Saxo Bank reveals big profit hit as customer activity declines

Copenhagen-based broker Saxo Bank reported lower revenue and net profit for the first half of 2022 as client trading activity fell from a year earlier.

FX Bank announced its financial results for the six months ending June 30, 2022. The multi-asset group marked a decline in first-half revenue, which came to DKK 2.14 billion ($288 million ), down 12% from DKK 2.43 billion for the same period last year.

On earnings metrics, Saxo Bank disclosed a net profit of DKK 302 million ($40.6 million), down 41% from DKK 512 million from January to June 2022.

Meanwhile, Saxo Bank gained more customers with total active accounts exceeding 874,000 for the first time in the company’s 30-year history. Despite opening more than 84,000 new accounts in the first half of the year, total client assets on deposit decreased to DKK 591 billion from DKK 595 billion last year.

This decrease is mainly due to the decline in the equity market, but partly offset by positive net customer funding. However, this figure remains a record milestone for the Danish broker, which took 25 years to reach the DKK 100 billion mark and then only 4 years to add another DKK 490 billion of client assets.

BinckBank migration still pending

Commenting on the results, Kim Fournais, CEO and Founder of Saxo Bank, said: “The results are not satisfactory and are affected by difficult market conditions during the first half of 2022. Despite the volatility of the financial markets, the activity trading was lower than the same period. Last year. That said, we consider it a testament to the strength of our platforms that we continued to grow the number of new business customers, where we reached a new all-time high of 874,000 customers as of June 30.”

Saxo Bank added that the cost level remained almost unchanged, in particular due to the late completion of the migration of BinckBank, which added costs and complexity to the operation of two parallel infrastructures.

Saxo had completed the integration with BinckBank, which it acquired in 2019, but the last segment of the Dutch lender’s customers is yet to migrate later this year. The transaction added more than 400,000 direct customers in four jurisdictions in the Netherlands, Belgium, France and Italy.

Both companies have been working on integrating their technology infrastructure over the past two years. They also plan to launch additional products and services to better compete against fierce competition in the online trading and investing industry.

Saxo said their similar geographic footprint, products and customer bases meant the merger made sense and would also bring efficiencies.