MarketSpreads to reopen after Central Bank lifts suspension

MARKETSPREADS IS to reopen after the Central Bank lifted its suspension of the spreadbetting firm’s trading licence.

The Central Bank, which regulates spreadbetting companies in Ireland, ordered the Dublin-based organisation to cease trading on April 5th.

It followed the collapse of UK-based WorldSpreads plc, the firm that was originally MarketSpreads’ parent company and from which MarketSpreads split in 2009.

The Central Bank ordered MarketSpreads to cease trading, citing “capital adequacy and audit opinion issues”.

The issues in question covered the period immediately before MarketSpreads’ current owners bought the business from its previous shareholder, WorldSpreads.

In a statement, MarketSpreads said it “has now dealt with the legacy financial issues that had caused concern to the Central Bank and has reopened with a stronger capital base”.

It is believed that the Central Bank’s concerns centred on two issues: the qualified audit opinion that accompanied the company’s 2009 accounts, and capital adequacy issues.

It is understood both have been addressed, with the company filing its 2010 accounts this week and enhancing capital adequacy through new investment and other funding measures, such as the conversion of a loan into preference shares in the group.

MarketSpreads will be open for business from 11pm tomorrow evening.

No fine has been imposed on the company by the Central Bank to date.

The company thanked its customers, who it said had been “very supportive through what was a difficult period”.

“Client funds have been, and will continue to be, 100 per cent safe, intact and properly segregated,” the company said in a statement.

The management of MarketSpreads bought the business from WorldSpreads in December 2009.

Two of the leading figures in the buyout, former executives Brian O’Neill and Fergus Rice, left MarketSpreads last year after the board discovered that they had transferred €1.4 million of the company’s funds to another business in which they were involved.

Both Mr O’Neill and Mr Rice recently agreed to judgments against them in the High Court for €1.68 million – the principal sum plus interest.

WorldSpreads’ operations are under special administration in Britain after its board discovered a £13 million (€15.95 million) shortfall in client funds.