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Intercontinental Exchange Announces Record Trading in TTF Natural Gas and JKM LNG (Platts) Contracts

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ICEIntercontinental Exchange (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced record trading in February in the TTF Natural Gas and JKM LNG (Platts) contracts.

TTF futures and options combined hit an open interest (OI) record of 1.47m lots in February and hit a volume record of 968.69 TWh. TTF options traded at a record 126.38 TWh during the month, including hitting a record 40.58 TWh on February 21, 2019, an increase of 55% compared to the previous single day trading record for TTF from November 2017. Average daily volume (ADV) and OI in TTF futures and options combined are up 47% and 74%, respectively, in February 2019, versus February 2018. ICE reports OI net in line with standard industry practice.

JKM LNG (Platts) futures traded a record 26,552 lots in February and hit an OI record of 30,795 lots on February 28, 2019. ADV and OI in JKM LNG (Platts) are up 395% and 164%, respectively, in February 2019, versus February 2018. JKM LNG (Platts) Average Price Options launched on March 4, 2019, and have become the first ever cleared JKM options. The trade was a Winter 2019 $9 Call for 25 lots.

“Back in February 2010, ICE identified TTF as an emerging natural gas hub. Today TTF has grown into the most liquid European natural gas benchmark, alongside NBP. With its continued record trading activity, TTF has strong potential to become the global natural gas benchmark,” said Gordon Bennett, Managing Director, Utility Markets at Intercontinental Exchange. “JKM LNG (Platts) continues to break new records as one of the fastest growing natural gas benchmarks and the most liquid Asian natural gas benchmark.”

As home to the broadest range of natural gas benchmarks, ICE plays a leading role in providing access to price transparency and data to allow the market to navigate and risk manage the globalization of natural gas and the ongoing transition in energy markets.

About Intercontinental Exchange

Intercontinental Exchange (NYSE:ICE) is a Fortune 500 company formed in the year 2000 to modernize markets. ICE serves customers by operating the exchanges, clearing houses and information services they rely upon to invest, trade and manage risk across global financial and commodity markets. A leader in market data, ICE Data Services serves the information and connectivity needs across virtually all asset classes. As the parent company of the New York Stock Exchange, the company is the premier venue for raising capital in the world, driving economic growth and transforming markets.

Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located at http://www.intercontinentalexchange.com/terms-of-use. Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading “Key Information Documents (KIDS).”

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 — Statements in this press release regarding ICE’s business that are not historical facts are “forward-looking statements” that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE’s Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in ICE’s Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 7, 2019.

SOURCE: Intercontinental Exchange

Tradeweb Files for Initial Public Offering With CFTC

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Trade Web Initial Public OfferingThe net proceeds from the offering will be used to purchase equity interests from certain existing owners, although Refinitiv will continue to own a controlling interest in the company following the Initial Public Offering.

Tradeweb Markets has filed a registration statement on Form S-1 with the Securities and Exchange Commission for a proposed initial public offering of its Class A common stock, according to a press release.

The global operator of electronic marketplaces for rates, credit, money markets and equities has not yet determined the number of shares to be offered and the price range for the offering, but its common stock is intended to be listed on the NASDAQ Global Select Market under the ticker symbol “TW.”

TradeWeb has selected J.P. Morgan, Citigroup, Goldman Sachs & Co. LLC and Morgan Stanley to act as the joint book-running managers for the offering, which has been filed with the Securities and Exchange Commission but has not yet become effective.

Tradeweb a world leader in building and operating electronic over-the-counter marketplaces. Since 1998 the company has helped transform the way that business gets done in the fixed income and derivatives markets. Tradeweb’s position as the hub of electronic trading in fixed income and derivatives business has been made possible through a longstanding partnership with the industry.

The firm is a member of CFTC’s Technology Advisor Committee, which is made up of twenty-nine members and includes CME, ICE, and NASDAQ, Goldman Sachs, Blackrock, and Bloomberg, as well as LedgerX and Fidessa.

Dealerweb, the company’s wholesale and inter-dealer trading division, has recently striked a deal with Thomson Reuters to enhance its U.S. Treasury and Interest Rate Swaps pricing solution by providing its fixed-income trading clients with a global rates offering to further enable their trading decisions.
Tradeweb’s plans to go public come five months after being acquired as part of a $17 billion buyout of Refinitiv, between Blackstone and Thomson Reuters.. Tradeweb’s initial offering size for the IPO is $100 million, but could be worth more than $5 billion in an IPO, Bloomberg found. In 2018, net income rose from $83.6 million to $159.5 million and revenue increased from $563 million to $684.4 million.

Moscow Exchange Announces Financial Results for the Full Year 2018

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Moex Logo FeaturedMoscow Exchange (MOEX) today announces its financial results in accordance with International Financial Reporting Standards (IFRS) for the year ended 31 December 2018. Strong performance across all trading markets, led by Equities and Derivatives and supported by the Money Market, helped achieve another year of record fees and commissions (F&C).

Unless stated otherwise, all figures below refer to performance in 2018 and all comparisons are with the previous year.

KEY FINANCIAL HIGHLIGHTS FOR 2018

  • Fee and commission income increased 11.5% to an all-time high of RUB 23.6 bln, driven by growth of fee income across all markets.
  • Net interest and finance income (excluding realized gains/losses from investment portfolio revaluation) was RUB 15.8 bln, down 2.9%.
  • Operating expenses[1] were kept under control, increasing by just 7.6%. Excluding D&A expenses, operating costs were up 6.1%.
  • Adjusted EBITDA for the year was RUB 28.7 bln, with a best-in-class margin of 71.9%.

KEY BUSINESS & CORPORATE HIGHLIGHTS FOR 2018

  • MOEX remains the center for capital raising by Russian corporates, which placed bonds with a total value of more than RUB 2.33 trln in 2018. There were 324 bond issues by 111 corporates during the period, including 38 newcomers to the market.
  • MOEX introduced new products across its markets. Seven new currency pairs started trading on the FX Market. Contracts on Light Sweet Crude Oil, the US500 index, four metal price benchmarks, a new currency pair and deliverable futures on gold became available on the Derivatives Market. Trading in soybean and sunflower seeds was launched in the Commodities Market. Five new ETFs under Russian legislation have started trading in the Equities Market to date.
  • MOEX completed the Unified Collateral Pool (UCP) project, introducing unified collateral requirements across all markets, as well as netting of settlements and cross-margining. 45 companies have joined the UCP to date.
  • Corporates have continued to join the FX and Money Markets. As of today, 113 corporates have opened deposits with the CCP, and 36 corporates can trade on the FX Market directly.
  • More than 600,000 retail investors opened brokerage accounts in 2018, bringing the total number of accounts to 1.96 mln by year-end 2018. The number of IIAs held by private investors reached 598,000 by year-end, compared to 302,000 a year earlier. As of today, the number of IIAs accounts reached 674,184.
  • MOEX continued to develop services that facilitate access to trading and open new opportunities for Moscow Exchangparticipants. The Exchange introduced an OTC platform for bonds, links to global OTC liquidity in EUR/USD and GBP/USD for FX Market participants, the Indicative Quotation System (IQS) for trading derivatives with less liquid underlying.

Alexander Afanasiev, Chief Executive Officer of Moscow Exchange, said:

“In 2018, trading volumes rose significantly across nearly all markets, enabling the Exchange to set a new record for annual fee and commission income. An important growth driver was the surge of retail investor operations in the market and the growth of private investment in exchange-traded assets. We see that the efforts of MOEX and the entire financial community to grow domestic retail investing have begun to deliver results. Since the beginning of 2018, the number of individual brokerage accounts has increased by more than 800 thousand to 2.12 million today. I am confident this growth will continue.

“MOEX’s core mission is to promote economic growth in Russia by providing access to the capital markets for both large companies and medium-sized enterprises. In 2018, Russian issuers raised more than two trillion rubles on the exchange to develop their businesses, primarily through the placement of bonds.

“The growth of client trading activity also demonstrates strong demand for MOEX’s products and services, as well as innovative clearing and collateral management solutions. We are successfully further differentiating our product line and developing trading in new asset classes. For example, as the grain market builds momentum, it is making greater contributions to total revenue.

“These trends that reflect substantial and sustainable growth of our business make us optimistic about MOEX’s performances in 2019.”

Maxim Lapin, Chief Financial Officer of Moscow Exchange, said:

“2018 was a strong year for F&C income, which increased by 11.5%. F&C growth accelerated YoY and outpaced the rolling four-year CAGR of 11.0%. In Q4 2018, we had record-high F&C income, surpassing the RUB 6 bln mark for the first time in a single quarter to reach RUB 6.3 bln. Equities (+20.0%), Derivatives (+15.3%) and the Money Market (13.1%) were the outperformers that supported the overall annual growth rate. F&C income accounted for 59.3% of operating income in FY 2018 and 62.8% in Q4 2018.

At the same time, Core NII stabilized at RUB 15.8 bln, which is nearly flat YoY. The easing cycle in Russia came to a pause, while monetary tightening in the US propped up the USD-denominated part of NII. On the cost side, we had a minor OPEX acceleration in Q4 2018, in line with our usual seasonality. For FY2018, OPEX ended up comfortably within the original guidance range of 7-9%, and closer towards the lower end of this range. The legal provision made in Q2 2018 was 75% reversed in Q4 2018 following our win in the cassation court. Overall, reported FY2018 net income declined by a mere 2.6% and would have increased by 2.5% on an adjusted basis.”

FINANCIAL HIGHLIGHTS

RUB mlnFY 2018FY 2017ChangeQ4 2018Q4 2017Change
Operating income39,901.438,538.93.5%10,028.09,591.44.6%
  • Fee and commission income
23,647.121,207.611.5%6,296.65,790.88.7%
  • Net interest and other finance income (NII)[2]
16,061.017,285.3(7.1%)3,723.53,785.4(1.6%)
NII less realized gains or losses on investment portfolio revaluation[3]15,799.016,269.5(2.9%)3,782.53,435.010.1%
  • Other operating income
193.346.0320.2%7.915.2(48.0%)
Operating expenses14,453.713,431.87.6%3,914.43,630.17.8%
  • Personnel expenses
6,512.36,152.95.8%1,723.61,597.37.9%
  • D&A and IT maintenance
4,545.04,072.611.6%1,185.71,075.810.2%
  • Professional services
572.6426.334.3%164.9102.061.7%
  • Other general and administrative expenses
2,823.82,780.01.6%840.2855.0(1.7%)
Profit before other operating expenses and tax25,447.725,107.11.4%6,113.65,961.32.6%
Other operating gains/(expenses)(1,075.2)–nm654.7–nm
Net profit19,720.320,255.2(2.6%)5,463.44,814.513.5%
Basic earnings per share, RUB8.769.02(2.8%)2.432.1513.0%
Reconciliation of adjusted metrics
Net profit19,720.320,255.2(2.6%)5,463.44,814.513.5%
  • Other operating (gains)/expenses
1,075.2–nm(654.7)–nm
  • Deferred taxes related to one-off provisions
(215.0)–nm131.0–nm
  • Adjustment for the new D&A schedule and changes to IFRS 9
173.0–nm83.9–nm
Adjusted net profit20,753.420,255.22.5%5,023.64,814.54.3%
EBITDA27,712.028,059.6-1.2%7,609.36,729.013.1%
  • Other operating (gains)/expenses
1,075.2–nm(654.7)–nm
  • IFRS 9 allowance reversal
(117.5)–nm22.7–nm
Adjusted EBITDA28,669.728,059.62.2%6,977.36,729.03.7%
Adjusted EBITDA margin71.9%72.8%(0.9 pp)69.6%70.2%(0.6 pp)
Operating expenses net of non-cash changes in amortization schedules of 201814,120.013,431.85.1%3,832.23,630.15.6%

PERFORMANCE OF KEY BUSINESS LINES

RUB mlnFY 2018FY 2017ChangeQ4 2018Q4 2017Change
Equities Market 
Fee and commission income, RUB mln1,932.21,610.220.0%480.1419.814.4%
Trading volumes, RUB bln10,829.69,185.517.9%2,730.82,309.418.2%
Bond Market
Fee and commission income, RUB mln2,173.51,982.59.6%493.1668.7(26.3%)
Trading volumes (ex. overnight bonds), RUB bln21,216.016,563.128.1%5,109.15,299.7(3.6%)
FX Market
Fee and commission income, RUB mln3,990.03,827.04.3%989.3945.44.6%
Trading volumes, RUB bln348,368.4347,670.80.2%83,694.084,347.4(0.8%)
Money Market
Fee and commission income, RUB mln6,389.85,650.013.1%1,750.31,555.112.6%
Trading volumes, RUB bln364,215.8377,140.6(3.4%)96,173.788,761.98.4%
Derivatives Market
Fee and commission income, RUB mln2,318.92,012.015.3%646.5539.419.9%
Trading volumes, RUB bln89,263.184,496.75.6%24,784.420,029.023.7%
Depository and Settlement Services
Fee and commission income, RUB mln4,530.74,183.98.3%1,265.21,108.614.1%
Average assets under custody, RUB bln42,797.836,766.416.4%43,807.439,037.312.2%
Other fee and commission income (IT Services, Listing and other)
Information services, RUB mln792.4769.72.9%227.4222.62.2%
Sale of software and tech. services, RUB mln695.9630.710.3%183.0150.921.3%
Listing and other services, RUB mln338.3392.3(13.8%)101.9110.1(7.4%)
Other fee income, RUB mln485.4149.3225.1%159.870.2127.6%
Net interest and other finance income
Net interest and other finance income, RUB mln16,061.017,285.3(7.1%)3,723.53,785.4(1.6%)
Investment portfolio, RUB bln670.1748.6(10.5%)664.8592.912.1%
  • Fee and commission income from the Equities Market grew by 20.0% on the back of strong growth in trading volumes. The total market capitalisation of companies listed on MOEX was RUB 40.0 trln (USD 576.1 bln) as of 31 December 2018.
  • Fee income from the Bond Market increased 9.6% due to high activity in the primary market (placement volumes up 2.0x excluding overnight bonds). The effective fee in the Bond Market declined due to the shorter average maturity of bonds placed in the corporate segment and a higher proportion of CBR bonds in the primary market.
  • Fees and commissions from the Money Market grew 13.1%. Trading volumes declined 3.4% YoY due to lower volumes of repo with the CBR (-97.7%) and interdealer repo (-31.4%). The decrease was partially offset by GCC repo, where volumes were up 7.6x. The shift towards value-added GCC repo along with extension of repo terms supported the effective fee on the Money Market.
  • The Derivatives Market saw 15.3% growth of fees and commissions. This was due to a combination of trading volumes growth and mix improvement thanks to the shift towards commodity and single-stock contracts.
  • Average assets under custody at NSD grew 16.4%. This supported fee income, which continued to grow (+8.3%). At the same time, lower trading volumes of repo with CMS through the NSD
    (-58.8%) had a negative effect on the income line.
  • Other fee income grew 3.3x due to explosive growth of fees from the Commodities Market.
  • The cash position[4] at the end of 2018 was RUB 89.73 bln. The company had no debt as of the end of the quarter.
  • Capex for the year was RUB 2.01 bln, all of which was spent on purchases of equipment and software as well as software development.

Moscow Exchange’s consolidated IFRS financial statements for FY and Q4 2018 are available on the Investor Relations section of the company’s web site.

The FY and Q4 2018 IFRS Financial Results webcast is scheduled for 6 March 2019 at 5:00 pm (Moscow time).

Contacts:

Investor Relations:Public Relations:
Anton Terentiev

+7 495 363 3232

ir@moex.com

Lev Bystrov

+7 495 363 3232

pr@moex.com

NOTES TO EDITORS

About Moscow Exchange

Moscow Exchange Group operates Russia’s main trading platform for equities, bonds, derivative instruments, currencies, money market instruments and commodities. The Group includes the central securities depository (National Settlement Depository), and a clearing center (National Clearing Centre), performing the functions of central counterparty on the markets, which allows Moscow Exchange to offer its clients the full spectrum of trading and post-trading services.

Moscow Exchange was formed in December 2011 as a result of a merger between Russia’s two main exchange groups – MICEX Group, the oldest domestic exchange and operator of the leading securities, foreign exchange and money market platform in Russia; and RTS Group, at the time the operator of Russia’s leading derivatives market. This combination created a vertically integrated public trading market across most major asset classes named Moscow Exchange. Moscow Exchange held the initial public offering of its shares on 15 February 2013 (ticker MOEX).

Disclaimers

Some of the information in these materials may contain projections or other forward-looking statements regarding future events or the future financial performance of the Company. You can identify forward looking statements by terms such as “expect”, “believe”, “anticipate”, “estimate”, “intend”, “will”, “could,” “may” or “might” the negative of such terms or other similar expressions. The Company wishes to caution you that these statements are only predictions and that actual events or results may differ materially. The Company does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in the Russian Federation, rapid technological and market change in the industries the Company operates in, as well as many other risks specifically related to the Company and its operations.

[1] Net of Other operating expenses (one-off provisions)

[2] Calculated as the sum of interest and other finance income, gains/losses on FVTOCI, gains/losses on AFS and foreign exchange gains less losses less interest expense.

[3] Calculated as the sum of iInterest and other finance income and fForeign exchange gains less losses less interest expense (compared to net interest and other finance income, excludes gains/losses on FVTOCI and gains/losses on AFS).

[4] Cash position is calculated as the sum of Cash and cash equivalents, Financial assets at fair value through profit and loss, Due from financial institutions, Financial assets at fair value though other comprehensive income less Balances of market participants, Overnight bank loans,  and Distributions payable to holders of securities and Margin Account..

CFTC Announces Whistleblower Award Totaling More Than $2 Million

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CFTCThe Commodity Futures Trading Commission (CFTC) today announced a whistleblower award totaling more than $2 million to be paid to an individual whistleblower. The CFTC granted the whistleblower’s award application for both a CFTC action and a related action brought by another federal regulator. In ordering the award, the CFTC recognizes the contribution of a whistleblower in providing critical information through independent analysis of market data.

James McDonald, CFTC’s Head of Enforcement

James McDonald, CFTC’s Head of Enforcement

James McDonald, Director of CFTC’s Division of Enforcement, said,  “The Commission is dedicated to working cooperatively with other federal regulators, and this case highlights how successful we can be when we appropriately share high-quality whistleblower information and analysis with our law enforcement partners. I look forward to seeing continued growth in our Whistleblower Program, both in terms of tips received and awards ordered.”

“Today’s award illustrates two key aspects of our Whistleblower Program — that an individual doesn’t have to be an insider to receive a whistleblower award and the Commission can pay awards based on related actions brought by other regulators,” said Christopher Ehrman, Director of CFTC’s Whistleblower Office.  “I expect more awards to be issued to whistleblowers who provide our Enforcement Division with information based on their expert analysis of market data and to whistleblowers based on related actions.”

CFTC’s Whistleblower Program was created under Section 748 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.  The CFTC can pay awards not only on CFTC enforcement actions, but also on related actions brought by other federal regulators if certain conditions are met.  Whistleblowers are eligible to receive between 10 and 30 percent of the monetary sanctions collected.

The Commodity Exchange Act (CEA) provides confidentiality protections for whistleblowers.  Regardless of whether the CFTC grants an award, the CFTC will not disclose any information which could reasonably be expected to reveal a whistleblower’s identity, except in limited circumstances such as when disclosure is required in connection with a public proceeding, or when the Director of the Division of Enforcement exercises his/her authority to share important information with other regulators.  Consistent with this confidentiality requirement, the CFTC will not disclose the name of the enforcement action in which the whistleblower provided information or the exact dollar amount of the award granted.

All whistleblower awards are paid from the CFTC Customer Protection Fund established by Congress and financed entirely through monetary sanctions paid to the CFTC by violators of the CEA.  No money is taken or withheld from harmed investors to fund the program.

Since issuing its first award in 2014, through 2018, the CFTC has awarded more than $85 million to whistleblowers.  The Division of Enforcement actions associated with those awards have resulted in sanctions orders totaling more than $675 million.

* * * * *

Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the CFTC’s Whistleblower Office via a Toll-Free Hotline (866-873-5675) or file a tip or complaint online.

For more information about the CFTC’s Whistleblower Program go to https://www.whistleblower.gov/.

BCSC Imposes Reciprocal Orders on Two B.C. Men

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British Columbia Securities CommissionA panel of the British Columbia Securities Commission has reciprocated enforcement orders against two men who pleaded guilty to investment fraud in two separate criminal cases – one in British Columbia, the other in the U.S.

The panel permanently banned Edward Earl Chieduch from trading in or purchasing securities or exchange contracts, acting as a director or officer of any issuer or registrant, acting as a registrant or promoter, acting in a management or consultative capacity in the securities markets, or engaging in investor relations activities.

Chieduch had pleaded guilty in B.C. Provincial Court in Kamloops to a single count of fraud in connection with the defrauding of eight investors in a Ponzi scheme between 2005 and 2010. He was sentenced in 2012 to two years in jail.

The panel also banned Mitchell Gordon Adam for four years from trading in or purchasing securities or exchange contracts, acting as a director or officer of any issuer or registrant, acting as a registrant or promoter, acting in a management or consultative capacity in the securities markets or engaging in investor relations activities.

Adam pleaded guilty in U.S. federal court in 2015 to conspiracy to commit securities fraud and mail fraud for his part in a stock market manipulation scheme involving a publicly-traded company, Lido International Corporation. He was sentenced by the U.S. federal court to time served.


About the British Columbia Securities Commission (www.bcsc.bc.ca)  

The British Columbia Securities Commission is the independent provincial government agency responsible for regulating capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and promote the public interest by fostering:

  • A securities market that is fair and warrants public confidence
  • A dynamic and competitive securities industry that provides investment opportunities and access to capital

FCA Urges Unauthorised Land Banking Scheme Victims to Get in Touch to Return Funds

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fcaThe Financial Conduct Authority (FCA) is urging members of the public who invested in unauthorised collective investment scheme, and who may be eligible to receive some of their money back, to get in contact with the FCA.

Between 2005 and 2010, approximately 870 members of the public invested approximately £32.8m in unauthorised collective investment schemes established and operated by Countrywide Land Holdings Limited, James Kenneth Maynard (trading as Regional Land and Countrywide Land Holdings Limited) and Stephen Ronald Watkins (trading as Consolidated Land UK Limited).  These schemes involved the unlawful selling of plots of land.

Following High Court cases in which the unauthorised businesses were ordered to repay investors, the FCA has received approximately £2.5m from a related Panamanian company Paradigm Consultancy S.A., which it intends to return to eligible investors.

To date, only 392 out of approximately 870 possible investors have contacted the FCA.

The FCA urges investors who think they might have invested, or might recall family members investing in these schemes, to get in contact.

Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said:

‘If you believe you were an investor in one of these unauthorised schemes, please get in contact with us. We will work to resolve this matter and return funds to eligible investors as soon as is possible but we need to demonstrate to the Court that we have taken reasonable steps to identify everyone affected.’

Investors who have not yet contacted the FCA, should do so even if they no longer have records or documentation relating to the investments. In the first instance, they should email paradigm.investors@fca.org.uk or write to the FCA at Freepost RTZE–RHAL–URAJ, for the attention of UBD RC RE00654, Financial Conduct Authority, 12 Endeavour Square, London E20 1JN.

Notes to editors

In CFTC Action, Former Trader Krishna Mohan Admits to Engaging in Spoofing and Manipulative Scheme at a Proprietary Trading Firm

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CFTC LogoCFTC Order Recognizes Mohan’s Entry into a Cooperation Agreement with the Division of Enforcement

The Commodity Futures Trading Commission (CFTC) today issued an Order filing and settling charges against Krishna Mohan (Mohan), in which Mohan admits to engaging in manipulative and deceptive schemes, along with other individuals, which involved thousands of acts of spoofing (bidding or offering with the intent to cancel the bid or offer before execution) in a variety of futures contracts traded on the Chicago Mercantile Exchange and Chicago Board of Trade. The Order finds that Mohan engaged in this unlawful activity while trading for his former employer, a proprietary trading firm named as “Firm A” in the Order.

The Order requires Mohan to cease and desist from violating the Commodity Exchange Act’s prohibition on spoofing and the use of manipulative and deceptive schemes. The Order also bans Mohan for three years from trading and other activities in CFTC-regulated markets. In addition, the Order recognizes Mohan’s entry into a formal cooperation agreement with the CFTC’s Division of Enforcement (Division). In the Order, the CFTC reserves its determination as to monetary sanctions against Mohan in recognition of Mohan’s agreement to continue to cooperate with the Division pursuant to the cooperation agreement.

James McDonald, the Director of Enforcement, commented: “Today’s enforcement action again demonstrates the CFTC’s continued emphasis on pursuing individuals who spoof in our markets.  This action also reflects some of the tools we can bring to bear in rooting out misconduct in our markets. As has been shown recently and again shown here, in certain cases under the Division’s cooperation program, where an individual has demonstrated a commitment to cooperate and has cooperated, the Commission may elect to postpone the evaluation and assessment of monetary sanctions until cooperation is substantially complete.”    

The Order finds that from at least September 2012 through March 2014 at Firm A, Mohan, both individually and in coordination with others, placed thousands of orders to buy or sell futures contracts with the intent to cancel those orders prior to execution. In doing so, the Order finds that Mohan intentionally sent false signals of increased supply or demand designed to trick market participants into executing against the orders he wanted filled.

The CFTC previously filed charges against Mohan for this conduct in the U.S. District Court for the Southern District of Texas, CFTC v. Mohan, No. 18-cv-260 (S.D. Tex. Jan. 28, 2018). That action was dismissed without prejudice in connection with the filing of this administrative proceeding.

Criminal Action

In a separate action, Mohan recently pleaded guilty in the U.S. District Court for the Southern District of Texas to one count of conspiracy to commit wire fraud, spoofing, and commodities fraud, with regard to conduct similar to that in the CFTC action. Mohan is awaiting sentencing on that charge.

The CFTC’s Enforcement Division acknowledges and thanks the staff of the Market Regulation Department of the CME Group; the U.S. Department of Justice, Fraud Section; and the Federal Bureau of Investigation for their assistance.

This case is brought in connection with the CFTC Division of Enforcement’s Spoofing Task Force, and the staff members responsible are Rachel Hayes, Rebecca Jelinek, Allison Sizemore, Stephen Turley, Peter Riggs, Chris Reed, and Charles Marvine.

SAXO Bank Reports Record Net Profits for FY 2018 Post Group’s Completion of Process

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saxo bankCopenhagen-based multi-asset broker SAXO Bank has reported its 2018 financials, posting a sharp increase in net profits during the period. The broker posted a record net profit of DKK 955.8 million (roughly $145 million) for 2018, which is 138 per cent higher compared to 2017 financials at $61 million.

The overall financial health of the group has improved tremendously after the completion of the acquisition and restructuring process of the group.

The group in its financial report has shown an increased client deposit level at DKK 112.6 billion ($17billion), a record for the company. Other financial metrics are as follows:

  • The net operating income witnessed a slight drop at $426.33 million, which is 8 per cent lower compared to 2017 figures at $456.83 million.
  • The EBITDA came in at $214.36 million in 2018, compared to $141.86 million in 2017, an increase of 51 per cent.
  • Total equity at the end of 31st December 2018 came in at $852 million, compared to $700.39 million in 2017.

The group also reported a stronger capital position, with total capital ration coming in at 35 per cent as on 31st Dec 2018, compared to 22.7 per cent reported at the end of 2017. This will help to provide an adequate capital buffer for the company.

The group streamlined its business operation in 2018 to completely focus on trading and investment activities which led to the sale of two non-core businesses SAXO Privatbank and Saxo Payments. Founder and CEO of Saxo Bank, Kim Fournais said on the result:

“2018 has been a defining year for Saxo Bank. We are very proud to have welcomed Geely Holding Group and Sampo plc as new shareholders giving us a strong foundation and governance to execute on our long-term plans.We have launched a wide range of new products, platforms, services and improvements in our pricing to our clients notably the two new platforms, SaxoTraderPRO and SaxoInvestor.  All of this enables us to deliver a world-class client experience which has supported the 67 per cent increase in new direct trading clients.”

“Contributing factors to the small decline in revenue are the sale of our last non-core activities, lower client activity levels given the generally difficult market conditions as well as the introduction of lower prices across products.”

“We continue the new year with record high investments in our technology and people to improve the SaxoExperience to be the partner of choice for traders, investors and wholesale partners whilst reducing cost and complexity in a scalable manner.”

“With a stronger capital base than ever before, we have a solid foundation for executing the planned acquisition of BinckBank. BinckBank and Saxo Bank are highly complementary, and the combination of the businesses will create win-win for all stakeholders as clients will be offered better products, prices, platforms and services, employees will benefit from enhanced career opportunities in a larger international organisation and, crucially, we gain necessary scale.”

“Funds in Focus”: Invest like Warren Buffet – Value Investing in 2019

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SIX Swiss Exchange“Funds in Focus”: Invest like Warren Buffet – Value Investing in 2019

A series of articles by Bank Julius Baer looks at topical investment themes in the Sponsored Funds trading segment of SIX Swiss Exchange.

Focus on the investment approach “value strategy” – this the latest guest contribution by Julius Baer[PDF]. Value investors do not want to achieve short-term profits, but instead make investments with long-term expectations. The current situation on the financial markets is not causing much concern among value investors, as they adhere to strict rules as to when to buy and resell a stock. They only buy a stock if the trading price is, for example, 40% lower than the intrinsic value that they have calculated. Benjamin Graham named this the safety margin. Value investors will only sell a stock once it has reached the calculated intrinsic value. A selection of traditional value investing investment funds that are traded at SIX in the Sponsored Funds segment are listed in this article.

Article series: “Funds in Focus”

Launched in March 2017, the series of articles “Funds in Focus” presents different topical investment themes, including a list of Sponsored Funds that relate to the given theme. The team of authors consists of the fund specialists at Bank Julius Baer that handle the market making of traditional investment funds.

The series of articles had started with a guest contribution about gold mine funds. The second issue in the series had looked at investment funds, that, when transacted in the traditional way on the primary market, attract commission paid to the fund by the investor – fees that can be avoided by trading fund units on the stock exchange. All the articles are available on our website.

SIX Swiss Exchange launched the trading segment for Sponsored Funds in March 2013 together with Julius Baer in November 2013. Currently the segment includes 436 products and close to 80 leading providers.

Broad information offering

We provide investors with extensive expertise and comprehensive information. You can view trading activity on SIX Swiss Exchange on our website at any time. Further information about the benefits of Sponsored Funds may be found in ourfactsheet[PDF].

BSE Expands Its Agri-Commodities Portfolio; Launches Cotton Futures Contract on the Exchange

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BSE LOGOBSE, Asia’s oldest exchange and now world’s fastest exchange with the speed of 6 microseconds, has begun trading in cotton futures contract today, after getting Sebi’s nod to launch the natural fibre on the commodity derivatives exchange.

As part of the launch, BSE organized a bell ringing ceremony at the BSE International Convention Hall, which saw several distinguished dignitaries – Atul Ganatra, President, Cotton Association of India, Arun Sakhseria, Director, Cotton Association of India, Dr P. Alli Rani, Chairman & Managing Director, Cotton Association of India and Pasha Patel, Chairman, Agriculture Price Commission Agriculture Price Commission – grace the event.

The unit of trading for the cotton contract is 25 bales and the deliveries will be tendered in 100 bales. The quotation for cotton futures is in Rs. per bale (of 170 kg). The basic delivery centre for the cotton contracts is Rajkot with additional delivery centres at Aurangabad, Jalgaon Yavatmal in Maharastra and Mundra and Kadi in Gujarat.

Shri Ashishkumar Chauhan, MD & CEO, BSE

Shri Ashishkumar Chauhan, MD & CEO, BSE

Commenting on the launch, Mr. Ashishkumar Chauhan, MD & CEO, BSE said, “With the launch of cotton contracts, we look forward to gain wider participation from cotton business stakeholders. While we began trading in commodities with gold and silver, our focus was to diversify and focus on agri products eventually. Last week, we launched Guarseed and Guargum that has witnessed record turnover and grabbed 36 % market share. We look forward for cotton futures contract to witness a marked rise in terms of volumes and emerge as the most compliant exchange in commodities.”

The contract start day will be the 1st day of contract launch month and the final trading day will be the last day of contract month. The commodity trading session will be from Monday to Friday from 9.00am to 9.00pm. It is a compulsory delivery contract, with the initial margins for the cotton contracts set at minimum 4 per cent or will be based on SPAN, whichever is higher.

About BSE

BSE (formerly Bombay Stock Exchange) established in 1875, is Asia’s first & now the world’s fastest Stock Exchange with a speed of 6 microseconds. BSE is India’s leading exchange group and has played a prominent role in developing the Indian capital market. BSE is a corporatized and demutualised entity, with a broad shareholder base that includes the leading global exchange- Deutsche Bourse, as a strategic partner. BSE provides an efficient and transparent market for trading in equity, debt instruments, equity derivatives, currency derivatives, interest rate derivatives, mutual funds and stock lending and borrowing.

BSE also has a dedicated platform for trading in equities of small and medium enterprises (SMEs) that has been highly successful. BSE also has a dedicated MF distribution platform BSE StAR MF which is India Largest Mutual Funds Distribution Infrastructure. On October 1, 2018, BSE launched commodity derivatives trading in delivery-based futures contract in gold (1 kg) and silver (30 kg).

BSE provides a host of other services to capital market participants including risk management, clearing, settlement, market data services and education. It has a global reach with customers around the world and a nation-wide presence. BSE’s systems and processes are designed to safeguard market integrity, drive the growth of the Indian capital market and stimulate innovation and competition across all market segments.

Indian Clearing Corporation Limited, a wholly owned subsidiary of BSE, acts as the central counterparty to all trades executed on the BSE trading platform and provides full novation, guaranteeing the settlement of all bonafide trades executed. BSE Institute Ltd, another fully owned subsidiary of BSE runs one of the most respected capital market educational institutes in the country. Central Depository Services Ltd. (CDSL), associate company of BSE, is one of the two Depositories in India.

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