London Stock Exchange marks growth in FX revenues in Q1 2022
London Stock Exchange Group plc today provided a trading update for the first quarter of 2022.
For the three months ended 31 March 2022, Capital Markets revenues were up 11.9%.
Revenues from equities grew 10.0% thanks to robust secondary market activity in Q1, reflecting the value customers place on the breadth and depth of LSEG’s liquidity, especially during periods of heightened volatility. This more than offsets the impact of weaker primary market issuance and suspension of securities impacted by the Ukraine/Russia (U/R) conflict.
FX revenues were up 2.4%, with strong growth in LSEG’s global dealer-to-client FX platform, FXall, reflecting investment in customer service and platform functionality. Performance was partially offset by weaker volumes on Matching platform, LSEG’s dealer-to-dealer FX trading venue.
LSEG says it continues to make good progress towards transitioning Matching to its modern, proprietary trading architecture in 2023.
Post Trade reported total income rise of 6.6%.
OTC Derivatives revenues were up 7.5%, with strong volumes seen across SwapClear, ForexClear, CDSClear and SwapAgent, as LSEG supports OTC market participants’ need for robust risk management and capital optimisation.
Revenues from Securities & Reporting grew 5.1%, with good volume growth at RepoClear and EquityClear as they continue to provide an essential service through volatile markets and the introduction of Central Securities Depository Regulation (CSDR).
Group Income (excluding recoveries) grew 6.3% at constant currency and was up 6.8% adjusting for the actions LSEG has taken in response to the Ukraine and Russia (U/R) conflict. The revenue impact of U/R is anticipated to be about £60 million in 2022. Most of the impact reflects the suspension of Data & Analytics services to customers in Russia, with the largest impact in Trading & Banking.
David Schwimmer, CEO said:
“LSEG has delivered a good first quarter, with strong underlying performance across all divisions. During the quarter we announced two acquisitions to enhance our product offerings in Trading & Banking and Customer & Third-Party Risk. We also announced the divestment of BETA+, which will simplify and refocus our Wealth Solutions business.
“Our ability to invest for growth, make strategic acquisitions and return capital to shareholders demonstrates the strength of the Group and its high-quality recurring revenues. The Group is well positioned and we look forward to further progress during the rest of 2022.”