Saxo Bank reports lackluster earnings for 2022
Copenhagen-based broker, Saxo Bank reported lower revenues and net income for the fiscal year 2022 as customer trading activity dropped as compared with the previous year.
The FX bank has announced its financial results for the twelve months ending December 31, 2022. The multi-asset group marked a fall in its annual revenues, which came in at DKK 4.45 billion ($635 million), down 1.6 percent from DKK 4.52 billion for the same period last year.
As for the bottom-line metrics, Saxo Bank disclosed a net profit of DKK 711 million ($101.3 million), down 6 percent from DKK 755 million in 2021.
The net profit for 2022 was impacted by lower trading activity following the macroeconomic situation, which created uncertainty for clients who traded less, Saxo said. However, higher interest rates contributed positively to net interest income, partly offsetting the decrease from lower trading activity.
Meanwhile, Saxo Bank won more clients with total active accounts crossing 876,000 for the first time in the company’s 30-year history, mainly driven by its institutional business. Despite onboarding more than 56,000 from 2021, rounding off 2022 with a record high, total clients’ assets under custody decreased to DKK 584 billion compared to DKK 595 billion last year.
That drop was mainly driven by the decline in the equity market but partly offset by positive net funding from clients. However, the figure remains a record-breaking milestone for the Danish broker, which took 25 years to reach the DKK 100 billion mark and then only 4 years to add an additional DKK 490 billion in client assets.
Saxo completes BinckBank migration
Commenting on the results, Kim Fournais, CEO and founder of Saxo Bank, said: “Several significant macro factors impacted our 2022 results. On the positive side, rising interest rates contributed to a higher interest income, while declining stock markets meant Investors acted more cautiously, dampening our revenue growth. Over the course of 2022, we achieved a major milestone when finalising the migration of the BinckBank clients to Saxo’s platforms, and have further expanded many platform features, content, product lines and services to provide a more comprehensive and intuitive client experience.“
Saxo Bank added that the cost level remained almost unchanged, not least driven by the delayed completion of the BinckBank migration, which has added cost and complexity in running two parallel infrastructures. The cost/income ratio was also positively impacted by lower staff cost and a reduction in administrative expenses and marketing spend.
Saxo had completed integration with BinckBank, which it acquired in 2019, and the last segment of the Dutch lender’s clients was migrated in the second half. The transaction added more than 400,000 direct clients across four jurisdictions in the Netherlands, Belgium, France, and Italy.
The two companies have worked on the integration of their technology infrastructure over the last two years. They also plan to launch additional products and services to better compete in light of fierce competition in the online trading and investment sector.