LSE Ups its Stake in LCH, Sees Uptick in Revenue for Q3
- The exchange operator is likely to control over 80 percent of the clearing house by the end of the year
The London Stock Exchange (LSE) released its financial results for the third quarter of 2018 this Friday. Alongside those results, which saw the firm increasing its year-on-year revenue, the stock exchange operator also released a statement saying that it has upped its stake in the London Clearing House Group (LCH).
According to the results released by the LSE this Friday, the exchange saw its revenue grow from £443 million ($576.76 million) in the third quarter of last year to £464 million (£604.10 million) in the third quarter of this year. That was equivalent to a five percent year-on-year increase.
That growth was largely a result of an increase in revenue in the firm’s information services division. Last year, the LSE reported total third-quarter revenue for its information services division of £182 million ($236.95 million). This year, that figure grew to £212 million ($276.01 million) - a 17 percent increase.
LCH Inflow to LSE
On top of its own revenue, the LSE also received an inflow of cash from its stakes in the LCH and CC&G. Both companies providing clearing and Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term services and income from their operations saw the LSE rake in £57 million ($74.21 million) over the course of the third quarter of this year. That was a 36 percent increase on last year’s £42 million ($54.68 million).
As a result of that additional £57 million, and an additional £1 million in “other income,” the LSE saw a total income of £522 million ($679.61) for the third quarter of this year - an eight percent increase on last year’s £486 million ($632.74 million). After taxes, the firm had a net profit of £465 million ($605.40 million) - also an eight percent increase on last year’s £430 million ($559.83 million).
LSE ups its Stake
Outside of those financial results, the LSE also announced that it had upped its stake in the LCH. The exchange operator has gradually been increasing its majority stakeholder position in the Clearing House Clearing House A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e Read this Term over the past few years.
On this occasion, the LSE has upped its stake by an additional 15.1 percent - meaning it now controls over 80 percent of the company. According to a statement released by the LSE on Friday, it will pay up to a maximum of €438 million (£384 million) for that 15.1 percent share in the company.
A number of minority stakeholders will be selling their entire share in the LCH as a result of the group. The LSE listed Borsa Istanbul, CFT & Viel & Cie, Commerzbank, Deutsche Bank, Nasdaq, and Nomura as the companies it is buying out.
On top of this, a number of companies - Bank of America Merrill Lynch, Barclays, JP Morgan, Morgan Stanley, and Societe Generale - will be selling some of their stake in the firm.
Funding for the acquisition will come from the LSE’s cash and existing debt facilities at closing and will be accretive to earnings following completion. Assuming it gets the regulator’s nod of approval, the acquisition is likely to be completed by the end of 2018.
The London Stock Exchange (LSE) released its financial results for the third quarter of 2018 this Friday. Alongside those results, which saw the firm increasing its year-on-year revenue, the stock exchange operator also released a statement saying that it has upped its stake in the London Clearing House Group (LCH).
According to the results released by the LSE this Friday, the exchange saw its revenue grow from £443 million ($576.76 million) in the third quarter of last year to £464 million (£604.10 million) in the third quarter of this year. That was equivalent to a five percent year-on-year increase.
That growth was largely a result of an increase in revenue in the firm’s information services division. Last year, the LSE reported total third-quarter revenue for its information services division of £182 million ($236.95 million). This year, that figure grew to £212 million ($276.01 million) - a 17 percent increase.
LCH Inflow to LSE
On top of its own revenue, the LSE also received an inflow of cash from its stakes in the LCH and CC&G. Both companies providing clearing and Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term services and income from their operations saw the LSE rake in £57 million ($74.21 million) over the course of the third quarter of this year. That was a 36 percent increase on last year’s £42 million ($54.68 million).
As a result of that additional £57 million, and an additional £1 million in “other income,” the LSE saw a total income of £522 million ($679.61) for the third quarter of this year - an eight percent increase on last year’s £486 million ($632.74 million). After taxes, the firm had a net profit of £465 million ($605.40 million) - also an eight percent increase on last year’s £430 million ($559.83 million).
LSE ups its Stake
Outside of those financial results, the LSE also announced that it had upped its stake in the LCH. The exchange operator has gradually been increasing its majority stakeholder position in the Clearing House Clearing House A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e A clearing house is defined as an intermediary between two parties, a buyer and seller, which helps facilitate the overall process from trade inception to settlement. Clearing houses streamline the exchange of payments, securities, or derivatives transactions.The clearing house is situated between two clearing firms who also helps reduce the risk of either member firm failing to honor their respective trade settlement obligations.Buyers and sellers enter into legally binding agreements for the e Read this Term over the past few years.
On this occasion, the LSE has upped its stake by an additional 15.1 percent - meaning it now controls over 80 percent of the company. According to a statement released by the LSE on Friday, it will pay up to a maximum of €438 million (£384 million) for that 15.1 percent share in the company.
A number of minority stakeholders will be selling their entire share in the LCH as a result of the group. The LSE listed Borsa Istanbul, CFT & Viel & Cie, Commerzbank, Deutsche Bank, Nasdaq, and Nomura as the companies it is buying out.
On top of this, a number of companies - Bank of America Merrill Lynch, Barclays, JP Morgan, Morgan Stanley, and Societe Generale - will be selling some of their stake in the firm.
Funding for the acquisition will come from the LSE’s cash and existing debt facilities at closing and will be accretive to earnings following completion. Assuming it gets the regulator’s nod of approval, the acquisition is likely to be completed by the end of 2018.