulations.

During 2021, primary dealer average daily volume for corporate bonds (excluding commercial paper) was down by 10% according to Bloomberg and the Federal Reserve Bank of New York.

Total notional traded credit derivatives as reported by the International Swaps and Derivatives Association — a reflection of the OTC derivatives market — were down by 2%, from a year earlier.

Credit volumes were mixed during 2022.

Primary dealer average daily volume for U.S.

Investment Grade was up 8% and U.S.

High Yield was down by 6% according to Bloomberg and the Federal Reserve Bank of New York.

In comparison, our overall Credit revenues decreased by 5.6% to $271.4 million.

Energy and Commodities

Energy and commodities volumes were generally higher during 2021 compared with the year earlier.

CME and ICE energy futures and options volumes were up 16% and 7%, respectively, driven by heightened volatility across the energy markets.

In comparison, BGC’s energy and commodities revenues increased by 1.3% to $296.5 million.

Energy and Commodities Volumes

Energy and commodities volumes were generally down during 2022 compared with the year earlier.

CME and ICE energy futures and options volumes were down 7% and 3%, respectively, as higher prices and volatility weighed on certain energy products.

In comparison, BGC’s energy and commodities revenues decreased by 1.6% to $291.7 million.

FINANCIAL OVERVIEW

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We offer our brokerage services in five broad product categories:

Rates, FX, Credit, Energy & commodities, Equity derivatives and cash equities classes.

We previously offered Insurance brokerage services, however, we sold our Insurance brokerage business to The Ardonagh Group on November 1, 2021.

Rates, FX, Credit, Energy and commodities, and Equities classes.

We previously offered Insurance brokerage services;

however, we sold our Insurance brokerage business to The Ardonagh Group on November 1, 2021.

The chart below details brokerage revenues by product category and by Voice/Hybrid versus Fully Electronic (in thousands):

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Credit 271,419 287,608 329,904

Equity derivatives and cash equities 247,673 254,702 251,339

Equities 234,493 247,673 254,702

Insurance — 178,087 182,707

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Credit 16.5 15.4 17.2

Equity derivatives and cash equities 13.2 13.3 12.8

Equities 14.2 13.2 13.3

Insurance — 9.5 9.6

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We sold our Insurance brokerage business on November 1, 2021 (see Note 5—"Divestitures" to our consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for additional information).

Equity Derivatives and Cash Equities

We provide brokerage services in a range of markets for equity products, including cash equities, equity derivatives (both listed and OTC), equity index futures and options on equity products.

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The software solutions business leverages our global infrastructure, software, systems, portfolio of intellectual property, and electronic trading expertise to provide customers with electronic marketplaces and exchanges and real-time auctions to enhance debt issuance and to customize trading interfaces.

We take advantage of the scalability, flexibility and functionality of our electronic trading system to enable our customers to distribute products to their customers through online offerings and auctions, including private and reverse auctions, via our trading platform and global network.

platform and global network.

Using screen-based market solutions, customers are able to develop a marketplace, trade with their customers, issue debt, trade odd lots, access program trading interfaces and access our network and intellectual property.

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Through the Swaptioniser service for portfolio compression of Bilateral and Cleared Interest Rate Swaptions, Interest Rate Swaps, Caps and Floors and FX Products, Capitalab looks to simplify the complexities of managing large quantities of derivatives, to help promote sustainable growth, lower systemic risk and improve resiliency in the industry.

Furthermore, as an approved compression services provider at LCH, a combined

multiproduct Rates solution is provided across the entire cleared and non-cleared portfolio, increasing the overall efficiency, where delta offsets can be leveraged across Rates products and desks.

Furthermore, as an approved compression services provider at LCH, a combined multiproduct Rates solution is provided across the entire cleared and non-cleared portfolio, increasing the overall efficiency, where delta offsets can be leveraged across Rates products and desks.

Additionally, Capitalab’s Initial Margin Optimization service allows participants to reduce their bilateral initial margin and CCP IM with the efficiency of automated trade processing.

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Preferred Units may not be made exchangeable into our Class A common stock and are only entitled to the Preferred Distribution, and accordingly they are not included in our fully diluted share count.

The quarterly allocations of net income on Preferred Units are reflected in compensation expense under “Equity-based

compensation and allocations of net income to limited partnership units and FPUs” in our consolidated statements of operations.

The quarterly allocations of net income on Preferred Units are reflected in compensation expense under “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in our consolidated statements of operations.

In addition, as part of our compensation plan, certain employees are granted RSUs.

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The costs associated with such plans are generally amortized over the period in which they vest.

See Note 19—“Compensation” to our consolidated financial statements.

See Note 18—“Compensation” to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K for more information.

Other Operating Expenses

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Gain (Loss) on Divestiture and Sale of Investments

Gain (Loss) on divestiture and sale of investments represent the gain or loss we recognize for the divestiture or sale of our investments.

Gain (loss) on divestiture and sale of investments represents the gain or loss we recognize for the divestiture or sale of our investments.

Gains (Losses) on Equity Method Investments

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partnerships and are subject to the UBT in New York City.

federal and state income tax liability or benefit related to the partnership income or loss, with the exception of UBT, rests with the partners (see Note 2—“Limited Partnership Interests in BGC Holdings and Newmark Holdings” for discussion of partnership interests), rather than the partnership entity.

The Company’s consolidated financial statements include

federal and state income tax liability or benefit related to the partnership income or loss, with the exception of UBT, rests with the partners (see Note 2—“Limited Partnership Interests in BGC Holdings and Newmark Holdings” in Part II, Item 8 of this Annual Report on Form 10-K for discussion of partnership interests), rather than the partnership entity.

The Company’s consolidated financial statements include U.S.

federal, state and local income taxes on the Company’s allocable share of the U.S.

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Our average revenue per front-office employee has historically declined year-over-year for the period immediately following significant headcount increases, and the additional brokers and salespeople generally achieve significantly higher productivity levels in their second or third year with the Company.

Excluding Insurance brokerage, as of December 31, 2021, our front-office headcount was approximately 2,100 brokers, salespeople, managers, technology professionals and other front-office personnel, down 8.1% from 2,297 a year ago.

Compared to the prior year, average revenue per front-office employee for the year ended December 31, 2021 increased by 8.1% to $811 thousand from $750 thousand.

As of December 31, 2022, our front-office headcount was 1,985 brokers, salespeople, managers, technology professionals and other front-office personnel, down 6.0% from 2,100 a year ago.

Compared to the prior year, average revenue per front-office employee for the year ended December 31, 2022 increased by 6.1% to $861 thousand from $811 thousand compared to the prior period.

The laws and regulations passed or proposed on both sides of the Atlantic concerning OTC trading seem likely to favor increased use of technology by all market participants, and are likely to accelerate the adoption of both Hybrid and Fully Electronic execution.

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We believe this will lead to further consolidation across the wholesale financial brokerage industry, and thus allow us to grow profitably.

Since 2019, our acquisitions have included Ed Broking, Ginga Petroleum, Algomi and the Futures Exchange Group.

Since 2020, our acquisitions have included Algomi and the Futures Exchange Group.

On July 30, 2021, we completed the purchase of the Futures Exchange Group from Cantor, which represents our futures exchange and related clearinghouse.

On March 6, 2020, we completed the acquisition of Algomi, a software company operating under a SaaS model that provides technology to bond market participants to improve their workflow and liquidity by data aggregation, pre-trade information analysis and execution facilitation.

On March 12, 2019, we completed the acquisition of Ginga Petroleum.

Ginga Petroleum provides a comprehensive range of broking services for physical and derivative energy products, including naphtha, liquefied petroleum gas, fuel oil, biofuels, middle distillates, petrochemicals and gasoline.

On January 31, 2019, we completed the acquisition of Ed Broking, an independent Lloyd's of London insurance broker with a strong reputation across accident and health, aerospace, cargo, energy, financial and political risks, marine, professional and executive risks, property and casualty, specialty and reinsurance.

Ed Broking became part of the overall Insurance brokerage business and was subsequently sold to The Ardonagh Group on November 1, 2021 as part of the Insurance Business Disposition.

FINANCIAL HIGHLIGHTS

For the year ended December 31, 2021, income from operations before income taxes increased by $104.3 million, or 144.4%, to $176.5 million compared to the prior year period, primarily due to a $312.9 million gain on the sale of the Insurance brokerage business in the fourth quarter of 2021.

Total revenues for the year ended December 31, 2021 decreased

$41.4 million, or 2.0%, to $2,015.4 million compared to the prior year period.

The first quarter of 2020 was unique in that it reflected record market volatility and volumes driven by the onset of the COVID-19 pandemic.

We continued to make excellent progress this year with respect to our investments in Fenics.

Our Fenics growth accelerated during the year ended December 31, 2021, with revenues increasing by 25.9%, to $401.3 million and represented a record 21.8% of our total revenues, excluding the Insurance brokerage business, increasing from 17.0% for the year ended December 31, 2020.

The growth in our Fenics platforms continued to significantly outpace the overall business as we added new clients and expanded our product offerings.

As we continue to grow our higher margin businesses, we are well positioned for increased profitability.

Brokerage revenues for the year ended December 31, 2021 decreased by $49.6 million, or 2.6%, to $1,869.7 million compared to the prior year period, which was primarily driven by Credit revenues, which decreased by $42.3 million, to $287.6 million, for the year ended December 31, 2021, due to significantly lower industry-wide trading volumes.

For the year ended December 31, 2021, our FX revenues decreased $13.9 million, to $301.3 million, and revenues from Equity derivatives and cash equities decreased by $7.0 million, to $247.7 million.

The Insurance brokerage business revenues decreased by $4.6 million, or 2.5%, to $178.1 million, for the year ended December 31, 2021, primarily due to the sale of the Insurance brokerage business during the fourth quarter of 2021.

Rates revenues increased by $14.4 million, to $558.5 million, for the year ended December 31, 2021 as compared to the prior year period, driven by favorable trading environment across many of the Rates products BGC brokers, and revenues from Energy and commodities increased by $3.8 million, to $296.5 million for the year ended December 31, 2021, led by BGC's leading environmental brokerage business and heightened volatility across the energy complex.

Revenues in our Fenics business increased 25.9% to $401.3 million for the year ended December 31, 2021, compared to the prior year period, driven by strong growth across both Fenics Markets and Fenics Growth Platforms.

Beginning in the first quarter of 2021, BGC categorized its Fenics businesses as Fenics Markets and Fenics Growth Platforms.

Fenics Markets includes the Fully Electronic portions of BGC’s brokerage businesses, data, software and post-trade revenues that are unrelated to Fenics Growth Platforms, as well as Fenics Integrated revenues.

Fenics Growth Platforms includes Fenics UST, Fenics GO, Lucera, Fenics FX and other newer standalone platforms.

Revenues generated from data, software and post-trade attributable to Fenics Growth Platforms are included within their related businesses.

Fenics Markets and Fenics Growth Platforms compete with companies such as CME, Tradeweb and MarketAxess.

Fenics Markets revenues comprised $355.8 million, an improvement of $65.5 million, or 22.6%, which reflected higher conversion of Voice and Hybrid execution to Fenics brokerage, increased contribution from Fenics Integrated, and strong growth across Rates, FX and Market Data.

Fenics Growth Platforms revenues comprised $45.5 million, an increase of $17.1 million, or 60.2%, driven by strong growth in Fenics UST, Lucera and Fenics GO.

During the second quarter of 2020, we introduced Fenics Integrated, which seamlessly integrates hybrid liquidity with customer electronic orders.

We believe that Fenics Integrated will enhance profit margins by further incentivizing the Company’s brokers and clients to automate execution.

We believe that Fenics Integrated will create superior real-time information, improving the robustness and value of Fenics Market Data, which will accelerate our growth.

As we expand our product offerings, optimize our commercial agreements, and add new clients across our electronic platforms, we continue to expect profitability in our newer Fenics Growth Platforms, which includes Fenics UST, Fenics GO, Lucera, Fenics FX and other newer standalone platforms.

During the quarter we announced FMX, which combines Fenics UST's leading U.S.

Treasury business with a state-of-the-art U.S.

Rates futures platform in development.

Following the announcement and consultation with our global clients and strategic partners, FMX will expand the scope of its futures product offering to cover the entire U.S.

Rates Futures complex.

This includes launching U.S.

Treasury, Eurodollar, and SOFR futures contracts, concurrently, in the fourth quarter of 2022.

Total expenses for the year ended December 31, 2021 increased by $186.7 million to $2,178.2 million compared to the prior year period, primarily driven by a $211.4 million increase in total compensation expenses.

Within total compensation, our Equity-based compensation and allocations of net income to limited partnership units and FPUs increased by $72.6 million due to an increase in charges related to grants of exchangeability and issuance of shares of BGC Class A common stock, while expenses for Compensation and employee benefits increased by $138.8 million, primarily due to the sale of the Insurance brokerage business, which included one-off compensation charges and sale related expenses totaling $168.6 million, the majority of which was non-cash, partially offset by the impact of lower commission revenues on variable compensation.

Our non-compensation expenses decreased by $24.7 million, or 3.7%, primarily driven by a continued focus on tighter cost management as well as the impact of COVID-19, including lower occupancy and equipment expenses and reduced professional and consulting fees.

There was also a decrease in other expenses related to a decrease in amortization expense on intangible assets, a decrease in other provisions, and a decrease in expenses due to the sale of the Insurance brokerage business, partially offset by an increase in legal settlement and litigation costs, as well as an increase related to Charity Day contributions.

Further, there was a decrease in interest expense related to the 5.125% Senior Notes, which were repaid in May 2021, lower interest expense related to the borrowings on the Revolving Credit Agreement, partially offset by interest expense related to the 4.375% Senior Notes issued in July 2020.

Total other income (losses), net for the year ended December 31, 2021 increased $332.4 million to $339.4 million compared to the prior year period, primarily due to a $312.9 million gain on the sale of the Insurance brokerage business in the fourth quarter of 2021, an increase related to mark-to-market movements on other assets, a gain recognized on a litigation

resolution in the first quarter of 2021, an increase due to an impairment of an equity-method investment recorded in the first quarter of 2020 compared to no impairment recorded in the year ended December 31, 2021, an increase in other recoveries related to a settlement recognized in the fourth quarter of 2021, an increase related to gains on equity method investments, and an increase related to fair value adjustments on investments held recorded in the year ended December 31, 2020, partially offset by a decrease related to COVID-19 recoveries in the year ended December 31, 2020.

On February 15, 2022, our Board declared a 0.01 dividend for the fourth quarter.

Effective with the first quarter of 2020 dividend, and for all quarterly periods in 2020 and 2021, the Board reduced the quarterly dividend out of an abundance of caution in order to strengthen the Company’s balance sheet as the global capital markets faced difficult and unprecedented macroeconomic conditions related to the global pandemic.

Additionally, BGC Holdings continues to have reduced distributions to or on behalf of its partners.

The distributions to or on behalf of partners will at least cover their related tax payments.

Whether any given post-tax amount is equivalent to the amount received by a stockholder also on an after-tax basis depends upon stockholders’ and partners’ domiciles and tax status.

BGC believes that these steps will allow the Company to prioritize its financial strength.

Our 2022 capital allocation priorities are to use the remaining proceeds from the Insurance Business Disposition and other sources of liquidity to return capital to stockholders and to continue investing in its high growth Fenics businesses.

We plan to prioritize share and unit repurchases over dividends and distributions.

Full year 2022 compared to full year 2021:

Income from operations before income taxes was $97.5 million compared to $176.5 million in the prior year period.

Total revenues decreased $220.1 million, or 10.9%, to $1,795.3 million.

This decrease was largely as a result of the sale of the Insurance brokerage business during the fourth quarter of 2021, which generated $178.3 million in revenues in the prior year period.

Brokerage revenues, excluding the Insurance brokerage business, decreased $44.8 million, or 2.6%, to $1,646.8 million, which was driven by a decrease across all products.

Total expenses decreased $461.1 million, or 21.2%, to $1,717.1 million compared to the prior year period, primarily due to a $423.3 million decrease in total compensation expenses, primarily driven by the sale of the Insurance business during the fourth quarter of 2021, which included one-off compensation charges and sale-related expenses totaling $168.6 million.

The $37.8 million decrease in non-compensation expenses was primarily driven by lower occupancy and equipment expense primarily due to the sale of the Insurance brokerage business, lower interest expense due to the repayment in full of the 5.125% Senior Notes on May 27, 2021, as well as lower communications expense, and lower commissions and floor brokerage expense which was primarily due to lower revenues.

These expense reductions were partially offset by higher selling and promotion charges, as COVID-19 restrictions have relaxed across many of the major geographies in which we operate, as well as an increase in other expenses which was primarily driven by reserves recorded in the year ended December 31, 2022 for potential losses associated with Russia's Invasion of Ukraine, and an increase in settlements and other provisions.

Total other income (losses), net decreased $320.1 million, or 94.3%, to $19.3 compared to the prior year period, primarily related to a $312.9 million gain on the sale of the Insurance brokerage business in the fourth quarter of 2021, a decrease related to mark-to-market movements on other assets, and a decrease related to income from other recoveries, partially offset by an increase related to gains on equity method investments.

RESULTS OF OPERATIONS

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Brokerage Revenues

Total brokerage revenues decreased by $222.9 million, or 11.9%, to $1,646.8 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, primarily due to the sale of the Insurance brokerage business during the fourth quarter of 2021, and FX headwinds.

Commission revenues decreased by $260.6 million, or 16.9%, to $1,281.3 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

Principal transactions revenues increased by $37.7 million, or 11.5%, to $365.5 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

We had no brokerage revenues from Insurance in the year ended December 31, 2022 as a result of the sale during the fourth quarter of 2021, compared to $178.1 million for the year ended December 31, 2021.

Our Credit revenues decreased by $16.2 million, or 5.6%, to $271.4 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.

This was primarily driven by lower activity across structured products and FX headwinds.

Our brokerage revenues from Equities decreased by $13.2 million, or 5.3%, to $234.5 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021, primarily driven by FX headwinds and lower volumes due to market volatility in the year ended December 31, 2022.

Our brokerage revenues from Rates decreased by $9.0 million, or 1.6%, to $549.5 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.

The decrease in Rates revenue was primarily driven by FX headwinds, challenging market conditions across medium-term Rates products and lower market volumes.

Our brokerage revenues from Energy and commodities decreased by $4.8 million, or 1.6%, to $291.7 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021, which was primarily led by lower volumes across global oil trading as higher prices and volatility weighed on certain energy products, such as gas, oil, and base metals.

Our FX revenues decreased by $1.6 million, or 0.5%, to $299.7 million for the year ended December 31, 2022, as compared to the year ended December 31, 2021.

Fees from Related Parties

Fees from related parties decreased by $0.1 million, or 0.8% to $14.7 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

Data, Software and Post-Trade

Data, software and post-trade revenues increased by $6.4 million, or 7.1%, to $96.4 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

This increase was primarily driven by new business contracts in Fenics Market Data and Lucera expanding its client base, partially offset by a decrease in revenues from post-trade services.

Interest and Dividend Income

Interest and dividend income decreased by $1.0 million, or 4.4%, to $21.0 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

This decrease was primarily driven by a decrease in dividend income and lower interest income earned on employee loans, partially offset by an increase in interest income on government bonds and bank deposits driven by higher interest rates.

Other Revenues

Other revenues decreased by $2.5 million, or 13.4% to $16.4 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

This was primarily driven by a decrease in revenues from underwriting fees and placement fees, partially offset by an increase in consulting income for Poten & Partners.

Compensation and Employee Benefits

Compensation and employee benefits expense decreased by $418.2 million, or 32.9%, to $853.2 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

The primary driver of the decrease was due to the sale of the Insurance brokerage business during the fourth quarter of 2021, which included one-off compensation charges and sale-related expenses totaling $168.6 million, as well as lower commission revenues on variable compensation, increased automation related to the transition to Fully Electronic brokerage services, and the positive FX impact on our U.K.

and European operations.

Equity-Based Compensation and Allocations of Net Income to Limited Partnership Units and FPUs

Equity-based compensation and allocations of net income to limited partnership units and FPUs decreased by $5.1 million, or 2.0%, to $251.1 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

This was driven by a decrease in allocations of net income to limited partnership units and FPUs and a decrease in LPU amortization expense, partially offset by an increase in grants of exchangeability and issuance of Class A common stock.

Occupancy and Equipment

Occupancy and equipment expense decreased by $30.8 million, or 16.4%, to $157.5 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

This decrease was primarily due to the sale of the Insurance brokerage business during the fourth quarter of 2021, as well as a decrease in other rent and occupancy expenses.

Fees to Related Parties

Fees to related parties increased by $1.6 million, or 6.8%, to $25.7 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

Fees to related parties are allocations paid to Cantor for administrative and support services, such as accounting, occupancy, and legal.

Professional and Consulting Fees

Professional and consulting fees increased by $0.9 million, or 1.3%, to $68.8 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, primarily driven by an increase in legal and consulting fees, partially offset by a decrease related to the sale of the Insurance brokerage business during the fourth quarter of 2021.

Communications

Communications expense decreased by $9.4 million, or 8.0%, to $108.1 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, which was primarily driven by decreases in various terminal and line service costs across market data and communications.

Selling and Promotion

Selling and promotion expense increased by $11.2 million, or 29.3%, to $49.2 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, as COVID-19 restrictions have relaxed across many of the major geographies in which BGC operates.

Commissions and Floor Brokerage

Commissions and floor brokerage expense decreased by $6.4 million, or 9.9%, to $58.3 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

Commissions and floor brokerage expense tends to move in line with brokerage revenues.

Interest Expense

Interest expense decreased by $11.4 million, or 16.4%, to $57.9 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, primarily driven by the fact that the 5.125% Senior Notes were repaid in May 2021, a decrease in interest expense related to the borrowings on the Revolving Credit Agreement, and a decrease in interest expense due to the sale of the Insurance brokerage business during the fourth quarter of 2021.

Other Expenses

Other expenses increased by $6.5 million, or 8.1%, to $87.4 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, which was primarily related to an increase in legal settlements, reserves recorded in the year ended December 31, 2022 for potential losses associated with Russia's Invasion of Ukraine, an increase in other provisions, and an increase in revaluation expense.

This was partially offset by a decrease in expenses related to the sale of the Insurance brokerage business during the fourth quarter of 2021, a decrease in amortization expense on intangible assets and a decrease in Charity Day contributions expense.

Other Income (Losses), Net

Gains (Losses) on Divestitures and Sale of Investments

For the year ended December 31, 2022 we had a loss of $1.0 million on divestitures.

For the year ended December 31, 2021, we had a gain of $312.9 million as a result of the sale of the Insurance brokerage business.

Gains (Losses) on Equity Method Investments

Gains (losses) on equity method investments increased by $4.2 million, to a gain of $10.9 million, for the year ended December 31, 2022 as compared to a gain of $6.7 million for the year ended December 31, 2021.

Other Income (Loss)

Other income (loss) decreased by $10.3 million, or 52.4%, to $9.4 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021, primarily driven by a decrease related to mark-to-market movements on other assets and investments, and no income for the year ended December 31, 2022 related to the Insurance brokerage business due to the sale in the fourth quarter of 2021, partially offset by an increase related to fair value adjustments on acquisition earn-outs.

Provision (Benefit) for Income Taxes

Provision (benefit) for income taxes increased by $15.6 million, or 67.7%, to $38.6 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

The increase was primarily driven by:

(i) the non-recurring nontaxable gain on the 2021 disposition of the Insurance brokerage business;

(ii) a benefit in the prior year from the revaluation of deferred taxes due to enacted rate changes in the U.K.

and the ownership interest change in the operating partnership;

and (iii) a change in the geographical and business mix of earnings, which can impact our consolidated effective tax rate from period-to-period.

Net Income (Loss) Attributable to Noncontrolling Interest in Subsidiaries

Net income (loss) attributable to noncontrolling interest in subsidiaries decreased by $19.3 million, or 65.6%, to $10.2 million for the year ended December 31, 2022 as compared to the year ended December 31, 2021.

Year Ended December 31, 2021 Compared to Year Ended December 31, 2020

Brokerage Revenues

Total brokerage revenues decreased by $49.6 million, or 2.6%, to $1,869.7 million for the year ended December 31, 2021 as compared to the year ended December 31, 2020.

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Principal transactions revenues decreased by $23.9 million, or 6.8%, to $327.8 million for the year ended December 31, 2021 as compared to the year ended December 31, 2020.

The decrease in total brokerage revenues was primarily driven by decreases in Credit, FX, Equity derivatives and cash equities, and Insurance, partially offset by an increase in revenues from Rates, and Energy and commodities.

The decrease in total brokerage revenues was primarily driven by decreases in Credit, FX, Equities, and Insurance, partially offset by an increase in revenues from Rates, and Energy and commodities.

Our Credit revenues decreased by $42.3 million, or 12.8%, to $287.6 million for the year ended December 31, 2021, as compared to the year ended December 31, 2020.

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This decrease was primarily driven by lower industry volumes.

Our brokerage revenues from Equity derivatives and cash equities decreased by $7.0 million, or 2.8%, to $247.7 million for the year ended December 31, 2021, as compared to the year ended December 31, 2020.

Our brokerage revenues from Equities decreased by $7.0 million, or 2.8%, to $247.7 million for the year ended December 31, 2021, as compared to the year ended December 31, 2020.

This decrease was primarily driven by lower volumes across European equity derivatives.

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Net income (loss) attributable to noncontrolling interest in subsidiaries increased by $23.6 million, to $29.5 million for the year ended December 31, 2021 as compared to the year ended December 31, 2020.

Year Ended December 31, 2020 Compared to Year Ended December 31, 2019

Brokerage Revenues

Total brokerage revenues decreased by $48.4 million, or 2.5%, to $1,919.3 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Commission revenues decreased by $78.2 million, or 4.7%, to $1,567.7 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Principal transactions revenues increased by $29.7 million, or 9.2%, to $351.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

The decrease in total brokerage revenues was primarily driven by decreases in FX and Rates, partially offset by an increase in revenues from Insurance, Credit, Energy and commodities, and Equity derivatives and cash equities.

Our FX revenues decreased by $55.1 million, or 14.9%, to $315.3 million for the year ended December 31, 2020.

This decrease was primarily driven by lower industry volumes due to quantitative easing undertaken by several major central banks and uniformly lower global interest rates.

Our brokerage revenues from Rates decreased by $50.8 million, or 8.5%, to $544.1 million for the year ended December 31, 2020.

The decrease in Rates revenues was primarily driven by lower industry volumes in certain markets due to quantitative easing undertaken by several major central banks and uniformly lower global interest rates.

Our brokerage revenues from Insurance increased by $26.9 million, or 17.3%, to $182.7 million for the year ended December 31, 2020.

This increase was primarily due to organic growth, as previously hired brokers and salespeople ramped up production and benefited from favorable pricing trends for insurance renewals.

Our Credit revenues increased by $23.2 million, or 7.6%, to $329.9 million for the year ended December 31, 2020.

This increase was mainly due to greater trading volumes.

Our brokerage revenues from Energy and commodities increased by $3.9 million, or 1.4%, to $292.6 million for the year ended December 31, 2020.

This increase was primarily driven by organic growth.

Our brokerage revenues from equity derivatives and cash equities increased by $3.4 million, or 1.3%, to $254.7 million for the year ended December 31, 2020.

This was primarily driven by organic growth.

Fees from Related Parties

Fees from related parties decreased by $3.7 million, or 12.5% to $25.8 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Data, Software and Post-Trade

Data, software and post-trade revenues increased by $8.8 million, or 12.0%, to $81.9 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This increase was primarily driven by Lucera’s Connect platform winning new SaaS client contracts, the acquisition of Algomi, as well as an increase in revenues from post-trade services.

Interest and Dividend Income

Interest and dividend income decreased by $6.0 million, or 32.7%, to $12.3 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This decrease was primarily due to a decrease in dividend income and lower interest earned on deposits.

Other Revenues

Other revenues increased by $1.5 million, or 9.5% to $17.5 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This increase was primarily driven by an increase in consulting income for Poten & Partners.

Compensation and Employee Benefits

Compensation and employee benefits expense increased by $5.5 million, or 0.5%, to $1,132.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

The main drivers of this increase were costs associated with the implementation of a cost reduction program designed to reduce future expenses and streamline operations, partially offset by the impact of lower brokerage revenues on variable compensation.

Equity-Based Compensation and Allocations of Net Income to Limited Partnership Units and FPUs

Equity-based compensation and allocations of net income to limited partnership units and FPUs increased by $12.9 million, or 7.6%, to $183.5 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This increase was primarily driven by an increase in equity award amortization.

Occupancy and Equipment

Occupancy and equipment expense increased by $6.7 million, or 3.6%, to $192.8 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This increase was primarily driven by higher software license costs, amortization expense on developed software, and fixed asset impairments.

This was partially offset by a decrease in rent expense related to the build-out phase of BGC’s new U.K.

— based headquarters in the prior year period.

Fees to Related Parties

Fees to related parties increased by $3.8 million, or 19.4%, to $23.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Fees to related parties are allocations paid to Cantor for administrative and support services, such as accounting, occupancy, and legal.

Professional and Consulting Fees

Professional and consulting fees decreased by $19.0 million, or 20.4%, to $74.1 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This decrease was primarily driven by a decrease in legal and consulting fees.

Communications

Communications expense increased by $1.6 million, or 1.3%, to $121.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Selling and Promotion

Selling and promotion expense decreased by $43.6 million, or 53.3%, to $38.2 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This decrease was primarily a result of a reduction in travel and entertainment expenses due to a continued focus on tighter cost management as well as the impact of COVID-19.

Commissions and Floor Brokerage

Commissions and floor brokerage expense decreased by $4.2 million, or 6.7%, to $59.4 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

Commissions and floor brokerage expense tends to move in line with brokerage revenues.

Interest Expense

Interest expense increased by $16.4 million, or 27.2%, to $76.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This increase was primarily driven by interest expense related to the 3.750% Senior Notes issued in September 2019 and interest expense on the 4.375% Senior Notes issued in July 2020, partially offset by lower interest expense related to the borrowings on BGC’s Revolving Credit Agreement.

Other Expenses

Other expenses decreased by $29.6 million, or 25.0%, to $89.0 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019, which was primarily related to a decrease in settlements, and partially offset by an increase in other provisions.

Other Income (Losses), Net

Gains (Losses) on Divestitures and Sale of Investments

For the year ended December 31, 2020, we had a gain of $394 thousand on divestitures.

For the year ended December 31, 2019, there was a gain of $18.4 million as a result of the sale of CSC Commodities.

Gains (Losses) on Equity Method Investments

Gains (losses) on equity method investments increased by $0.9 million, to a gain of $5.0 million, for the year ended December 31, 2020 as compared to a gain of $4.1 million for the year ended December 31, 2019.

Gains (losses) on equity method investments represent our pro-rata share of the net gains or losses on investments over which we have significant influence, but which we do not control.

Other Income (Loss)

Other income (loss) decreased by $28.9 million, or 94.8%, to $1.6 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This was primarily driven by a decrease related to fair value adjustments on investments carried under the measurement alternative.

There was also a decrease related the mark-to-market and/or hedging on the Nasdaq shares.

Provision (Benefit) for Income Taxes

Provision (benefit) for income taxes decreased by $28.5 million, or 57.2%, to $21.3 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019.

This decrease was primarily driven by lower pre-tax earnings, as well as a change in the geographical and business mix of earnings.

In addition, our consolidated effective tax rate can vary from period-to-period depending on, among other factors, the geographic and business mix of our earnings.

Net Income (Loss) Attributable to Noncontrolling Interest in Subsidiaries

Net income (loss) attributable to noncontrolling interest in subsidiaries decreased by $17.1 million, or 74.4%, to $5.9 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019, which was primarily driven by a decrease in earnings.

QUARTERLY RESULTS OF OPERATIONS

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Credit 68,067 58,187 61,257 83,908 65,969 58,983 72,609 90,047

Equity derivatives and

cash equities 61,671 54,715 60,825 70,462 63,718 47,410 61,777 81,797

Equities 60,690 48,384 58,291 67,128 61,671 54,715 60,825 70,462

Insurance — — — — 19,889 51,503 54,315 52,380

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Credit 17.1 15.3 15.4 17.8 15.6 13.4 15.4 16.9

Equity derivatives and

cash equities 14.6 12.4 12.9 13.2 14.2 11.3 12.8 14.4

Equities 15.3 12.8 14.6 14.2 14.6 12.4 12.9 13.2

Insurance — — — — 4.7 11.7 11.6 9.8

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Total assets as of December 31, 2022 were $3.1 billion, a decrease of 8.0% as compared to December 31, 2021.

The decrease in total assets was driven by a decrease in Cash segregated under regulatory requirements as well as Accrued commissions and other receivables, net primarily due to the Insurance Business Disposition.

We maintain a significant portion of our assets in Cash and cash equivalents and Securities owned, with our liquidity (which we define as Cash and cash equivalents, Reverse repurchase agreements, Marketable securities and Securities owned, less Securities loaned and Repurchase Agreements) as of December 31, 2021 of $594.8 million.

The decrease in total assets was driven by a decrease in Receivables from broker-dealers, clearing organizations, customers and related broker-dealers, Cash and cash equivalents, as well as Other intangible assets, net.

We maintain a significant portion of our assets in Cash and cash equivalents and Financial instruments owned, at fair value, with Cash and cash equivalents as of December 31, 2022 of $485.0 million, and our liquidity (which we define as Cash and cash equivalents, Reverse repurchase agreements, and Financial instruments owned, at fair value, less Securities loaned and Repurchase Agreements) as of December 31, 2022 of $524.3 million.

See “Liquidity Analysis” below for a further discussion of our liquidity.

Our Securities owned were $40.8 million as of December 31, 2021, compared to $58.6 million as of December 31, 2020.

Our Marketable securities were $0.4 million as of December 31, 2021 compared to $0.3 million as of December 31, 2020.

Our Financial instruments owned, at fair value were $39.3 million as of December 31, 2022, compared to $41.2 million as of December 31, 2021.

We had no Repurchase agreements as of December 31, 2022 and 2021.

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As part of our cash management process, we may enter into tri-party reverse repurchase agreements and other short-term investments, some of which may be with Cantor.

As of December 31, 2021 and 2020, there were no reverse repurchase agreements outstanding.

As of both December 31, 2022 and 2021, there were no reverse repurchase agreements outstanding.

Additionally, in August 2013, the Audit Committee authorized us to invest up to $350 million in an asset-backed commercial paper program for which certain Cantor entities serve as placement agent and referral agent.

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The notes are backed by assets of highly rated banks.

We are entitled to invest in the program so long as the program meets investment policy guidelines, including policies relating to ratings.

We are entitled to invest in the program so long as the program meets

investment policy guidelines, including policies relating to ratings.

Cantor will earn a spread between the rate it receives from the short-term note issuer and the rate it pays to us on any investments in this program.

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We believe that cash and cash equivalents in and available to our largest regulated entities, inclusive of financing provided by clearing banks and cash segregated under regulatory requirements, is adequate for potential cash demands of normal operations, such as margin or financing of fails.

We expect our operating activities going forward to generate adequate cash flows to fund normal operations, including any dividends paid pursuant to our dividend policy.

We expect our operating activities going forward to generate adequate cash flows to fund normal operations, share and unit repurchases and redemptions, and any dividends paid pursuant to our dividend policy.

However, we continually evaluate opportunities for growth and to further enhance our strategic position, including, among other things, acquisitions, strategic alliances and joint ventures potentially involving all types and combinations of equity, debt and acquisition alternatives.

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In addition, as a result of regulatory actions, our registration statements under the Securities Act will be subject to SEC review prior to effectiveness, which may lengthen the time required for us to raise capital, potentially reducing our access to the capital markets or increasing our cost of capital.

As discussed above, our liquidity remains strong at $594.8 million as of December 31, 2021, which reflects, gross cash proceeds received for the Insurance Business Disposition, ordinary movements in working capital, repurchases of BGC Class A common stock and LPUs, cash paid with respect to employee bonuses, tax payments, our continued investment in Fenics Growth Platforms, and the maturity of the 5.125% Senior Notes paid in full.

As discussed above, our liquidity remains strong at $524.3 million as of December 31, 2022, which can be used for share and unit repurchases and redemptions, dividends and distributions, new hires, tax payments, ordinary movements in working capital, and our continued investment in Fenics Growth Platforms.

On November 1, 2021, BGC closed the sale of its Insurance brokerage business to the Ardonagh Group for gross proceeds of $534.9 million, subject to limited post-closing adjustments.

The investment in the Insurance brokerage business generated an internal rate of return of 21.2% for our shareholders.

The proceeds from the Insurance Business Disposition provides us with significant resources to continue repurchasing shares and to accelerate Fenics growth.

The proceeds from the Insurance Business Disposition provided us with significant resources to continue repurchasing shares and to accelerate Fenics growth.

Since the announced sale of the Insurance brokerage business in May 2021, BGC has repurchased and redeemed 99.8 million shares of BGC Class A common stock and LPUs as of December 31, 2022.

In addition, a portion of these proceeds was used to fully repay the $300.0 million outstanding borrowings under the Company's Revolving Credit Agreement on November 1, 2021, which had been borrowed during the year.

This repayment along with the maturity of the 5.125% Senior Notes, which were paid in full on May 27, 2021, reduced our outstanding Notes payable and other borrowings by $263.1 million as of December 31, 2021 compared to the prior year.

This repayment along with the maturity of the 5.125% Senior Notes, which were paid in full on May 27, 2021, reduced our outstanding Notes payable and other borrowings.

On February 24, 2023, our Board declared a $0.01 dividend for the fourth quarter of 2022.

Additionally, BGC Holdings continues to have reduced distributions to or on behalf of its partners.

The distributions to or on behalf of partners will

at least cover their related tax payments.

The distributions to or on behalf of partners will at least cover their related tax payments.

Whether any given post-tax amount is equivalent to the amount received by a stockholder also on an after-tax basis depends upon stockholders’ and partners’ domiciles and tax status.

BGC believes that these steps will allow the Company to prioritize its financial strength.

Our 2022 capital allocation priorities are to return capital to stockholders and to continue investing in our high growth Fenics businesses.

Previously, we were deeply dividend-centric;

Our current capital allocation priorities are to return capital to stockholders and to continue investing in our high growth Fenics businesses.

Historically, we were deeply dividend-centric;

going forward, we plan to prioritize share and unit repurchases over dividends and distributions.

The Board will reevaluate whether to increase the dividend in the first quarter of 2022.

Notes Payable, Other and Short-term Borrowings

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On November 28, 2018, we entered into the Revolving Credit Agreement with Bank of America, N.A., as administrative agent, and a syndicate of lenders, which replaced the existing committed unsecured senior revolving credit agreement.

The maturity date of the Revolving Credit Agreement was November 28, 2020 and the maximum revolving loan balance is $350.0 million.

Borrowings under this agreement bear interest at either LIBOR or a defined base rate plus additional margin.

On December 11, 2019, we entered into an amendment to the new unsecured Revolving Credit Agreement.

The maturity date of the Revolving Credit Agreement was November 28, 2020 and the maximum revolving loan balance was $350.0 million.

Borrowings under this Revolving Credit Agreement bore interest at either LIBOR or a defined base rate plus additional margin.

On December 11, 2019, we entered into an amendment to the Revolving Credit Agreement.

Pursuant to the amendment, the maturity date was extended to February 26, 2021.

On February 26, 2020, the Company entered into a second amendment to the unsecured revolving credit agreement, pursuant to which, the maturity date was extended by two years to February 26, 2023.

On February 26, 2020, the Company entered into a second amendment to the Revolving Credit Agreement, pursuant to which, the maturity date was extended by two years to February 26, 2023.

The size of the Revolving Credit Agreement, along with the interest rate on the borrowings therefrom, remained unchanged.

On November 1, 2021, the Company repaid in full the $300.0 million borrowings outstanding under the Revolving Credit Agreement, which had been borrowed during the year.

As of December 31, 2021 and 2020, there were no borrowings outstanding under the new unsecured Revolving Credit Agreement.

The average interest rate on the outstanding borrowings was 2.09% and 2.88% for the years ended December 31, 2021 and 2020, respectively.

We may draw down on the Revolving Credit Agreement to provide flexibility in the normal course to meet ongoing operational cash needs, and other general corporate purposes including as necessary to manage through the current extraordinary macroeconomic/business environment as a result of the COVID-19 pandemic.

On November 1, 2021, the Company repaid in full the $300.0 million borrowings outstanding under the Revolving Credit Agreement, which had been borrowed earlier in 2021.

On March 10, 2022, we entered into an amendment and restatement of the senior unsecured revolving credit agreement, pursuant to which, the maturity date was extended to March 10, 2025, the size of the credit facility was increased to $375.0 million, and borrowings under this agreement will bear interest based on either SOFR or a defined base rate plus additional margin.

As of December 31, 2022 and 2021, there were no borrowings outstanding under the Revolving Credit Agreement.

From January 1, 2023 through March 1, 2023, the Company drew down $70.0 million from its Revolving Credit Agreement.

This amount currently carries an interest rate of 6.4%.

Our liquidity remains strong, and was $524.3 million as of December 31, 2022, as discussed below.

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As a result of this transaction, $14 thousand in dealer management fees were paid to CF&Co.

Cantor tendered $15.0 million of such senior notes in the tender offer, and did not hold such notes as of December 31, 2021.

Cantor tendered $15.0 million of such senior notes in the tender offer.

The initial carrying value of the 5.125% Senior Notes was $295.8 million, net of the discount and debt issuance costs of $4.2 million, of which $0.5 million were underwriting fees payable to CF&Co.

On August 16, 2016, we filed a Registration Statement on Form S-4 which was declared effective by the SEC on September 13, 2016.

On September 15, 2016, BGC launched an exchange offer in which holders of the 5.125% Senior Notes, issued in a private placement on May 27, 2016.

could exchange such notes for new registered notes with substantially identical terms.

On September 15, 2016, BGC launched an exchange offer in which holders of the 5.125% Senior Notes, issued in a private placement on May 27, 2016, could exchange such notes for new registered notes with substantially identical terms.

The exchange offer closed on October 12, 2016, at which point the initial 5.125% Senior Notes were exchanged for new registered notes with substantially identical terms.

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5.375% Senior Notes

On July 24, 2018, we issued an aggregate of $450.0 million principal amount of 5.375% Senior Notes The 5.375% Senior Notes are general senior unsecured obligations of the Company.

On July 24, 2018, we issued an aggregate of $450.0 million principal amount of 5.375% Senior Notes.

The 5.375% Senior Notes are general senior unsecured obligations of the Company.

The 5.375% Senior Notes bear interest at a rate of 5.375% per year, payable in cash on January 24 and July 24 of each year, commencing January 24, 2019.

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We may redeem some or all of the 5.375% Senior Notes at any time or from time to time for cash at certain “make-whole” redemption prices (as set forth in the indenture related to the 5.375% Senior Notes).

If a “Change of Control Triggering Event” (as defined in the indenture related to the 5.375% Senior Notes) occurs, holders may

require the Company to purchase all or a portion of their notes for cash at a price equal to 101% of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date.

If a “Change of Control Triggering Event” (as defined in the indenture related to the 5.375% Senior Notes) occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101% of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date.

The initial carrying value of the 5.375% Senior Notes was $444.2 million, net of the discount and debt issuance costs of $5.8 million, of which $0.3 million were underwriting fees paid to CF&Co.

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The carrying value of the 5.375% Senior Notes as of December 31, 2022 was $449.2 million.

We intend to either refinance the 5.375% Senior Notes prior to maturity, or use cash on hand, cash flow from operations or the Revolving Credit Agreement to settle such amounts.

On July 31, 2018, we filed a Registration Statement on Form S-4 which was declared effective by the SEC on August 10, 2018.

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The 3.750% Senior Notes are general unsecured obligations of the Company.

The 3.750% Senior Notes bear interest at a rate of 3.750% per annum, payable in cash on each April 1 and October 1, commencing April 1, 2020.

The 3.750% Senior Notes bear interest at a rate of 3.750% per year, payable in cash on April 1 and October 1 of each year, commencing April 1, 2020.

The 3.750% Senior Notes will mature on October 1, 2024.

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If a “Change of Control Triggering Event” (as defined in the indenture related to the 3.750% Senior Notes) occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101% of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date.

The initial carrying value of the 3.750% Senior Notes was $296.1 million, net of discount and debt issuance costs of $3.9 million, of which $0.2 million were underwriting fees payable to CF&Co and $36 thousand were underwriting fees payable to CastleOak Securities, L.P.

The initial carrying value of the 3.750% Senior Notes was $296.1 million, net of discount and debt issuance costs of $3.9 million, of which $0.2 million were underwriting fees payable to CF&Co.

The issuance costs will be amortized as interest expense and the carrying value of the 3.750% Senior Notes will accrete up to the face amount over the term of the notes.

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On October 11, 2019, we filed a Registration Statement on Form S-4, which was declared effective by the SEC on October 24, 2019.

On October 28, 2019, BGC launched an exchange offer in which holders of the 3.750% Senior Notes, issued in a private placement on September 27, 2019, may exchange such notes for new registered notes with substantially identical terms.

On October 28, 2019, BGC launched an exchange offer in which holders of the 3.750% Senior Notes, issued in a private placement on September 27, 2019, could exchange such notes for new registered notes with substantially identical terms.

The exchange offer closed on December 9, 2019, at which point the initial 3.750% Senior Notes were exchanged for new registered notes with substantially identical terms.

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The 4.375% Senior Notes are general unsecured obligations of the Company.

The 4.375% Senior Notes bear interest at a rate of 4.375% per year, payable in cash on June 15 and December 15, commencing December 15, 2020.

The 4.375% Senior Notes bear interest at a rate of 4.375% per year, payable in cash on June 15 and December 15 of each year, commencing December 15, 2020.

The 4.375% Senior Notes will mature on December 15, 2025.

We may redeem some or all of the notes at any time or from time to time for cash at certain “make-whole” redemption prices (as set forth in the indenture related to the 4.375% Senior Notes).

We may redeem some or all of the 4.375% Senior Notes at any time or from time to time for cash at certain “make-whole” redemption prices (as set forth in the indenture related to the 4.375% Senior Notes).

If a “Change of Control Triggering Event” (as defined in the indenture related to the 4.375% Senior Notes) occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101% of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date.

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On August 28, 2020, we filed a Registration Statement on Form S-4, which was declared effective by the SEC on September 8, 2020.

On September 9, 2020, BGC launched an exchange offer in which holders of the 4.375% Senior Notes, issued in a private placement on July 10, 2020, may exchange such notes for new registered notes with substantially identical terms.

On September 9, 2020, BGC launched an exchange offer in which holders of the 4.375% Senior Notes, issued in a private placement on July 10, 2020, could exchange such notes for new registered notes with substantially identical terms.

The exchange offer closed on October 14, 2020, at which point the initial 4.375% Senior Notes were exchanged for new registered notes with substantially identical terms.

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On May 31, 2017, we entered into a secured loan arrangement of $29.9 million under which we pledged certain fixed assets as security for a loan.

This arrangement incurs interest at a fixed rate of 3.44% per year and matured on May 31, 2021,

therefore, there were no borrowings outstanding as of December 31, 2021.

As of December 31, 2020, we had $4.0 million outstanding related to this secured loan arrangement.

The book value of the fixed assets pledged as of December 31, 2020 was $0.8 million.

On April 8, 2019, we entered into a secured loan arrangement of $15.0 million, under which we pledged certain fixed assets as security for a loan.

This arrangement incurs interest at a fixed rate of 3.77% and matures on April 8, 2023.As of December 31, 2021 and 2020, the Company had $5.9 million and $9.6 million, respectively, outstanding related to this secured loan arrangement.

The book value of the fixed assets pledged as of December 31, 2021 and 2020, was $0.1 million and $1.2 million, respectively.

This arrangement incurred interest at a fixed rate of 3.44% per year and matured on May 31, 2021, therefore, there were no borrowings outstanding as of both December 31, 2022 and 2021.

On April 8, 2019, we entered into a secured loan arrangement of $15.0 million, under which we pledged certain fixed assets as security for a loan.

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As of December 31, 2022 and 2021, we had $2.0 million and $5.9 million, respectively, outstanding related to this secured loan arrangement.

The book value of the fixed assets pledged as of December 31, 2022 and 2021, was $10 thousand and $0.1 million, respectively.

On April 19, 2019, we entered into a secured loan arrangement of $10.0 million, under which we pledged certain fixed assets as security for a loan.

This arrangement incurs interest at a fixed rate of 3.89% and matures on April 19, 2023.

December 31, 2022 and 2021, we had $1.3 million and $3.8 million, respectively, outstanding related to this secured loan arrangement.

The book value of the fixed assets pledged as of December 31, 2022 and 2021, was $0.3 million and $1.0 million, respectively.

Weighted-average Interest Rate

For the years ended December 31, 2021 and 2020, the weighted-average interest rate of our total Notes payable and other borrowings, which include our Unsecured Senior Revolving Credit Agreement, Senior Notes, and Collateralized Borrowings, was 4.62% and 4.71%, respectively.

For the years ended December 31, 2022 and 2021, the weighted-average interest rate of our total Notes payable and other borrowings, which include our Revolving Credit Agreement, Company Debt Securities, and collateralized borrowings, was 4.62% and 4.62%, respectively.

Short-term Borrowings

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The credit agreement provided for short-term loans of up to $3.8 million (BRL 20.0 million).

The agreement was automatically renewed every 180 days until August 13, 2021, when it was repaid in full.

Borrowings under this agreement bore interest at the Brazilian Interbank offering rate plus 4.75%.

The maturity date of the agreement is March 8, 2023.

Borrowings under this agreement bear interest at the Brazilian Interbank offering rate plus 3.20%.

As of December 31, 2022, there were $1.9 million (BRL 10.0 million) of borrowings outstanding under the agreement.

As of December 31, 2021, there were no borrowings outstanding under the facility.

As of December 31, 2020, there were $3.8 million (BRL 20.0 million) of borrowings outstanding under the facility.

As of December 31, 2022, the interest rate was 17.0%.

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On August 20, 2021, the agreement was renegotiated, increasing the credit line to $11.5 million (BRL 60.0 million).

The maturity date of the agreement is March 9, 2022.

The maturity date of the agreement is May 21, 2023.

This agreement bears a fee of 1.35% per year.

As of December 31, 2021 and December 31, 2020, there were no borrowings outstanding under this agreement

As of December 31, 2022 and 2021, there were no borrowings outstanding under this agreement.

On January 25, 2021, we entered into a committed unsecured loan agreement with Banco Daycoval S.A., which provided for short-term loans of up to $1.9 million (BRL 10.0 million) and was renegotiated on June 1, 2021.

The amended agreement provides for short-term loans of up to $3.6 million (BRL 20.0 million).

The maturity date of the agreement is January 17, 2023.

Borrowings under this agreement bear interest at the Brazilian Interbank offering rate plus 3.66%.

As of December 31, 2021, there were $3.6 million (BRL 20.0 million) of borrowings outstanding under the agreement.

As of December 31, 2021, the interest rate was 12.90%.

The amended agreement provided for short-term loans of up to $3.8 million (BRL 20.0 million).

Borrowings under this agreement bore interest at the Brazilian Interbank offering rate plus 3.66%.

During September 2022, the borrowings under this agreement were repaid in full, and the loan was terminated on September 27, 2022, therefore as of December 31, 2022, there were no borrowings outstanding under the agreement.

As of December 31, 2021, there were no borrowings outstanding under this agreement.

BGC Credit Agreement with Cantor

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CREDIT RATINGS

As of December 31, 2021, our public long-term credit ratings and associated outlooks are as follows:

As of December 31, 2022, our public long-term credit ratings and associated outlooks were as follows:

Rating Outlook

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LIQUIDITY ANALYSIS

We consider our liquidity to be comprised of the sum of Cash and cash equivalents, Reverse repurchase agreements, Marketable securities, and Securities owned, less Securities loaned and Repurchase agreements.

We consider our liquidity to be comprised of the sum of Cash and cash equivalents, Reverse repurchase agreements, and Financial instruments owned, at fair value, less Securities loaned and Repurchase agreements.

We consider liquidity to be an important metric for determining the amount of cash that is available or that could be readily available to the Company on short notice.

The discussion below describes the key components of our liquidity analysis.

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These timing differences will impact our cash flows in a given period;

Our investing and funding activities represent a combination of our capital raising activities, including short-term borrowings and repayments, issuances of shares under our CEO Program (net), BGC Class A common stock repurchases and partnership unit redemptions, purchases and sales of securities, dispositions, and other investments (e.g., acquisitions, forgivable loans to new brokers and capital expenditures—all net of depreciation and amortization).

• Our investing and funding activities represent a combination of our capital raising activities, including short-term borrowings and repayments, BGC Class A common stock repurchases and partnership unit redemptions, purchases and sales of securities, dispositions, and other investments (e.g., acquisitions, forgivable loans to new brokers and capital expenditures—all net of depreciation and amortization);

• Our securities settlement activities primarily represent deposits with clearing organizations;

• Other changes in working capital represent changes primarily in receivables and payables and accrued liabilities that impact our liquidity;

Changes in Reverse repurchase agreements, Securities owned, and Marketable securities may result from additional cash investments or sales, which will be offset by a corresponding change in Cash and cash equivalents and, accordingly, will not result in a change in our liquidity.

• Changes in Reverse repurchase agreements and Financial instruments owned, at fair value may result from additional cash investments or sales, which will be offset by a corresponding change in Cash and cash equivalents and, accordingly, will not result in a change in our liquidity.

Conversely, changes in the market value of such securities are reflected in our earnings or other comprehensive income (loss) and will result in changes in our liquidity.

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An installment election can be made to pay the taxes over eight years with 40% paid in equal installments over the first five years and the remaining 60% to be paid in installments of 15%, 20% and 25% in years six, seven and eight, respectively.

The cumulative remaining balance as of December 31, 2021 is $20.2 million.

The cumulative remaining balance as of December 31, 2022 was $20.2 million.

As of December 31, 2022, the Company and its consolidated subsidiaries had $485.0 million of Cash and cash equivalents.

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Cash and cash equivalents $ 484,989 $ 553,598

Securities owned 40,838 58,572

Marketable securities

Financial instruments owned, at fair value 39,319 41,244

Repurchase agreements — —

Total $ 524,308 $ 594,842

The $60.4 million decrease in our liquidity position from $655.2 million as of December 31, 2020 to $594.8 million as of December 31, 2021 was primarily related to 72.9 million repurchases of Class A common stock and LPUs, cash paid with respect to annual employee bonuses, tax payments, our continued investment in Fenics Growth Platforms, and the maturity of the 5.125% Senior Notes paid in full, partially offset by the gross cash proceeds received for the Insurance Business Disposition, earnings, and other ordinary movements in working capital.

The $70.5 million decrease in our liquidity position from $594.8 million as of December 31, 2021 to $524.3 million as of December 31, 2022 was primarily related to share and unit repurchases and redemptions, dividends and distributions, tax payments, our continued investment in Fenics Growth Platforms and ordinary movements in working capital,.

Discussion of the year ended December 31, 2021

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Cash and cash equivalents $ 553,598 $ 596,291

Securities owned 58,572 57,525

Marketable securities 1

Financial instruments owned, at fair value 41,244 58,921

Repurchase agreements

Total $ 594,842 $ 655,212

__________________________

1 As of December 31, 2019, $13.9 million of Marketable securities on our balance sheet had been lent in a Securities loaned transaction and, therefore, are not included in this Liquidity Analysis.

The $179.3 million increase in our liquidity position from $473.2 million as of December 31, 2019 to $652.6 million as of December 31, 2020 was primarily related to the issuance of $300.0 million of the 4.375% Senior Notes, partially reduced by the $68.9 million net payoff of the Revolving Credit Agreement and the $44.0 million cash tender offer on the 5.125% Senior Notes.

This net increase was partially offset by ordinary movements in working capital (including settlement of payables to related parties), cash paid with respect to annual employee bonuses and associated tax and compensation expenses, cost reduction charges, tax payments, acquisitions and our continued investment in new revenue generating hires.

CLEARING CAPITAL

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In addition, self-regulatory organizations, such as the FINRA and the NFA, along with statutory bodies such as the FCA, the SEC, and the CFTC require strict compliance with their rules and regulations.

The requirements imposed by regulators are designed to ensure the integrity of the financial markets and to protect customers and other third parties who deal

with broker-dealers and are not designed to specifically protect stockholders.

The requirements imposed by regulators are designed to ensure the integrity of the financial markets and to protect customers and other third parties who deal with broker-dealers and are not designed to specifically protect stockholders.

These regulations often serve to limit our activities, including through net capital, customer protection and market conduct requirements.

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These subsidiaries may also be prohibited from repaying the borrowings of their parents or affiliates, paying cash dividends, making loans to their parent or affiliates or otherwise entering into transactions, in each case, which result in a significant reduction in their regulatory capital position without prior notification or approval from their principal regulator.

See Note 22—“Regulatory Requirements” to our consolidated financial statements for further details on our regulatory requirements.

See Note 21—“Regulatory Requirements” to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K for further details on our regulatory requirements.

As of December 31, 2022, $666.0 million of net assets were held by regulated subsidiaries.

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Mandatory Dodd-Frank Act compliant execution on SEFs by eligible U.S.

persons commenced in February 2014 for “made available to trade” products, and a wide range of other rules relating to the execution and clearing of derivative products have been finalized with implementation periods in 2016 and beyond.

We also own ELX, which became a dormant contract market on July 1, 2017.

persons commenced in February 2014 for “made available to trade” products, and a wide range of other rules relating to the execution and clearing of derivative products were finalized with implementation periods in 2016 and beyond.

We also own ELX, which became a dormant contract market on July 1, 2017 and in July 2021, we completed the purchase of the Futures Exchange Group from Cantor, which represents our futures exchange and related clearinghouse.

As these rules require authorized execution facilities to maintain robust front-end and back-office IT capabilities and to make large and ongoing technology investments, and because these execution facilities may be supported by a variety of voice and auction-based execution methodologies, we expect our Hybrid and Fully Electronic trading capability to perform strongly in such an environment.

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In addition, it has impacted a number of key areas, including corporate governance, transaction reporting, pre- and post-trade transparency, technology synchronization, best execution and investor protection.

MiFID II is intended to help improve the functioning of the EU single market by achieving a greater consistency of regulatory standards.

By design, therefore, it is intended that EU member states should have very similar regulatory regimes in relation to the matters addressed to MiFID.

MiFID II has also introduced a new regulated execution venue category known as an OTF that captures much of the Voice-and Hybrid-oriented trading in EU.

MiFID II was intended to help improve the functioning of the EU single market by achieving a greater consistency of regulatory standards.

By design, therefore, it was intended that EU member states should have very similar regulatory regimes in relation to the matters addressed to MiFID.

MiFID II has also introduced a new regulated execution venue category called an OTF that captures much of the Voice-and Hybrid-oriented trading in the EU.

Much of our existing EU derivatives and fixed income execution business now take place on OTFs.

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The GDPR may affect our practices, and will increase financial penalties for non-compliance significantly.

On September 30, 2020, the SEC announced a settlement with BGC regarding alleged negligent disclosure violations related to one of BGC's non-GAAP financial measures for periods beginning with the first quarter of 2015 through the first quarter of 2016.

All of the relevant disclosures related to those periods and pre-dated the SEC staff’s May 2016 detailed compliance and disclosure guidance with respect to non-GAAP presentations.

BGC revised its non-GAAP presentation beginning with the second quarter of 2016 as a result of the SEC’s guidance, and the SEC has made no allegations with regard to any periods following the first quarter of 2016.

In connection with the SEC settlement, BGC was ordered to cease and desist from any future violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act, Section 13(a) of the Exchange Act and Rule 13a-11 thereunder, and Rule 100(b) of Regulation G, and agreed to pay a civil penalty of $1.4 million without admitting or denying the SEC’s allegations.

Apart from some minor non-material changes, at this time there has not been any legislation from the EU Commission or the U.K.

Government that have materially changed how the U.K.

and EU approach financial regulation since MiFID II and the implementation of Brexit.

Although divergence of U.K.

regulation from EU regulation may occur, there has been no firm legislative change signaled or published by the FCA or the U.K.

While we generally believe the net impact of the rules and regulations are positive for our business, it is possible that unintended consequences of the rules and regulations may materially adversely affect us in ways yet to be determined.

See “Regulation” included in Part I, Item 1 of this Annual Report on Form 10-K for additional information related to our regulatory environment.

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Other issuances of BGC Class A common stock 501 417

Issuance of BGC Class A common stock for general corporate purposes — 45

Treasury stock repurchases (27,087) (68,253)

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Unit Redemptions and Share Repurchase Program

The Board and Audit Committee have authorized repurchases of BGC Class A common stock and redemptions of limited partnership interests or other equity interests in our subsidiaries.

On August 3, 2021, the Board and Audit Committee increased the Company’s share repurchase and unit redemption authorization to $400.0 million, which may include purchases from Cantor, its partners or employees or other affiliated persons or entities.

The Company's Board and Audit Committee have authorized repurchases of BGC Class A common stock and redemptions of limited partnership interests or other equity interests in the Company's subsidiaries.

On August 3, 2021, the Company's Board and Audit Committee increased the BGC Partners share repurchase and unit redemption authorization to $400.0 million, which may include purchases from Cantor, its partners or employees or other affiliated persons or entities.

On November 4, 2022, the Board and Audit Committee increased the BGC Partners share repurchase and unit redemption authorization to $400.0 million, which may include purchases from Cantor, its partners or employees or other affiliated persons or entities.

As of December 31, 2022, the Company had $376.4 million remaining from its share repurchase and unit redemption authorization.

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The table below represents the units redeemed and/or shares repurchased for cash and does not include units redeemed/cancelled in connection with the grant of shares of BGC Class A common stock nor the limited partnership interests exchanged for shares of BGC Class A common stock.

The unit redemptions and share repurchases of BGC Class A common stock during the year ended December 31, 2021 were as follows (in thousands, except for weighted-average price data):

The gross unit redemptions and share repurchases of BGC Class A common stock during the year ended December 31, 2022 were as follows (in thousands, except for weighted-average price data):

Period Total Number

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or Share Approximate

Shares That May

Yet Be Redeemed/

Under the Program

Shares That Could Be Redeemed/

Under the Program at December 31, 2022

Redemptions 1

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July 1, 2022—September 30, 2022 12,397 4.03

October 1, 2021—December 31, 2021 26,313 4.97

October 1, 2022—October 31, 2022 307 3.93

November 1, 2022—November 30, 2022 3,834 3.99

December 1, 2022—December 31, 2022 1,804 4.48

Total Repurchases 27,087 3.84

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1 During the year ended December 31, 2022, the Company redeemed 1.3 million LPUs at an aggregate redemption price of $4.9 million for a weighted-average price of $3.87 per unit and 0.1 million FPUs at an aggregate redemption price of $0.4 million for a weighted-average price of $3.41 per unit.

The table above does not include units redeemed/cancelled in connection with the grant of 20.9 million shares of BGC Class A common stock during the year ended December 31, 2022, nor the limited partnership interests exchanged for 10.8 million shares of BGC Class A common stock during the year ended December 31, 2022.

2 During the year ended December 31, 2022, the Company repurchased 27.1 million shares of BGC Class A common stock at an aggregate price of $103.9 million for a weighted-average price of $3.84 per share.

The gross unit redemptions and share repurchases of BGC Class A common stock during the year ended December 31, 2021 were as follows (in thousands, except for weighted-average price data):

Period Total Number

Repurchased Weighted-

Average Price

Paid per Unit

or Share Approximate

Shares That Could Be Redeemed/

Under the Program at December 31,2021

Redemptions 1

January 1, 2021—March 31, 2021 20 $ 4.40

April 1, 2021—June 30, 2021 4,715 5.82

July 1, 2021—September 30, 2021 73 5.14

October 1, 2021—December 31, 2021 38 5.37

Total Redemptions 4,846 $ 5.80

Repurchases 2

January 1, 2021—March 31, 2021 965 $ 4.56

April 1, 2021—June 30, 2021 16,542 6.25

July 1, 2021—September 30, 2021 24,433 5.19

October 1, 2021—December 31, 2021 26,313 4.97

Total Repurchases 68,253 5.35

Total Redemptions and Repurchases 73,099 $ 5.38 $ 191,809

____________________________________

1 During the year ended December 31, 2021, the Company redeemed 4.7 million LPUs at an aggregate redemption price of $27.5 million for a weighted-average price of $5.83 per unit and 0.1 million FPUs at an aggregate redemption price of $0.6 million for a weighted-average price of $4.86 per unit.

The table above does not include units redeemed/cancelled in connection with the grant of 27.5 million shares and 9.5 million shares of BGC Class A common stock during the years ended December 31, 2021 and 2020, respectively, nor the limited partnership interests exchanged for 32.2 million and 3.7 million shares of BGC Class A common stock during the years ended December 31, 2021 and 2020, respectively.

The table above does not include units redeemed/cancelled in connection with the grant of 27.5 million shares of BGC Class A common stock during the year ended December 31, 2021, nor the limited partnership interests exchanged for 32.2 million shares of BGC Class A common stock during the year ended December 31, 2021.

2 During the year ended December 31, 2021, the Company repurchased 68.3 million shares of BGC Class A common stock at an aggregate price of $365.4 million for a weighted-average price of $5.35 per share.

During the year ended December 31, 2020, the Company repurchased 2 thousand shares of BGC Class A common stock at an aggregate price of $6 thousand for a weighted-average price of $2.58 per share.

The weighted-average share counts, including securities that were anti-dilutive for our earnings per share calculations, for the three months and year ended December 31, 2022 were as follows (in thousands):

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1 Common stock consisted of shares of BGC Class A common stock, shares of BGC Class B common stock and contingent shares of our Class A common stock for which all necessary conditions have been satisfied except for the passage of time.

For the quarter ended December 31, 2021, the weighted-average number shares of BGC Class A common stock was 324.6 million and Class B shares was 45.9 million.

For the year ended December 31, 2021, the weighted-average number shares of BGC Class A common stock was 333.3 million and Class B shares was 45.9 million.

For the quarter ended December 31, 2022, the weighted-average number of shares of BGC Class A common stock was 324.0 million and Class B shares was 45.9 million.

For the year ended December 31, 2022, the weighted-average number of shares of BGC Class A common stock was 324.3 million and Class B shares was 45.9 million.

2 Partnership units collectively include FPUs, LPUs, including contingent units of BGC Holdings for which all necessary conditions have been satisfied except for the passage of time, and Cantor units (see Note 2—“Limited Partnership Interests in BGC Holdings and Newmark Holdings” to our consolidated financial statements in Part II, Item 8 of this Annual Report on Form 10-K for more information).

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For the year ended December 31, 2022, approximately 0.5 million potentially dilutive securities were not included in the computation of fully diluted EPS because their effect would have been anti-dilutive.

Anti-dilutive securities for the year ended December 31, 2021 included, approximately 0.1 million RSUs.

Anti-dilutive securities for the year ended December 31, 2022 included, approximately

0.5 million RSUs.

As of December 31, 2022, approximately 50.2 million shares of contingent BGC Class A common stock, N units, RSUs, and LPUs were excluded from fully diluted EPS computations because the conditions for issuance had not been met by the end of the period.

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Following this exchange, Cantor and its affiliates only have the right to exchange under the Exchange Agreement up to an aggregate of 23.6 million shares of BGC Class A common stock, now owned or subsequently acquired, or its Cantor units in BGC Holdings, into shares of BGC Class B common stock.

As of December 31, 2021, Cantor and CFGM do not own any shares of BGC Class A common stock.

As of December 31, 2022, Cantor and CFGM did not own any shares of BGC Class A common stock.

We and Cantor have agreed that any shares of BGC Class B common stock issued in connection with the Exchange Agreement would be deducted from the aggregate number of shares of BGC Class B common stock that may be issued to the Cantor entities upon exchange of Cantor units in BGC Holdings.

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Registration Statements

We had in place an effective equity shelf registration statement on Form S-3 filed on March 9, 2018 with respect to the issuance and sale of up to an aggregate of $300.0 million of shares of BGC Class A common stock from time to time on a delayed or continuous basis (the "March 2018 Form S-3").

We previously had in place the March 2018 Form S-3 with respect to the issuance and sale of up to an aggregate of $300.0 million of shares of BGC Class A common stock from time to time on a delayed or continuous basis.

On March 9, 2018, we entered into the March 2018 Sales Agreement, pursuant to which we could offer and sell up to an aggregate of $300.0 million of shares of BGC Class A common stock under the CEO Program.

Proceeds from shares of BGC Class A common stock sold under this CEO Program Sales Agreement could be used for redemptions of limited partnership interests in BGC Holdings, as well as for general corporate purposes, including acquisitions and the repayment of debt.

CF&Co is a wholly owned subsidiary of Cantor and an affiliate of us.

Under this Sales Agreement, we have agreed to pay CF&Co 2% of the gross proceeds from the sale of shares.

For certain transactions during 2020, we paid CF&Co 1% of the gross proceeds from the sale of shares of our Class A common stock in our CEO program.

Under this Sales Agreement, we agreed to pay CF&Co 2% of the gross proceeds from the sale of shares.

The March 2018 Form S-3 and the March 2018 Sales Agreement expired in September 2021.

As of the date of expiration, we had sold 17.6 million shares of BGC Class A common stock (or $210.8 million) under the March 2018 Sales Agreement, and $89.2 million of stock remained unsold by us under the March 2018 Sales Agreement.

For additional information on the Company’s CEO Program sales agreements, see Note 14—“Related Party Transactions” to our consolidated financial statements in Part 8, Item II of this Annual Report on Form 10-K.

On March 8, 2021, we filed a replacement CEO Program shelf registration statement on Form S-3, which has not yet been declared effective, with respect to the issuance and sale of up to an aggregate of $300.0 million of shares of BGC Class A common stock from time to time on a delayed or continuous basis.

For additional information on our CEO Program sales agreements, see Note 13—“Related Party Transactions” to our Consolidated Financial Statements in Part 8, Item II of this Annual Report on Form 10-K.

On March 8, 2021, we filed the March 2021 Form S-3 with respect to the issuance and sale of up to an aggregate of $300.0 million of shares of BGC Class A common stock from time to time on a delayed or continuous basis.

On July 8, 2022, we filed an amendment to the March 2021 Form S-3.

On August 3, 2022, the March 2021 Form S-3 was declared effective by the SEC, and we entered into the August 2022 Sales Agreement on August 12, 2022.

We intend to use the net proceeds of any shares of BGC Class A common stock sold for general corporate purposes for potential acquisitions, redemptions of LPUs and FPUs in BGC Holdings and repurchases of shares of BGC Class A common stock from partners, executive officers and other employees of ours or our subsidiaries and of Cantor and its affiliates.

Certain of such partners will be expected to use the proceeds from such sales to repay outstanding loans issued by, or credit enhanced by, Cantor, or BGC Holdings.

In addition to general corporate purposes, these sales along with our share repurchase

authorization are designed as a planning device in order to facilitate the redemption process.

Going forward, we may redeem units and reduce our fully diluted share count under our repurchase authorization or later sell shares of BGC Class A common stock under the replacement CEO Program shelf registration statement on Form S-3, which has not yet been declared effective.

In addition to general corporate purposes, these sales along with our share repurchase authorization are designed as a planning device in order to facilitate the redemption process.

Going forward, we may redeem units and reduce our fully diluted share count under our repurchase authorization or later sell shares of BGC Class A common stock under the March 2021 Form S-3.

Further, we have an effective registration statement on Form S-4 filed on September 3, 2010, with respect to the offer and sale of up to 20 million shares of BGC Class A common stock from time to time in connection with business combination transactions, including acquisitions of other businesses, assets, properties or securities.

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The Compensation Committee may grant stock options, stock appreciation rights, deferred stock such as RSUs, bonus stock, performance awards, dividend equivalents and other equity-based awards, including to provide exchange rights for shares of BGC Class A common stock upon exchange of LPUs.

On November 22, 2021, at our Annual Meeting of Stockholders, our stockholders approved our Equity Plan to increase from 400 million to 500 million the aggregate number of shares of BGC Class A common stock that may be delivered or cash-settled pursuant to awards granted during the life of the Equity Plan, subject to adjustment, and to remove the annual per-participant limit of 15 million awards that may be granted under the Plan.

On November 22, 2021, at our Annual Meeting of Stockholders, our stockholders approved amendments to our Equity Plan to increase from 400 million to 500 million the aggregate number of shares of BGC Class A common stock that may be delivered or cash-settled pursuant to awards granted during the life of the Equity Plan, subject to adjustment, and to remove the annual per-participant limit of 15 million awards that may be granted under the Plan.

As of December 31, 2022, the limit on the aggregate number of shares authorized to be delivered allowed for the grant of future awards relating to 128.0 million shares of BGC Class A common stock.

On October 20, 2020, we filed a registration statement on Form S-3, which was declared effective on October 28, 2020, pursuant to which CF&Co may make offers and sales of our 5.125% Senior Notes, 5.375% Senior Notes, 3.750% Senior Notes and 4.375% Senior Notes in connection with ongoing market-making transactions which may occur from time to time.

Such market-making transactions in these securities may occur in the open market or may be privately negotiated at prevailing market prices at a time of resale or at related or negotiated prices.

Neither CF&Co, nor any other of our affiliates, has any obligation to make a market in our securities, and CF&Co or any such other affiliate may discontinue market-making activities at any time without notice.

CONTINGENT PAYMENTS RELATED TO ACQUISITIONS

Since 2016, the Company has completed acquisitions whose purchase price included an aggregate of approximately 2.2 million shares of the Company’s Class A common stock (with an acquisition date fair value of approximately $9.2 million), 0.1 million LPUs (with an acquisition date fair value of approximately $0.2 million), 0.2 million RSUs (with an acquisition date fair value of approximately $1.2 million) and $37.5 million in cash that may be issued contingent on certain targets being met through 2023.

As of December 31, 2021, the Company has issued 0.5 million shares of BGC Class A common stock, 0.2 million of RSUs, and paid $30.4 million in cash related to such contingent payments.

Since 2016, the Company has completed acquisitions whose purchase price included an aggregate of approximately 2.2 million shares of the BGC Class A common stock (with an acquisition date fair value of approximately $9.2 million), 0.1 million LPUs (with an acquisition date fair value of approximately $0.2 million), 0.2 million RSUs (with an acquisition date fair value of approximately $1.2 million) and $37.5 million in cash that may be issued contingent on certain targets being met through 2023.

As of December 31, 2022, the Company has issued 1.0 million shares of BGC Class A common stock, 0.2 million RSUs, and paid $34.7 million in cash related to such contingent payments.

As of December 31, 2022, 1.3 million shares of BGC Class A common stock, 0.1 million RSUs, and $18.4 million in cash remain to be issued if the targets are met, net of forfeitures and other adjustments.

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A trial was held before Vice Chancellor Lori Will on October 11, 2021, which concluded on October 15, 2021.

The parties will submit post-trial briefing, after which the Court is expected to rule on all pending matters in or around the second quarter of 2022.

The Company continues to believe that the claims against the defendants are without merit and will continue to defend against them vigorously.

Following the close of the hearing, the parties submitted post-trial briefing, and presented oral argument on March 2, 2022.

On April 14, 2022, the Court requested limited additional briefing, which the parties submitted on May 13, 2022.

On August 19, 2022, the Court issued a post-trial memorandum opinion in favor of BGC, its directors, and controlling shareholders, ruling that the Transaction was entirely fair to BGC’s shareholders with respect to both process and price.

The Court found that “Berkeley Point was, by all accounts, a unique asset particularly appealing to BGC” and that the price negotiated by BGC’s Special Committee and agreed to by Cantor Fitzgerald was at the “lower end” of a range of reasonable

The Court further found the Special Committee was “independent, fully empowered, and well-functioning.” Final judgment in the case was entered for Defendants and against the Plaintiffs on September 27, 2022.

The same day, Plaintiffs filed a notice of appeal, seeking reversal of the memorandum opinion and final judgment.

The briefing of the appeal before the Delaware Supreme Court is now complete, with oral argument yet to be scheduled.

BGC believes that any appeal of the Court's final judgement would be without merit, and will continue to defend the case vigorously.

However, as in any litigated matter, the outcome cannot be determined with certainty.

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On March 31, 2021, Cantor purchased from BGC Holdings an aggregate of 1,149,684 Cantor units for aggregate consideration of $2,104,433 as a result of the redemption of 1,149,684 FPUs, and 1,618,376 Cantor units for aggregate consideration of $3,040,411 as a result of the exchange of 1,618,376 FPUs.

Each Cantor unit in BGC Holdings held by Cantor is exchangeable by Cantor at any time on a one-for-one basis (subject to adjustment) for shares of BGC Class A common stock.

On October 28, 2021, Cantor purchased from BGC Holdings an aggregate of 460,929 Cantor units for an aggregate consideration of $715,605 as a result of the redemption of 460,929 FPUs, and 1,179,942 Cantor units for aggregate consideration of $2,033,838 as a result of the exchange of 1,179,942 FPUs.

Each Cantor unit in BGC Holdings held by Cantor is exchangeable by Cantor at any time on a one-for-one basis (subject to adjustment) for shares of BGC Class A common stock.

As of December 31, 2021, there were no FPUs in BGC Holdings remaining, which BGC Holdings had the right to redeem or exchange and with respect to which Cantor will have the right to purchase an equivalent number of Cantor units following such redemption or exchange.

On May 17, 2022, Cantor purchased from BGC Holdings an aggregate 427,494 Cantor units for aggregate consideration of $841,010 as a result of the redemption of 427,494 FPUs, and 52,681 Cantor units for aggregate consideration of $105,867 as a result of the exchange of 52,681 FPUs.

On October 25, 2022, Cantor purchased from BGC Holdings an aggregate of 275,833 Cantor units for an aggregate consideration of $397,196 as a result of the redemption of 275,833 FPUs, and 77,507 Cantor units for aggregate consideration of $142,613 as a result of the exchange of 77,507 FPUs.

As of December 31, 2022, there were 0.3 million FPUs in BGC Holdings remaining, which BGC Holdings had the right to redeem or exchange and with respect to which Cantor will have the right to purchase an equivalent number of Cantor units following such redemption or exchange.

JOINT SERVICES AGREEMENT WITH CANTOR

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OpCo paid a fixed rent amount of $1.1 million in addition to all operating and tax expenses attributable to the lease.

In May 2021, the sublease was amended to provide for a rate of $15 thousand per month based on the size of utilized space, with terms extending on a month-to-month basis.

In May 2021, the sublease was amended to provide for a rate of $15 thousand per month based on the size of utilized space, with terms extending on a month-to-month basis, and expiring on December 31, 2021.

In connection with the sublease, BGC U.S.

OpCo paid $0.5 million and $0.8 million for the years ended December 31, 2021 and 2020, respectively.

OpCo paid $0.5 million for the year ended December 31, 2021.

DEBT REPURCHASE PROGRAM

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UNIT REDEMPTIONS AND EXCHANGES—EXECUTIVE OFFICERS

On March 14, 2022, the Compensation Committee approved the grant of exchange rights to Mr.

Windeatt with respect to 135,514 non-exchangeable BGC Holdings LPU-NEWs and 27,826 non-exchangeable PLPU-NEWs (at the average determination price of $4.84 per unit).

On August 11, 2022, the Company repurchased 135,514 exchangeable BGC Holdings LPU-NEWs held by Mr.

Windeatt at the price of $4.08 per unit, which was the closing price of the BGC Class A common stock on August 11, 2022, and redeemed 27,826 exchangeable PLPU-NEWs held by Mr.

Windeatt for $134,678, less applicable taxes and withholdings.

On February 22, 2021, the Company granted Sean A.

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On June 28, 2021, (i) the Company exchanged 520,380 exchangeable LPUs held by Mr.

Lutnick at the price of $5.86, which was the closing price of the Company's Class A common stock on June 28, 2021, for 520,380 shares of BGC Class A common stock, less applicable taxes and withholdings, resulting in the delivery of 365,229 net shares of BGC Class A common stock to Mr.

Lutnick at the price of $5.86, which was the closing price of the BGC Class A common stock on June 28, 2021, for 520,380 shares of BGC Class A common stock, less applicable taxes and withholdings, resulting in the delivery of 365,229 net shares of BGC Class A common stock to Mr.

Lutnick, and in connection with the exchange of these 520,380 exchangeable LPUs, 425,765 exchangeable PLPUs were redeemed for a cash payment of $1,525,705 towards taxes;

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The grant was approved by the Compensation Committee.

Additionally, the Compensation Committee approved the right to exchange for cash 97,656 non-

exchangeable PLPUs held by Mr.

Additionally, the Compensation Committee approved the right to exchange for cash 97,656 non-exchangeable PLPUs held by Mr.

Windeatt, for a payment of $645,779 for taxes when the LPU units are exchanged.

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In connection with the redemption of the 436,665 exchangeable LPUs, 96,216 exchangeable PLPUs were redeemed for $637,866 for taxes.

In connection with the redemption, 20,849 exchangeable LPUs and 1,440 exchangeable PLPUs were redeemed for zero upon exchange in connection with Mr.

connection with the redemption, 20,849 exchangeable LPUs and 1,440 exchangeable PLPUs were redeemed for zero upon exchange in connection with Mr.

Windeatt’s LLP status.

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Windeatt’s LLP status.

On March 27, 2019, the Audit and Compensation Committees authorized the purchase by the Company from Mr.

Merkel of up to 250,000 shares of BGC Class A common stock at the closing price on March 26, 2019.

Pursuant to this authorization, 233,172 shares of BGC Class A common stock were purchased by the Company on March 27, 2019 at $5.30 per share, the closing price on March 26, 2019.

On February 27, 2019, the Audit Committee authorized the purchase by Mr.

Lutnick’s retirement plan of up to $56,038 of BGC Class A common stock at the closing price on March 4, 2019.

Pursuant to this authorization, 8,980 shares of BGC Class A common stock were purchased by the plan on March 5, 2019 at $6.24 per share, the closing price on March 4, 2019.

MARKET SUMMARY

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Total Hybrid volume 58,022 65,404 63,558 59,920 61,847

61,846 62,859 62,345 68,113 59,165

Total Fully Electronic and Hybrid volume $ 68,618 $ 75,875 $ 73,774 $ 71,947 $ 71,720

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Such revisions have no impact on the Company’s revenues or earnings.

1 Hybrid is defined as transactions involving some element of electronic trading but executed by BGC’s brokers, exclusive of voice-only transactions.

Fully electronic involves customer-to-customer trades, free from broker execution.

Fully Electronic volume, including new products, was $43.3 trillion for the year ended December 31, 2022, compared to $38.1 trillion for the year ended December 31, 2021.

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1 Year 1-3 Years 3-5 Years More Than

Long-term debt and collateralized borrowings 1

Debt and collateralized borrowings 1

$ 1,053,251 $ 453,251 $ 600,000 $ — $ —

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221,363 35,483 57,145 39,517 89,218

Interest on long-term debt and collateralized borrowings 3

Finance leases 2

6,615 1,802 2,896 1,917 —

Interest on debt and collateralized borrowings 3

73,877 38,980 34,897 — —

Short-term borrowings 4

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_________________________________

1 Long-term debt and collateralized borrowings reflects long-term borrowings of $450.0 million of the 5.375% Senior Notes (the $450.0 million represents the principal amount of the debt;

the carrying value of the 5.375% Senior Notes as of December 31, 2021 was $447.9 million), $300.0 million of the 3.750% Senior Notes (the $300.0 million represents the principal amount of the debt;

the carrying value of the 3.750% Senior Notes as of December 31, 2021 was approximately $297.7 million), $300.0 million of the 4.375% Senior Notes (the $300.0 million represents the principal amount of the debt;

1 Debt and collateralized borrowings reflects $450.0 million of 5.375% Senior Notes (the $450.0 million represents the principal amount of the debt;

the carrying value of the 5.375% Senior Notes as of December 31, 2022 was $449.2 million), $300.0 million of 3.750% Senior Notes (the $300.0 million represents the principal amount of the debt;

the carrying value of the 3.750% Senior Notes as of December 31, 2022 was approximately $298.6 million), $300.0 million of 4.375% Senior Notes (the $300.0 million represents the principal amount of the debt;

the carrying value of the 4.375% Senior Notes as of December 31, 2022 was approximately $298.2 million), $2.0 million of collateralized borrowings due April 8, 2023, and $1.3 million of collateralized borrowings due April 19, 2023.

See Note 18—“Notes Payable, Other and Short-term Borrowings” for more information regarding these obligations, including timing of payments and compliance with debt covenants.

2 Operating leases are related to rental payments under various non-cancelable leases, principally for office space, net of sublease payments to be received.

There are no sublease payments to be received over the life of the agreement.

3 Interest on long-term debt and collateralized borrowings also includes interest on the undrawn portion of the committed unsecured senior Revolving Credit Agreement which was calculated through the maturity date of the facility, which is February 26, 2023.

See Note 17—“Notes Payable, Other and Short-term Borrowings” in Part II, Item 8 of this Annual Report on Form 10K for more information regarding these obligations, including timing of payments and compliance with debt covenants.

2 Operating leases and finance leases are related to rental payments under various non-cancelable leases, principally for office space, data centers and office equipment are presented net of sublease payments to be received.

As of December 31, 2022, there were no sublease payments to be received over the life of the agreements.

3 Interest on debt and collateralized borrowings also includes interest on the undrawn portion of the committed unsecured senior Revolving Credit Agreement which was calculated through the maturity date of the facility, which is March 10, 2025.

As of December 31, 2022, the undrawn portion of the committed unsecured Revolving Credit Agreement was $375.0 million.

4 Short-term borrowings reflects approximately $3.6 million (BRL 20.0 million) of borrowing under the Company’s committed unsecured loan agreement.

See Note 18—“Notes Payable, Other and Short-term Borrowings” for more information regarding this obligation.

4 Short-term borrowings reflect approximately $1.9 million (BRL 20.0 million) of borrowing under the Company’s committed unsecured loan agreement.

See Note 17—“Notes Payable, Other and Short-term Borrowings” in Part II, Item 8 of this Annual Report on Form 10K for more information regarding this obligation.

5 The Company completed the calculation of the one-time transition tax on the deemed repatriation of foreign subsidiaries’ earnings pursuant to the Tax Act and previously recorded a net cumulative tax expense of $28.6 million, net of foreign tax credits, with an election to pay the taxes over eight years with 40% to be paid in equal installments over the first five years and the remaining 60% to be paid in installments of 15%, 20% and 25% in years six, seven and eight, respectively.

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The preparation of our Consolidated Financial Statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in our consolidated financial statements.

GAAP requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities, revenues and expenses, and the

disclosure of contingent assets and liabilities in our Consolidated Financial Statements.

These accounting estimates require the use of assumptions about matters, some of which are highly uncertain at the time of estimation.

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Restricted Stock Units:

We account for equity-based compensation under the fair value recognition provisions of the U.S.

GAAP guidance.

We account for equity-based compensation awards using the guidance in ASC 718, Compensation - Stock Compensation .

RSUs provided to certain employees are accounted for as equity awards, and in accordance with the U.S.

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This is an acceptable alternative to the common practice among public companies of issuing the gross amount of shares to employees, subject to cashless withholding of shares to pay applicable withholding taxes.

Our Preferred Units are not entitled to participate in partnership distributions other than with respect to a distribution at a rate of either 0.6875% (which is 2.75% per calendar year)

or such other amount as set forth in the award documentation.

Our Preferred Units are not entitled to participate in partnership distributions other than with respect to a distribution at a rate of either 0.6875% (which is 2.75% per calendar year) or such other amount as set forth in the award documentation.

The quarterly allocations of net income to such LPUs are reflected as a component of compensation expense under “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in our Consolidated Statements of Operations.

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These LPUs are accounted for as post-termination liability awards under the U.S.

Accordingly, we recognize a liability for these units on our consolidated statements of financial condition as part of “Accrued compensation” for the amortized portion of the post-termination payment amount, based on the current fair value of the expected future cash payout.

Accordingly, we recognize a liability for these units on our Consolidated Statements of Financial Condition as part of “Accrued compensation” for the amortized portion of the post-termination payment amount, based on the

current fair value of the expected future cash payout.

We amortize the post-termination payment amount, less an expected forfeiture rate, over the vesting period, and record an expense for such awards based on the change in value at each reporting period in our Consolidated Statements of Operations as part of “Equity-based compensation and allocations of net income to limited partnership units and FPUs.”

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The quantitative goodwill impairment test, used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill.

If the carrying

amount of a reporting unit exceeds its fair value, an impairment loss should be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.

If the carrying amount of a reporting unit exceeds its fair value, an impairment loss should be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.

If the estimated fair value of a reporting unit exceeds its carrying value, goodwill is deemed not to be impaired.

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These assumptions include cash flow projections, estimated cost of capital and the selection of peer companies and relevant multiples.

Because assumptions and estimates are used in projecting future cash flows, choosing peer companies and selecting relevant multiples, actual results may differ from our estimates under different assumptions or conditions;

Because assumptions and estimates are used in projecting future cash flows, choosing peer companies and selecting relevant multiples, actual results may differ from our estimates under different

assumptions or conditions;

and changes to these estimates and assumptions, as a result of changing economic and competitive conditions, could materially affect the determination of fair value and/or impairment.

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Expected credit losses for newly recognized financial assets carried at amortized cost, as well as changes to expected lifetime credit losses during the period, are recognized in earnings.

The CECL methodology became effective for the Company on January 1, 2020, due to the adoption of the new FASB guidance on credit losses.

The methodology’s impact on expected credit losses, among other things, reflects the Company’s view of the current state of the economy, forecasted macroeconomic conditions and BGC’s portfolios.

In accordance with the U.S.

GAAP guidance, Financial Instruments—Credit Losses , the CECL methodology’s impact on expected credit losses, among other things, reflects the Company’s view of the current state of the economy, forecasted macroeconomic conditions and BGC’s portfolios.

The amount of the allowance is based on significant estimates and the ultimate losses may vary from such estimates as more information becomes available or conditions change.

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Because our interpretation of complex tax law may impact the measurement of current and deferred income taxes, actual results may differ from these estimates under different assumptions regarding the application of tax law.

The Tax Act was enacted on December 22, 2017, which includes the global intangible low-taxed income, GILTI, provision.

The Tax Act includes the global intangible low-taxed income, GILTI, provision.

This provision requires inclusion in the Company’s U.S.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis