IG Group reports £18.4m of client debt after January's SNB move

17th Mar 2015 08:03

London listed electronic trading firm IG Group on Tuesday revealed the full extent of the damage caused by the Swiss National Bank's move to scrap the franc's ceiling with the euro.In its third quarter trading update, IG, the country's biggest spread-trading and CFD broker by market share, reported that net revenue during the period reduced by £11.8m to £91.8m, 5.1% behind the same period last year following the SNB event on 15 January.Brokers were left nursing bruises after the SNB scrapped its four-year old currency ceiling in January, sending the Swiss franc up as much as 39% against the euro in response. IG Group said the turmoil in the Swiss franc resulted in client debts of £18.4m and the recovery of losses remains uncertain."Although half of the debtor accounts have now been settled, this relates to only a small proportion of the original £18.4m; the majority of remaining debtors may not be in a financial position to clear their debt in full," said IG.Excluding the SNB-triggered losses, the group reported underlying revenue gaining 7.1% to £103.6m. IG saw revenues in Europe dip 3.4% to £20.8m but reported underlying UK revenues up 8.9% to £55.4m from the same period last year."The performance in the third quarter and a good start to the final quarter positions IG well for the full year," IG Group said."The company continues to make good progress on its strategic initiatives, as it diversifies both geographically and through the offering of additional products, taking further steps towards its aim to become the default choice for active traders globally," the group added.IG said that its execution-only stockbroking business, which was launched in the UK in the second quarter of this financial year, continued to grow well in the period. At the end of February, IG had over 2,600 funded stockbroking accounts, of which around 70% are clients new to IG.Looking ahead, the group is acquiring a licence and launching its broader offering in Dubai and over the next twelve months, expects to expand its stockbroking offering to a further three more countries.