KELER CCP Reports Outstanding Earnings

KELER CCP Central Counterparty Ltd., a provider of clearing house and guarantee undertaking services, achieved earnings well above the target: in an annual comparison, income has increased 20 percent, reaching HUF 472.5 million. The company kept costs under control, as well; operating expenses were 6 percent below the target values. The future growth of KELER CCP, which operates with 143 clearing members, is furthered by its cooperation established with the Kazakh stock exchange for provision of clearing services; the services are expected to go live by the end of the year.

KELER CCP Central Counterparty Ltd., a provider of clearing house and guarantee undertaking services, achieved dynamic growth in the first quarter of this year. A total income of HUF 472.5 million was reported in Q1, representing a 20-percent increase in an annual comparison. The company’s earnings before tax reached HUF 141.3 million, outperforming targets by 153 percent – according to a declaration by the company, member of the KELER Group owned by the Central Bank of Hungary and the Budapest Stock Exchange.

Well-performing markets, strict cost control

Károly Mátrai, CEO of KELER CCP commented on the Q1 performance: “More than 90 percent, that is HUF 436 million of the over HUF 472 million income came from the main activity. Income other than from the main activity exceeded HUF 36 million. Capital market income was as planned, but we realised HUF 10 million above the target income in clearing fees on the FX derivative market.”

KELER CCP performed well on the energy markets, too: it reported income HUF 30 million higher in total, in a quarterly comparison, and outperformed the income target by HUF 20 million on the Hungarian gas trading market. Generally, of key importance in the growth was the fact that KELER CCP increased the number of its clearing members compared to the end of last year: the company counted 143 clearing members at the end of Q1 this year.

Károly Mátrai also emphasised that KELER CCP continued to operate under strict cost control. “This is seen in the fact that operating expenses and expenditure in Q1 were 6 percent below the targets. A major part of expenditure still consists of the fee for infrastructural services payable to the other group member, KELER, wage expenses, and software support expenses”, the CEO added.

Promising outlook

KELER CCP is expected to continue this growth path this year and the next period, Károly Mátrai anticipates. Among this year’s service developments, he mentioned that KELER CCP has started preparations for serving the new MTF platform required for trading corporate bonds, launching on 1 July 2019 on the Budapest Stock Exchange. Another development was that, in March KELER CCP and its parent company, KELER Central Depository Ltd., signed a clearing service agreement with the Kazakh stock exchange (AIX). Under this partnership, Kazakh securities will be cleared by KELER CCP under European legislation, thus ensuring international acceptance for the Kazakh market. The cooperation established with the Kazakh stock exchange is a great opportunity for launching and testing the Hungarian infrastructures operated by the KELER Group on international stage, while it also creates good business opportunities for KELER CCP and KELER. The Kazakhstan service is expected to go live at the end of the year, following which it can also contribute to the long-term development of the KELER Group. According to its long-term strategy, KELER CCP continues to seek opportunities for international expansion. In the medium and long term, KELER CCP’s goal is to become the leading clearing service provider in the region.