Multi-asset brokerage Saxo Bank has been cleared of three more cases by the Danish Maritime and Commercial High Court following the events of January 15, 2015. The cases date back to the unexpected move by the Swiss National Bank (SNB), which removed the exchange floor under the EUR/CHF, convulsing FX markets and resulting in sizeable moves for CHF pairs.
Saxo Bank’s Group CFO, Steen Blaafalk, said to Finance Magnates: “It was regrettable that the removal of the peg of the Swiss franc versus the euro back in January 2015 led to significant losses for many investors. It was a historically big move in a major currency and January 15 2015 was not a good day for a number of our clients and hence not a good day for Saxo Bank.”
The verdict follows an earlier decision by the court back in November 2016. By scoring a key legal decision, a precedent was seemingly laid that helped chart a similar outcome for Saxo Bank in subsequent cases, including today’s clearance of two unresolved cases.
This forward-thinking synopsis appears to have been realized with Saxo Bank’s verdict from the Danish court today. Of note, the Danish Maritime and Commercial High Court is a unique institution as the judges are selected specifically for each case. Three of the judges are regular judges, while the remaining two are experts in the field that is being disputed by the parties.
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“It is unfortunate to meet a client in a courtroom, but we are pleased that the court’s decisions once again are in line with our expectations, and that we now have the court’s word in range of cases that we acted in accordance with our business terms,” explained Mr. Blaafalk.
“But it is important for us to emphasize that we have followed standard practice for extreme market situations like the one in January 2015 ensuring clients as objective prices as possible.”
The 2015 SNB crisis represented one of the most trying times for the FX industry in recent memory – the episode proved especially stressful for Saxo Bank given that many banks which had been providing liquidity to the group collectively pulled out of the market. Consequently, trading systems were put under tremendous pressure since such an event had never before been witnessed.
In a key nod to any future cases facing Saxo Bank: “The Danish Complaint Board of Banking Services has also concluded in Saxo Bank’s favor saying that Saxo Bank has acted in a way that was fair and correct, and in accordance with the bank’s general terms of business. And further concluding that the corrected prices contributed to reach the, under the circumstances, best results for clients,” noted Mr. Blaafalk.
“Furthermore, the Danish FSA concluded after a thorough investigation in 2015, that Saxo Bank’s calculations of corrected prices were not in conflict with investor protection legislation or Saxo Bank’s obligations to act fairly and professionally towards our clients,” added Mr. Blaafalk.