IG GROUP Archives - The Industry Spread

IG Group Suffers Revenue Declines by 6% Y-o-Y in the H1-FY 19 on Account of Strict ESMA Regulations

December 5, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: brokerage, ESMA regulations, financial results, IG GROUP, Retail Foreign Exchange Dealer, trading services

IG Group, the UK trading major has reported the financial results of the first half of fiscal 2019. IG Group Holdings (LON: IGG) has reported a 6 per cent year-on-year revenue decline due to strict ESMA regulations. The drop in revenue and profitability comes after the record-setting fiscal 2018.

In the wake of new European regulatory measures limiting leverage for retail class traders, the brokerage has reported 10 per cent year-on-year decline in global revenue for the four months between August and November.

Regional wise, the revenue in the four month period in the UK and EU region is projected to be 20 per cent lower while APAC and non-ESMA region countries expecting a 9 per cent higher revenue, thus offsetting the impact of ESMA regulations. The figures mentioned are adjusted for the 1200 clients who previously contracted with the UK entity and have chosen to move outside of the ESMA regulation.

In a statement, IG Group said:

“The number of clients in the UK and EU who have elected to be classified as professional continued to increase during the period. Around 70% of UK and EU revenue in the four months since all the measures were introduced has been generated by professional clients.”

During the first half, new clients from APAC and non-ESMA regions have remained constant with very little variation compared to the last year which is 6,400 vs 6,361 last year. In the ESMA regulated region, only 8,200 new clients signed up which 20 per cent lower from 11,666 clients added last year in the same period.

For the Brexit event, the company has secured BaFin license in Germany which will help to continue offering its services in the EU. IG Group is now also planning its expansion to offer trading services in the USA, where its subsidiary has also been approved as the member of National Futures Association (NFA) and is now registered to operate as a Retail Foreign Exchange Dealer (RFED).

The next performance announcement from IG Group will be the financial results for the six months ended 30 November 2018 on 22 January 2019.

Jefferies Appoints Fred Jallot to Lead European Fixed Income Division and IG Group Promotes Kevin Algeo to Head of Asia Pacific and Africa Division

November 20, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: brokerage, emerging markets, fixed income, Fred Jallot, Fred Orlan, IG GROUP, Investment banking, Jefferies, Kevin Algeo, Retail Fx

Fred Orlan, Global Head of Fixed Income at Jefferies

Jefferies Appoints Former Nomura Executive Fred Jallot as Head of European Fixed Income Division

American multinational investment banking company, Jefferies Group has confirmed that former Nomura global head of emerging markets for Europe, the Middle East and Africa, Fred Jallot, is joining the firm.

Fred Jallot will be heading the firm’s European fixed income in London and start his role with Jefferies on January 2, 2019. He will be reporting to Fred Orlan, the Global Head of Fixed Income at Jefferies, in New York.

Fred Jallot’s professional career spans over two decades in the financial industry and has managed several senior level management roles. He joined Nomura in 2017 but left the organisation in mid of 2018. Before working for Nomura, he had worked with Citi where was responsible for Global Securitised Markets and Global Credit Markets.

Fred Orlan, commenting on the appointment:

“We are very excited to have Fred Jallot join Jefferies’ leading global fixed income platform. As a broadly experienced professional in global fixed income, his relationships and leadership will further enhance Jefferies’ growth in this market.”

“This senior hire is an example of Jefferies’ emphasis on enhancing our firm’s European capabilities to serve our regional and global client base.”

Kevin Algeo, IG Group Head of Asia Pacific and Africa operations

IG Group Promotes Kevin Algeo to Head of Asia Pacific and Africa operations

The UK-based online retail fx brokerage company, IG Group has promoted Kevin Algeo, CEO of Australia operations as Head of the Asia Pacific and Africa. Kevin is associated with IG Group since 2013 and has started his tenure as Managing Director in South Africa. Kevin spent almost four years in the position before moving to lead the Australia operations.

In Australia, Kevin Algeo started as Deputy CEO in Melbourne and was promoted to CEO in June last year. IG Group has been handling clients support system across the globe via different regional entities. IG’s London office is used to be the home for global users in most of the cases.

IG Group Appoints June Felix as its New CEO and Executive Director of the Board with Immediate Effect

October 30, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: Andy Green, derivatives, financial services, IG GROUP, June Felix, Peter Hetherington, Russell Reynolds, spread betting

The UK-based provider of online trading in derivatives, CFD and spread betting firm, IG Group has announced the appointment of June Felix as Chief Executive Officer (CEO) of the Group and Executive Director on the Board of IG with immediate effect.

June Felix is replacing Peter Hetherington as CEO who stepped down from the position last month. The appointment was following extensive search and succession planning process that included both external and internal candidates supported by Russell Reynolds and Korn Ferry. June Felix is not new to IG Group as she has served as a non-executive director of the Group since 2015.

June Felix joins IG Group from Verifone, where she was the President of Europe and Russia division until its recent sale. As a president, she was responsible for the operation of the business throughout these territories. Prior to her role in Verifone, she has held various senior executive roles at a large number of MNCs that include Citi, IBM and other leading financial institutes

At Citibank, she was Managing Director of Global Healthcare Citi Enterprise Payments, Global General Manager for the Global Banking and Financial Markets at IBM Corporation. She has also held strategic roles at Booz, Allen & Hamilton, Chase Manhattan Bank and as CEO of Certco.

Andy Green, Chairman of IG, said:

Andy Green, IG’s Chairman

“The Board is delighted to appoint June Felix as CEO of the Group. She brings to the role over 25 years’ experience in both the finance and digital technology sectors, and she has a deep understanding of our business.”

“June has a strong track record in strategy and product innovation and has successfully developed businesses of varying scales in the USA, Asia and Europe. Her broad experience makes her ideally suited to take IG forward.”

June Felix commented:

“I am honored to be asked to lead a business with such tremendous people and technology and with such a strong client-centric culture. The Group’s business is well positioned to continue to successfully navigate the impact of regulatory change and I am excited about working closely with the highly experienced executive team at IG in the continued delivery of that programme.”

“Drawing on my experience of financial services firms globally, I look forward to leading the evolution of the Group’s strategy to deliver sustainable growth and attractive shareholder returns.”

OANDA Appoints Former IG Group CEO As Chairman of the Board

October 29, 2018 by Ricardo Esteves Leave a Comment Filed Under: Industry News Tagged: CFD industry, CVC Capital Partners, FX, FX trading, IG GROUP, OANDA, OANDA Appoints, Tim Howkins, Vatsa Narasimha, Warren Faleiro

Tim Howkins, Chairman, Board of Directors at Oanda

OANDA has appointed industry veteran Tim Howkins as Chairman to its Board of Directors. The appointment follows the successful completion of CVC Capital Partners’ acquisition of OANDA, which was completed on 15 October 2018.

Tim Howkins is likely to add a wealth of industry-specific expertise to OANDA’s advisory team, having worked with entrepreneurial high-growth businesses for close to 35 years.

Best known for his 16-year career with IG Group, Tim Howkins initially joined the firm as CFO before assuming the role of CEO, which he played for nine years. There, he steered the business through an unprecedented period of global transformation, driving significant growth in shareholder value and quadrupling earnings per share.

Tim Howkins, Chairman of the Board of Directors at OANDA, commented:

“I am delighted to be joining OANDA at such an exciting time in the company’s 22-year history. Throughout my career in the FX and CFD industry, I have long admired OANDA as one of the most ethical firms in the industry, with a proven track record in treating clients fairly and placing their interests first. I am excited at the prospect of helping OANDA grow to be one of the largest global firms in the sector.”

Vatsa Narasimha, Chief Executive Officer of OANDA, added:

Vatsa Narasimha, President and Chief Executive Officer, OANDA Corporation

“We are extremely pleased to welcome Tim to the OANDA Board. A seasoned professional, his in-depth knowledge and unparalleled expertise in the market will be a tremendous asset to the firm as we look for new growth opportunities in the future.”

CVC Capital Partners, a leading private equity and investment advisory firm founded in 1981, completed the acquisition of OANDA on 15 October 2018. CVC Capital Partners (“CVC”) founded in 1981, CVC today has a network of 23 offices and approximately 450 employees throughout Asia, Europe and the U.S. In total, CVC currently manages circa $70 billion of assets.

OANDA was the first company to share exchange rate data free of charge on the Internet, launching an FX trading platform that helped pioneer the development of web-based currency trading five years later. In April, the broker appointed a new Chief Technology Officer, Warren Faleiro. The company’s operation in Europe reported increased profitability for the year ending December 31st, 2017.

IG Group Receives Regulatory Approval from National Futures Association for US Operations

October 16, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: CMC Markets, Futures Dealer, Head of Trading Services, IG GROUP, Matthew Macklin, National Futures Association, NFA, regulatory approval, Rupert Osborne

IG Group’s dream of opening a US subsidiary got a major boost this Tuesday after it received regulatory approval from the National Futures Association (NFA), a self-regulatory organisation that governs the American derivative market.

With Today’s approval from NFA, IG Group has received all regulatory approvals it applied for in last October. IG Group was signalling about opening up of US office over the past 12 months and now it is estimated that it would open in the middle of 2019 fiscal, that means in the next couple of months.

According to NFA’s release and IG has also previously announced, the US office will be located in Chicago on W Jackson Boulevard in the heart of the Windy City’s financial district. IG is working on to build its US team for some time now and has made all the hires it needs for US operation. At the senior management level, the US CEO positions will be handled by Rupert Osborne, formerly IG’s Deputy Head of FX and Futures.

Matthew Macklin, IG Group Head of UK operations

IG Appoints Matthew Macklin as the firm’s Head of UK Operations

IG has also made an important hire in the UK region by appointing Matthew Macklin as the firm’s Head of UK operations. The information made public through his LinkedIn profile. Macklin has stepped down as Head of Europe from CMC Markets back in August where he was working since 2012.

Matthew Macklin’s return to IG Group marks the end of speculation about his next stint since he left CMC. Macklin started his career with IG in 2004, and worked for almost eight years, His first position at IG was as a Futures Dealer and in 2010, he was promoted to the Group Head of Sales Trading and again promoted after a period of one year as Group Head of Trading Services.

Peter Hetherington Resigns As CEO of IG Group

September 29, 2018 by Ricardo Esteves Leave a Comment Filed Under: Industry News Tagged: Andy Green, CFD broker, ESMA regulation, IG GROUP, Peter Hetherington, product innovation, Special Advisor

Peter Hetherington, Chief Executive Officer of IG Group Holdings, is stepping down both from his management role and the Board, effective immediately. The company made the announcement as the search for a new CEO is “well advanced”.

Hetherington, however, will continue in IG’s employment and will help with the transition to his successor until the end of the financial year. Over his 3-year tenure as CEO, IG’s PBT and EPS were up by more than 65%. He now holds the title of Special Advisor at IG Group.

Peter Hetherington commented: “When I joined IG in 1994 the Company employed fewer than 25 people and had revenues of £16 million and profits before tax of £0.8 million. There are today over 1,700 people working in 15 countries with revenues of over £550 million and profits before tax of over £280 million.”

Hetherington works at the organization for over 24 years, having joined as a graduate trainee in January 1994. He became the CEO in late 2015 and led the company through a period of significant regulatory uncertainty. The UK-based CFD broker was a leader in the opposition to the recent ESMA regulation, having even created the website replytoesma.trading as a response.

Andy Green, IG’s Chairman, said: “I would like to extend our sincere thanks to Peter for his tremendous contribution to the Group. Peter has been pivotal to the success of IG during his many years of service, particularly during the last three years during which he has successfully steered the Company through an unprecedented period of regulatory uncertainty whilst delivering strong earnings and profits growth. I particularly commend Peter for his strong ethical leadership of IG and his management of its recent performance. The Company will continue to focus on the delivery of its immediate priorities that Peter has set which the Board believes are successfully positioning IG for its next stage of development.”

Andy Green, IG’s Chairman

“Finally, I would like to thank all of IG’s employees, past and present, for their friendship, hard work and dedication which has make the last 24 years such an enjoyable and rewarding experience. I would also like to thank our hundreds of thousands of clients from all over the world who have put their trust in IG over the years. To our many loyal shareholders, I want to thank them for the faith they show in the Company”, Hetherington added.

The Board will now search for a CEO with wide global experience of the broader financial sector who can develop the business using its platform, geographic presence and product innovation as a base.

IG Group Reports 5% Decline in Revenue in Q1-FY19 as Impact of Regulatory Crackdown Felt

September 20, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: binary options, CFD brokerage, derivatives trading, earnings results, IG GROUP, leverage trading, Regulatory Crackdown

IG Group (LON: IGG), Europe’s largest CFD brokerage firm has reported its first-quarter earnings results for FY 19, registering a drop in revenue what could be an early sign of the effects of the regulatory crackdown. IG Group has May 31st fiscal year end and the latest quarterly result shows if of June to August 2018 period.

During the quarter, the revenue for the company came in at £128.9m, which is 5 per cent lower compared to the same period last year which was at £135.2m and is 13 per cent lower compared to previous month. The fall in revenue was driven by the decline in derivatives trading of 12 per cent and 8 per cent in EMEA and UK region respectively. Also, there is a ban on binary options for two months that kicked in at the beginning of July. Breaking up the revenue, IG Group reported an increase in revenue from its APAC region where it booked 7 per cent gain to £35.5 million.

IG Group had predicted that it would suffer a 10 per cent decline in revenue generation from the changes in the structure of leverage trading that was introduced by ESMA. It seems the predictions are as per the line although the sample size is quite less. IG Group also said that the heightened level of volatility which led to robust client activity in the first half of this year failed to continue into the FY 19.

The group said that the more than half of the revenue in the first quarter has been generated by professional traders who don’t fall under the purview of latest regulatory guidelines. During the quarter it also received the license from the German regulator the German unit to offer financial services to EU clients in the run-up to Brexit. Increase in total group clients somewhat remains flat with a 3 per cent increase to 129,000, helped primarily by growth in share dealing and investment clients. The number of clients in UK and EMEA region declined, in which UK reported 13 per cent drop and EMEA reported 10 per cent drop.

Former IG Executive, Alex Howard Joins Gain Capital as MD of Asia Pacific Region

September 6, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: Alex Howard, FX, GAIN, Gain Capital, IG GROUP, industry knowledge, Samantha Roady

Gain Capital, the largest provider of Fx in the United States has announced the appointment of former IG executive Alex Howard as Managing Director of Asia Pacific region, excluding China. His new role will be effective from September 3rd, 2018.

His new role includes the responsibility of managing the overall strategic execution and performance of GAIN’s retail business in Australia, Singapore, Japan and Southeast Asia. Mr Howard will be based ou in GAIN’s Singapore office.

Mr Howard has considerable experience in managing the Asia Pacific region through his previous assignments. With joining Gain Capital, Mr Howard ended his eight years long tenure at online brokerage IG Group. Initially, he joined as a Head of Operations in 2010 and then promoted to Vice President in 2010 and then went to lead the operations in Japan. Most recently, he was the Head of APAC for IG Group.

Samantha Roady, President of Retail Trading at GAIN

Samantha Roady. President of Retail Trading at GAIN said on the appointment:

“We are very pleased to welcome Alex to the GAIN leadership team. His deep industry knowledge and extensive experience developing and leading commercial strategies in the Asia Pacific region will be extremely valuable as we look to scale our key markets in the region, including Singapore, Australia and Japan, as well as develop our business in fast-growing, emerging markets in Southeast Asia,”

Alex Howard added:

“GAIN has made tremendous progress over the last few years growing its retail business in the US, UK and Europe, and I look forward to continuing to build on that momentum in the Asia Pacific region, which is a dynamic and diverse region undergoing a rapid transformation in retail financial services. There is substantial opportunity for expansion of GAIN’s business in the region and we believe it will be a key contributor to the firm’s future growth.”

IG Group Reports Strong 32% Jump in Net Profits in FY-2018, Lowers FY-19 Target on Regulatory Challenges

July 25, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: CFD industry, CFD leverage, Cryptocurrencies, dividend, earnings report, earnings reports, ESMA, ESMA regulations, forex brokerage, IG GROUP, IGG, leveraged trading, market volatility, Net Profits, operating profit, profits, retail clients, trading revenue

Peter Hetherington, IG Group Chief Executive

UK’s leading forex brokerage group, IG Group Holdings Plc (LON: IGG) has reported earnings report for the fiscal ending 2018 ( IG has May 31st fiscal year end). The group has recorded more than 30 per cent jump in profits for the full year and has announced a higher dividend. The group also cautioned investors that the earnings growth in the FY19 may weaken down on the account of CFD leverage caps being instituted by ESMA, which is scheduled for next month implementation.

The net trading revenue for the FY 18, came in at £569.0 million, an increase of 16 per cent from £491.1 million in FY 17. The operating profit during the year has increased by 32 per cent to £281.1 million, an increase from £213.4 million in FY 17. The earnings reports surpassed expectations of many analysts who have predicted a rise of $273.9 million in operating profits.

According to the company, the strong results are due to the increased excitement around cryptocurrencies and heightened market volatility in the financial market in the first quarter of this year. Operating profits margin came in at 49.4 per cent against 43.5 per cent in FY 17. The group has announced a final dividend of 43.2 pence per share, an increase of 34.2 per cent compared to previous year.

The IG’s operation is still heavily dependent on UK operations, with a revenue share of close to 45 per cent, next is EMEA which contributes close to 29 per cent in revenue and APAC region contributed 25 per cent of the total revenue. Also, the APAC region was IG’s fastest-growing region in 2018 with 20 per cent growth.

IG which led a fierce lobbying campaign against the curbs feels that the initial effect on revenue on account of ESMA regulations will be 10 per cent.

Peter Hetherington, Chief Executive, commented:

“The Company delivered record revenue, operating profit and earnings in FY18, driven by strong growth across all regions and products, and has continued to make good strategic and operational progress. We will continue with the investments we are making to deliver future growth and to position the business to benefit from the strong demand for our products.”

“We are pleased that there is now greater clarity around the nature and extent of regulatory change in the UK and EU affecting the CFD industry. As ESMA’s product intervention measures are focused on the CFD industry, they risk creating an unlevel playing field by giving an advantage to other forms of leveraged trading products which are offered to retail clients. IG has a long history of successful innovation, and is committed to offering the widest possible range of trading opportunities to appropriate clients that are fully compliant with regulations.”

“IG has delivered a sustainable business for more than 40 years by placing good client outcomes at the heart of everything it does. IG’s business model ensures that its interests as a business are aligned with the interests of its clients, which sets it apart from most companies in the industry. IG will continue to lead the way in the industry, and the business is well positioned to mitigate the impact of regulatory change and to continue to deliver sustainable growth and attractive shareholder returns.”

IG Group Announces Strategic Technology Partnership with PrimeXM for CFD and FX Liquidity

July 19, 2018 by Karthik Subramanian Leave a Comment Filed Under: Industry News Tagged: brokerage, CFD, Fouad Bajjali, FX liquidity, IG, IG GROUP, institutional clients, liquidity, PrimeXM, Retail Fx, retail Fx brokerage, Richard Bartlett, risk management, traders, XCore

The London-based major retail Fx brokerage group, IG Group and financial connectivity solution provider, PrimeXM have entered into a strategic technology partnership, that will see IG joining PrimeXM’s X core community of liquidity providers.

Prime XM’s primary offering is the XCore, that acts a liquidity aggregator of more than 120 firms and provides a centralized environment for liquidity and risk management. The parties stated that this partnership will deliver unique capabilities and solutions for traders and institutional clients globally and will allow both organizations to expand their unique value proposition and will further enhance their cutting edge offerings.

Through this partnership, IG will able to address the continued demand for flexible and innovative technologies. It will operate across Prime XM’s ultra low-latency connectivity across the globe thus improving trading speeds for clients. The users will now have access to hundreds of liquidity sources, including tier-1 banks, prime brokers and other leading global industry participants.

Richard Bartlett, PrimeXM Head of Global Sales

Commenting on the new partnership, PrimeXM Head of Global Sales, Richard Bartlett said:

“We are excited about this new partnership with IG. Our shared commitment to offering market-leading levels of execution performance and services to our clients made the decision to create this strategic alliance an easy one. One of the key benefits we are delivering here is expanding liquidity distribution opportunities globally for the IG Group via PrimeXM’s dedicated low-latency network and adding another strong liquidity partner for PrimeXM’s existing client base to take advantage of.”

Fouad Bajjali, Global Head of Institutional at IG noted:

“We are delighted to partner with a leading technology provider with a global reach such as PrimeXM. We are convinced that this partnership will improve access to our CFD and FX liquidity to counterparties across the globe.”