FX week in review: IG goes offshore, IC Markets sues Inter
FX industry news at FNG this week had a very international feel to it, with issues touching virtually every continent on the globe.
Where did online trading industry leader IG Group choose as an offshore home base? And why?
Why is Australian Retail FX broker IC Markets suing Italian soccer club Inter Milan?
Who is the latest Saxo Bank alum to join Lars Holst’s regulated crypto exchange GCEX?
How did Q3 financial and operating results look like from Plus500 and XTB.com? And how did the market react?
Where in Africa did Pepperstone receive a new license?
Which FXCM veteran is now Skilling’s new CEO?
Answers to these questions and a whole lot more appeared on the pages on FNG this past week. Some of the top forex industry news items to appear on FNG this week included:
Exclusive: IG Group sets up offshore entity in Bermuda. FNG Exclusive… FNG has learned that industry leading online broker IG Group has set up an offshore entity, in Bermuda. The new entity, aptly named IG International Limited, received a license from the Bermuda Monetary Authority (BMA) earlier this year and has already been operating for several months. It will focus on accepting ”rest of world” clients for IG – that is, clients from jurisdictions and countries where IG does not have an existing licensed operation. That would include areas such as Central and South America, and certain regions in Africa and the Far East. The BMA license is a “Class F” license, allowing IG International to operate as a digital asset derivative exchange provider.
Exclusive: IC Markets suing Inter Milan after sponsorship deal cancelled. FNG Exclusive… FNG has learned that Australia based Retail FX broker IC Markets has launched a lawsuit against Italian Serie A football club Inter Milan, after Inter cancelled IC’s planned sponsorship of the club. The IC Markets-Inter Milan sponsorship deal, signed in June of this year and reported exclusively at FNG (with an update on terms of the transaction also reported exclusively at FNG later in the summer), was to make IC Markets the “sleeve sponsor” of Inter Milan over a three-year period starting with the current 2020-21 season. The deal was going to see IC Markets paying €4.5 million in year one, €4.8 million in year two, and €5.0 million – totaling €14.3 million. There may have been additional bonus payments to be made to Inter, depending upon team results over the course of the sponsorship.
Plus500 continues “monster” 2020 with Q3 Revenues of $216 million. Retail FX and CFDs broker Plus500 issued a Trading Update (see full text below) for Q3-2020, with the company continuing to perform strongly across all areas. On the top line, Plus500 brought in $216.4 million of Revenue in Q3 – down 12.6% from Q2, but still very strong and almost double last year’s Q3 result of $110 million. Importantly, the company continued on the strong momentum it saw during the first half of the year through the usually-slow summer months, and capitalized on record new-client signups Plus500 enjoyed during Q1 and Q2. EBITDA in Q3 was $134.2 million, again almost double Q3-2019’s $70 million.
XTB.com sees 34% Revenue decline in Q3 2020. Poland based Retail FX and CFDs brokerage house X Trade Brokers Dom Maklerski SA – operator of the XTB.com and X Open Hub brands – has released preliminary financial results for the third quarter of 2020, showing that activity slowed significantly from the first half of the year. In a rare weekend earnings update, XTB.com indicated that Revenues came in at PLN 139.6 million (USD $36 million), down 34% from PLN 211 million in Q2 – which itself was down 31% from Q1’s PLN 306 million. Q1’s record revenue of course was helped by the heightened volatility in the currency and equity markets at the outset of the COVID-19 crisis. At most brokers we have seen a decline in trading volumes and resulting revenues since Q1, but not nearly as sharp as at XTB, with Q3 down 54% from Q1.
Pepperstone enters Kenyan retail Forex market. Australia-based retail forex and CFDs broker Pepperstone continues its global expansion by entering the Kenyan FX market. Pepperstone Markets Kenya Ltd, a subsidiary of Pepperstone Group Ltd, has now been granted a non-dealing Foreign Exchange Broker License by the Capital Markets Authority of Kenya. To head the operation, Pepperstone tapped Standard Bank and Barclays alum Sahil Patel. Mr. Patel joined the company last year to help set up the business and secure the CMA license. The launch, which coincides with Pepperstone’s 10th year of operations, is part of a global growth strategy that enables more effective and specific servicing of the fintech’s clients.
FX industry executive moves reported this week at FNG include:
❑ Exclusive: GCEX hires Saxo and IBKR alum Theo Papathanasiou.
❑ Skilling hires FXCM vet Michael Kamerman as CEO.
❑ Jim Newman to retire as Non-Exec Director of IG Group.
❑ Former Citi Fintech CPO Carey O’Connor Kolaja becomes CEO of AU10TIX.
❑ IG Group opens Amsterdam office headed by Nazli Visne.