Ex-only platform Selftrade parent writes down £35m of wrap’s value

Execution-only platform Selftrade’s parent Boursorama has written down the value of Selftrade by around €42m (£35.1m) because of regulatory demands and delayed IT migration.

We revealed in January Selftrade had suspended taking on new customers on its platform after voluntarily varying its permissions following discussions with the FSA. This suspension remains in place.

Selftrade has in excess of 200,000 accounts and around £4bn of assets under administration.

The writedown, which came as part of Boursorama’s third quarter projected results, show the group recorded “exceptional impairment costs” of €63m of which two thirds relates to Selftrade.

The remaining third relates to German business OnVista.

A statement from Boursorama says: “Boursorama Group will record exceptional impairments of goodwill and other intangible assets related to Selftrade. These impairments can be explained by the combination of several factors:

“A more demanding compliance framework requires additional investments, particularly in the finance and risk services. Also, regulatory changes in the United Kingdom have induced new rules for managing client money deposits, leading thus to reduced net interest margin.

“For Selftrade specifically, a delayed IT migration in third-quarter 2013 generates additional costs.

”Lastly, the anticipated growth in the retail brokerage market has not materialised in the relevant countries, as measured by the number of orders executed. As Selftrade and OnVista generate a significant part of their net banking income from this activity, the planned business growth assumptions have been revised downward.”