Expensive suspension for Ireland's Marketspreads

Last year’s suspension of spread betting firm Marketspreads had a costly impact on the company’s financial results; Management noted this week in presenting new accounts.

The Irish spreadbetter was suspended by Ireland’s Central Bank for capital adequacy and audit opinion issues and, it now transpires, that was a contributory cause is pre-tax losses of almost a million Euros.

It may also have spurred the company management to rebrand to the new Shelbourne Markets title.

The new accounts filed with the Companies Office show that revenues dived 71 percent to Euro 1.89 million at the firm following the controversy, resulting in a pre-tax loss of Euro 991,060 in the eight months to the end of December 2012, a significant downward slide from a pe-tax profit of Euro 188,720 during the preceding year.

The Irish Independent reports that in their report, the directors wrote:

“The decrease in revenue is due to a shorter accounting period, a less volatile trading environment and the effect of the suspension of the company’s trading licence by the Central Bank on April 5, 2012.

“Since the suspension was lifted, the board and the company has focused on rebuilding client trading activities to pre-suspension levels in 2013”.

The suspension was lifted on April 27, 2012 following the restoration of capital levels.

In future, the company intends to focus on financial services and “migrate away from the betting model employed by UK peers.”