Saxo Bank Reports Drop in Profits in 2019, Provides Liquidity to Vendors Amid Covid-19

Ricardo Esteves

Ricardo Esteves has seen business and economics through many lenses. He joined the Financial Services Industry in 2009, and has been a financial journalist since 2011. He holds a degree in Business Administration and has experience producing real-time news, from both buy-side and sell-side, as well as for retail traders, brokers and service providers. Esteves' work has appeared in a variety of online publications including FX Street and FinanceFeeds.

Saxo Bank

Saxo Bank Reports Drop in Profits in 2019, Provides Liquidity to Vendors Amid Covid-19

April 3, 2020

Saxo BankSaxo Bank - Drop in Profits Group has reported a net profit of DKK 40 million for 2019 compared to DKK 963 million for 2018 which proves drop in profits in 2019, in spite of a record number of new clients in 2019 and have a significant increase in client assets to more than DKK 375 billion.

This extraordinary drop in profit follows continued lower activity and higher investments. The unsatisfactory result for 2019 comes amid difficult market conditions during the year, with all-time low volatility across most financial markets and continued negative interest rates in many markets. Significant price reductions across asset classes as well as continued record-high level of investments in better platforms, products and digital services for clients and partners, have also impacted net profits negatively.

Saxo Bank acquired BinckBank to the Group, adding both many skilled and dedicated employees and a substantial number of clients and clients’ assets. The process of integrating BinckBank into the Saxo Group and technology infrastructure is underway. The firm has also set up a joint venture with shareholder Geely, to provide technology solutions to financial institutions such as banks and fintechs in the mainland Chinese market.

“We therefore have a very strong and unique position to continue to grow in our key markets and providing a world-class Saxo Experience to both new and existing clients”, said Saxo Bank founder and CEO Kim Fournais in an official statement. “We remain committed to our strategy and continue our investments in technology and digitalization, while at the same time pursuing strong cost discipline.”

Saxo Bank reported operating income of DKK 2,611 million (DKK 2,789 million), EBITDA (operating profit) of DKK 882 million (DKK 1,408 million), net profit of DKK 40 million (DKK 963 million), total equity of DKK 7.1 billion (DKK 5.6 billion), total clients’ assets of DKK 375.5 billion (DKK 112.6 billion), and total number of clients of 525,000 (178,439).

Regarding the Coronavirus crisis, Saxo Bank decided to help and support vendors with liquidity by moving forward payments. “In the beginning of 2020, volatility in financial markets has increased leading to higher activity among our clients and partners. We present our annual result for 2019 at a difficult time for the global community and the global economy. The Coronavirus continues to spread, significantly impacting the societies Saxo Bank is a part of. We naturally remain fully operational and we are taking every step necessary to continue to serve our clients and keep our employees healthy and safe.

“Furthermore, we have decided to move forward payment to our vendors to help and support with liquidity in this difficult situation. Saxo Bank has a healthy capital and liquidity position, giving us the flexibility to support the societies we are a part of. We all depend on each other and we need to come together to do everything in our power to ensure we get through this defining moment in our shared history”, said Kim Fournais.

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