COPENHAGEN, Jan 26 (Reuters) - Denmark’s Saxo Bank faces potential losses of up to $107 million as a result of the Swiss National Bank’s (SNB) decision to end its currency cap against the euro, the bank said in a statement late on Friday.
A number of Saxo Bank’s customers ended up with insufficient margin collateral to cover their losses on positions in the Swiss franc and some customers will not be able to settle the balance in full and the bank will incur losses in this respect, the bank said.
Taking the estimated maximum loss into account the total capital of Saxo Bank Group would be 2.15 billion Danish crowns ($324 million) while its total capital requirement is 1.71 billion crowns, the bank said.
Copenhagen-based Saxo Bank earned around two-thirds of its revenue from currency trading last year. The bank made a profit of 222 million Danish crowns ($33 million) in the first six months of 2014.
Losses from the surprise move by the SNB nearly crippled brokerage FXCM and IronFX is in talks to buy fellow online forex broker Alpari UK, which was forced into administration after suffering heavy losses on the Swiss franc.
$1 = 6.6361 Danish crowns Reporting by Ole Mikkelsen; editing by Jason Neely