There is about to be one less player in the Russian foreign exchange (forex) market as Promsvyazbank, an FX dealer, is preparing to submit an application to the country’s central bank to voluntarily revoke the licence of PSB-Forex LLC.
On Wednesday PSB-Forex, the FX subsidiary of Promsvyazbank, said in a statement that it would be terminating its activities after less than four years of operations, which have been plagued with weak financial performance.
PSB-Forex Struggled since the Beginning
The announcement from PSB-Forex follows after three and a half years of operations, with the broker losing money ever since commencing its operations and only a small active trader client base.
In fact, in its full-year 2019 financial statement, the company’s auditor gave them a going concern warning because of the continued losses. So, the fact that the forex dealer is going to revoke its licence is not completely unexpected.
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Russia’s FX Market Shrinks Even Further
Once PSB-Forex stops operating in Russia’s FX market that will bring the number of licensed forex dealers down to three. All of the remaining players are part of larger banking groups.
In a statement on its website, the FX dealer said on Wednesday (translated): “PSB-Forex LLC hereby notifies of the decision taken by the Sole Participant of PJSC Promsvyazbank to refuse to carry out the activities of a forex dealer.
“At present, PSB-Forex LLC is preparing to submit an application to the Bank of Russia for the voluntary cancellation of the Bank of Russia license to operate a forex dealer. We ask you, by September 30, 2020, to send LLC PSB-Forex a written Notice of termination of the Framework Agreement.”
With the deadline set for 30th September 2020, clients need to close all of their open positions before the day of its termination and no later than five working days before the expected date of termination.
“If you fail to fulfill the above obligations, the written ‘Notice of termination of the Framework Agreement’ received from you is recognized as an application to close all open positions and an order to withdraw funds from a special section of the client’s nominal account to the bank account specified by the client in the Framework Agreement,” representatives of the subsidiary of Promsvyazbank added.