SGX Highlights FX as Profits Slip

Singapore Exchange has highlighted its growing FX business as a key focus in its latest semi-annual financial report, which shows a slight drop in adjusted net profit to SGD 221.8 million (versus SGD 228.0 million in H1 2021.

Commenting on the results, Loh Boon Chye, CEO of SGX, said, “We are making good progress in executing our multi-asset strategy. Our underlying core revenue has grown, with strong performance in our currencies and commodities, healthy market share and yields for our key equity derivative products, as well as steady growth in our market data and index business. In the last two years, we have made S$1 billion worth of acquisitions and investments to leapfrog our multi-asset strategy and capture the growth opportunities across asset classes and platforms. One clear example is in currencies where we now have a sizeable FX OTC and futures business that can scale further as we integrate our newly-acquired subsidiary MaxxTrader and ramp up our FX (ECN) in the coming months.”

During exchange’s first half of its financial year, SGX says total FX average daily volume – comprising both on-exchange futures and OTC – increased 46% from $39 billion to $57 billion, however this does not include activity on the ECN of MaxxTrader.

SGX’s FX ECN went live in November 2021 with successful trades completed across different currency pairs. The acquisition of FX platform MaxxTrader was completed in January 2022.

FICC revenue rose by 15% to SGD 114 million, driven largely by a 16% increase in currencies and commodities revenues to SGD 107.4 million.

Data from SGX as at end of December 2021 shows that INR and CNH contracts dominate its currency futures business, being responsible for more than 95% of activity during the first half of the financial year.