.

StockMarketWire.com
Citigroup has downgraded its recommendation on ICAP (LON:IAP) to "neutral" from "buy" believing there to be insufficient upside potential to justify a continued buy recommendation. The City broker has increased its share price target slightly to 330 pence from 320 pence. Broker Forecasts consensus data highlights that 75 per cent of brokers have a neutral rating on the stock with 17 per cent at buy and 8 per cent at sell. Analysts at Citigroup commented: "ICAP shares have re-rated in the recent market rally up 10% since the beginning of December 2012. We continue to view ICAP as the best structurally positioned IDB. However, at ~10x 13E, considering the limited earnings growth in a low visibility volume environment, we think the upside is not adequate.

StockMarketWire.com
ICAP (LON:IAP) notes recent press coverage. As previously disclosed, ICAP has been asked to provide information to various agencies investigating the setting of Libor and is cooperating with those inquiries.

As part of the FSA's inquiries, one of ICAP's interdealer broker subsidiaries has been notified that it is the subject of an FSA investigation. The investigation is confidential, accordingly no further comment will be made at this stage.

StockMarketWire.com
Interdealer broker ICAP said trading conditions for the quarter to end- December remained challenging with a pronounced slowdown volumes in December.

For the third quarter, Group revenue was 13% lower compared with the same quarter the previous year.

Activity levels in January, however, improved across the business, including a 17% year-on-year increase in electronic broking volumes.

The cost saving programme remains on track to deliver more than £50 million in the current financial year and at least £60 million of annualised cost savings by the year end. Consequently, ICAP expects pre-tax profits for the year to 31st March 2013 to be within the current analyst range of £280 million to £305 million.

Michael Spencer, Group CEO, said: "While December was even slower than expected, we've seen a marked improvement in trading volumes since the beginning of January across our entire business, although it is premature to tell if this is the start of a more sustained upturn. Our balance sheet remains strong and our cost reduction programme remains on track. Despite the challenging market environment we continue to innovate and develop our business. Next week we will launch i-Swap, our electronic interest rate swap platform, in the US. This will build on the success of our market leading Euro platform. We have received positive feedback from customers on the many changes we've made at EBS and our new service, EBS Direct, is progressing well. In Post Trade, we've successfully expanded our customer base and product portfolio with a number of new initiatives.

"We remain well positioned for the opportunities that regulatory changes in the market landscape will bring. The push towards more electronic trading and risk mitigation of OTC derivatives plays to our strengths as we have invested in developing the services and technology that our customers will need to meet the new regulatory requirements."

Numis note today:
"The Department of Justice and the CFTC are looking at the role of ICAP and RP Martin in relation to LIBOR. People close to the investigation say. "While neither firm has been accused of wrongdoing, regulators allege that some of their employees were crucial in helping specific traders rig submissions by banks of estimated borrowing costs in different currencies." (Wall Street Journal). We cannot know if either ICAP or any of its employees have done anything wrong. We continue to believe that it is unlikely that ICAP will have to cut its dividend. While we see no evidence so far that the LIBOR scandal will materially negatively impact ICAP until this is resolved we can see no reason to own the shares which are valued at our top of the range profit estimate at a forward multiple of 10.6x earnings.

LIBOR: The group has net debt of £82m before any fines are imposed. We assume this won’t happen but if the regulator decides that there is operational risk within ICAP it could call the CRD waiver into question. A worst case scenario would be the removal of the CRD waiver and that could mean a rights issue before the capital needs for a SEF. In this scenario ICAP have said that they could move their domicile to Singapore. This would not remove the requirement for an increased amount of capital to be held in their UK and US subsidiaries. The UK and the US businesses are key to ICAP. Their business is strategically important and conducted with the too big to fail banks in both markets. We are not sure that regulators demanding capital to protect against operational risk would be satisfied by just moving the head office.

Outlook: We continue to believe that the trading environment has improved for ICAP and the revenue comps for ICAP are easy going forward. Regulation will require ICAP to inject cash into its SEF and the full impact of Basle III will not impact banks until 2019. Consequently, the banks are expected to continue to shed prop trading (client facilitation) activity. The point ICAP becomes a Buy (LIBOR aside) is when you believe US interest rates will be expected to go up, which looks to be coming closer. At that point we believe every income line of the group will see substantial growth. Unfortunately that still appears to be some way off but it is now not unreasonable for the market to be looking in that direction. We believe ICAP remains a key part of the global financial plumbing and consequently do not believe that the model is broken."

StockMarketWire.com
Interdealer broker ICAP said trading conditions remain extremely challenging. Revenue for the year to end-March is expected to be 13% below the prior year.

The start to the year benefitted from increased levels of issuance and volatility, with changes in Japanese monetary policy helping to drive higher electronic FX volumes. The increased activity levels seen in January and February have not continued at the same rate in March. The cost savings programme remains on track to deliver at least £60 million of annualised savings by the year end. Group revenue for the year ending 31 March 2013 is expected to be 13% below the previous year. Consequently, ICAP expects pre-tax profits for the year to 31st March 2013 to be around £280 million, in line with the lower end of the guidance provided in the Interim Management Statement on 7th February 2013.

Michael Spencer, Group CEO, said: "While we had a better start to the fourth quarter, we are not yet seeing a sustained upturn with market activity remaining fragile and unpredictable. This is caused, in part, by the continued lack of clarity around new regulatory requirements and the impact they may have. Our cost savings programme has delivered as we had forecast. ICAP today is a more efficient organisation than a year ago. We also continue to invest in new platforms, products and services which I believe will drive our growth over the next two years."

Results for the year ending 31st March 2013 will be released on 14th May 2013.

StockMarketWire.com
Interdealer broker ICAP said group revenue decreased by 12% to £1.472bn in the year to end-March, with profit before tax down 20% to £284m.

Electronic Markets and Post Trade Risk and Information contributed 66% of operating profit.

Key developments include the creation of the Global Broking division, the strengthening of EBS and the launch of i-Swap in US dollars.

£60m cost savings were delivered this year, £10m more than previously announced. Equates to £80m annualised, £20m higher than previously announced.

Group operating profit margin was 21% (2011/12 - 22%).

EPS (adjusted basic) was down 18% to 33.0p; Statutory EPS (basic) down 68% to 6.7p.

Ongoing free cash flow was £274m (2011/12 - £268m), representing a profit conversion of 130% resulting in net cash of £25m (2011/12 - net debt £82m).

ICAP proposed a final dividend of 15.4p per share. The full-year dividend of 22.0p per share (2011/12 - 22.0p), reflects the continuing strong cash generation and confidence in ICAP's medium-term prospects.

Michael Spencer, Group CEO, said: "This has been an extraordinarily tough year in the wholesale financial markets. Trading activity across all asset classes was negatively affected by a combination of cyclical and structural factors including the depressed global economy, a low interest rate environment and lack of clarity around some aspects of regulatory reform. ICAP's financial performance reflects these extremely challenging conditions.

"Despite the current climate, we're keeping our focus on the long term, delivering on our strategic goals and priorities. We're investing, innovating and adapting the business to ensure it will thrive in the new financial landscape that is being shaped by profound regulatory changes. Wholesale financial markets are vital to the global economy and ICAP plays a critical role in increasing the transparency and efficiency of the markets and reducing risk.

"ICAP continues to benefit from its diversified business and global reach. Our electronic, post trade risk and information businesses now contribute 66% of operating profit. We have deepened our relationships and aligned our interests with our customers by partnering with them in i-Swap and Traiana.

"We have exceeded our annualised cost savings target by £20 million, resulting in expected annualised run-rate savings of £80 million and a more flexible cost base going forward. ICAP remains a profitable and a very cash generative business with a strong balance sheet. Today we are a more efficient and collaborative business than we were a year ago and this will stand us in good stead for the future.

"We (UBS) upgrade ICAP to Neutral on valuation grounds and as we see upside to volumes. The stock has significantly underperformed financials and exchanges by 36% and 30% over the past year. This underperformance has been driven by a relative de-rating and weak earnings momentum.
We see risks to the upside on both fronts as the FICC volume cycle is noticeably improving (Our IDB volume proxy is up 9% m/m and 6% y/y in May and investment banks have been positive).
We remain cautious on the IDBs as we expect structural pressures on banks and thus on intermediaries to remain elevated. (1) OTC clearing is live in the US since March and goes live in Europe in Q2-14; this will increase the cost of trading swaps materially and also lead to volumes moving to futures, (2) European banks still have 5-10% deleveraging to do, (3) consolidation in FICC is set to continue among I-Banks which will reduce the need for intermediation.
We increase our EPS estimates by 2% in FY14E and by 2% in FY15E mostly to reflect a better cyclical outlook. Although we see further upside risks should volumes continue to improve.
We increase our SOTP-based PT to 340p to reflect higher earnings expectations and a better mix of earnings. We value voice broking on 8x P/E and the electronic/post trade businesses on 13x (vs 7x and 12x previously).

StockMarketWire.com
ICAP - a leading markets operator and provider of post trade risk mitigation and information services - has signed a £425m multi-currency revolving credit facility, incorporating an $200m swingline facility.

The facility has a final maturity date of 1 December 2016 and will be used for general corporate purposes, including the refinancing of the existing $880m facility.

Banc of America Securities and HSBC Bank were appointed to arrange and coordinate the syndication of the facility. In addition to the two coordinating banks, ICAP further strengthened its banking group by mandating J.P. Morgan, Lloyds Banking Group, The Royal Bank of Scotland, Commerzbank and Citibank as mandated lead arrangers and bookrunners. Bank of New York Mellon was an arranger.

Going Ex. divi this week, paying an impressive 15.4p-4.04%.

Some drop on Ex.divi with this one 33.20p.. nearly 9%!

Canaccord note today:
"ICAP’s 1Q trading statement reveals:
1Q revenue up 2% on last year. Encouraging start but trading conditions remain challenging (e.g. BrokerTec volumes rose 13% but the uplift in revenue reflected volume discounts). Mixed performance across ICAP’s businesses (e.g. strong performance from financial futures and options; fall in CDS and commodities).
Management’s current expectations for the full year remain unchanged. The default Quest value of 279p a share reflect the cash return on invested capital over the past decade and consensus forecasts, which are in our view unnecessarily pessimistic. At 400p a share ICAP shares are up 30% year-to-date and are trading on a dividend yield of 5.5%. While this is attractive and ICAP’s cash generation is strong, the payout ratio is high. We see the dividend as being sustainable but see little prospects for growth.
We maintain our 300p price target (set in November 2012) and change our recommendation from hold to SELL

Fined 54 Million http://www.bbc.co.uk/news/business-24250750

Ex-divi wed 2nd July 2014 (15.4p).

Just gone long on IAP ICAP, lovely break through downtrend channel and coming off a recentish bottom.

StockMarketWire.com
ICAP (IAP.L), the markets operator and provider of post trade risk mitigation and information services, has reported that Group revenue for the half year to 30 September 2014 is expected to be 10% lower than the previous year on a constant currency basis.

It will be 15% lower on a reported basis.

Restructuring of its global broking division remains on-track to deliver a more focused business and annualised savings in excess of £60m. Of this, £40m will be realised in the current year's income statement, principally in the second half of the year.

Accordingly, the phasing of full year profits is expected to be more heavily weighted to the second half than in comparison to prior years.

Michael Spencer, the Group's chief executive officer, said: "Market conditions remain challenging, but we are increasing the efficiency of the Group while continuing to innovate.

"Low volatility levels and a focus by our clients on costs and regulation resulted in execution volumes remaining suppressed during much of the period.

"There was some good improvement to client activity in September, as central bank actions led to an increase in foreign exchange and interest rate volatility pushing average daily volumes on EBS to more than $100bn per day for the first time in 12 months. While I do not expect a linear recovery, this provides a basis to be guardedly optimistic about future market activity.

StockMarketWire.com
ICAP's group revenue decreased by 9% on a constant currency basis (15% on a reported basis) to £620m in the six months to the end of September.

Trading operating profit for the six months was £100 million, down 26% on a constant currency basis and 34% on a reported basis, reflecting a combination of weaker trading volumes and the on-going investment in new initiatives. During the period the Group invested £29 million (including £8 million capitalised; £7 million in the prior year) in new business lines including EBS Direct, ICAP SEF, triCalculate and Traiana Limithub, an increase of £10 million compared to the corresponding period last year.

These new businesses have started to make significant progress, with EBS Direct seeing volumes reach a single day high at $28 billion in late September. In addition, TriOptima grew triResolve clients to more than 1,250 from 670 a year ago and Traiana extended CreditLink services for buy-side firms trading on SEFs; successfully launched CCP Connect for Equities and expanded TR Connect to cover multiple reporting jurisdictions. Investment in these initiatives is expected to continue over the remainder of the financial year, albeit at a slower rate.

The group says it has responded to the challenging market conditions in Global Broking by restructuring the business, redesigning compensation packages and retrenching from business lines which had limited growth potential. Profit before tax was £86 million, down 38% on the prior year with a strong performance by the Group's associates and joint ventures offsetting the slightly higher finance costs as a result of refinancing the €300 million Eurobond ahead of its redemption in July. Statutory profit before tax was £36 million, net of £22 million of exceptional costs related to the restructuring programme.

Separately, ICAP announced that it is in discussions to combine ICAP Shipping with Howe Robinson Group Pte Ltd, the leading shipbroking group to create one of the world's leading businesses in the sector. The newly formed ship-broking company is expected to be operational in the second quarter of 2015.

The combined entity will be well placed to meet the aspirations of its staff and to attract top class talent from across the industry. Howe Robinson and ICAP Shipping are highly complementary in terms of products and geographies. The combined entity will be able to better service the diverse needs of clients operating across multiple locations and market segments, now and in the future. Howe Robinson was established in London in 1883. It has since grown into one of the largest privately owned dry-cargo and containership broking houses in the world, with a global network of 6 offices, employing over 150 employees. ICAP Shipping became a leading force in the ship-broking sector in 2007 with the acquisition of JE Hyde, followed by the purchase of Capital Shipbrokers the following year. ICAP Shipping employs 196 people across 10 offices.

StockMarketWire.com
ICAP (IAP.L), a leading markets operator and provider of post trade risk mitigation and information services, has commented on today's decision of the European Commission (EC) to issue a fine of £11.3m.

This allegation relates to Yen Libor and is based on the same underlying matters that ICAP Europe, a subsidiary of ICAP's Global Broking division, settled with the Financial Conduct Authority (FCA) and the U.S. Commodity Futures Trading Commission (CFTC) in September 2013.

ICAP does not accept the EC's decision, which it believes is wrong both in fact and in law. This is a regulatory matter that has already been settled.

It says it is not a competition issue, and the EC has presented no evidence that ICAP facilitated a competition law violation. ICAP will be challenging this decision at appeal in the European Courts.

StockMarketWire.com
ICAP, a leading markets operator and provider of post trade risk mitigation and information services, saw signs of improvement in the third quarter after a challenging first half.

Group revenue for the third quarter to 31 December was 1% lower than a year ago on a constant currency basis and 2% lower on a reported basis.

In December, ICAP announced its strategic plans to combine its electronic businesses EBS and BrokerTec.

The combined business, known as EBS-BrokerTec, will allow ICAP to leverage BrokerTec's market leading platform, client relationships and strong team, as well as EBS's technology and innovation pipeline, to deliver unique products and services to the industry and expand the addressable market of both platforms under the leadership of Gil Mandelzis.

Mandelzis has been CEO of EBS since March 2012 and founded Traiana, a provider of post-trade and risk management services acquired by ICAP in 2007.

Electronic Markets delivered low double digit revenue growth in the third quarter underpinned by significantly increased activity levels at EBS, which saw its highest monthly average daily volume (ADV) since February 2013 as all currency pairs benefited from the uptick in volatility.

The Bank of Japan's bond buying announcement on 30 October drove near record levels of volumes in dollar/yen, as did the recent removal of the cap by the Swiss National Bank in euro/Swiss franc.

Recent structural growth in non-deliverable forwards and offshore Chinese renminbi has continued. Customer interest in EBS Direct remains strong with over 100 new customers in the pipeline to be on boarded. EBS Direct is in an investment phase as additional functionality and services are added to the platform. Trading activity on the BrokerTec platform was mixed with strength in US Treasuries partly offset by weakness in Repos.

Low double digit revenue growth was also achieved by the Post Trade Risk and Information division in the third quarter, a reflection of the positive return from the ongoing investment in the business and the strong demand for TriOptima's compression (triReduce) and portfolio reconciliation (triResolve) services. In December, TriOptima completed its first compression cycle in the Japanese Securities Clearing Corporation and more recently announced that it will be collaborating with CLS Group to deliver an FX forward compression service. Traiana's Harmony network has benefited from the recent increase in FX activity. Performance at Reset continues to be hindered by the lack of short-term volatility.

As previously highlighted, a combination of factors including low interest rates, flat yield curves and bank deleveraging have all impacted the performance of Global Broking. In response to structural changes in customer demand, the division has refocused its priorities towards franchises where it has market leading positions and as a result has closed unprofitable desks and operations. Although Global Broking revenues declined by 8% during the period (on both a constant currency and on a reported basis) excluding the businesses that were exited, this decline was 4%.

Global Broking is investing in areas where it has market leading franchises such as OTC European Interest Rate Derivatives, which has benefited from rising volatility and continues to develop hybrid and electronic trading offerings such as i-Swap and other matching platforms.

The group says it remains focused on delivering its cost savings programme and is on track to reach the target of £43 million for the current year and at least £60 million on an annualised basis. On 4 February ICAP confirmed that it intended to challenge at appeal in the European Courts the European Commission's decision to issue a fine of £11.3 million in relation to Yen Libor.

Group chief executive Michael Spencer said: "After a challenging first half, we have witnessed welcome signs of improved market activity in a number of areas, notably in FX. Moreover, we have seen the benefits of the significant investment in our exchange-like electronic platforms, EBS and BrokerTec, as well as in our Post Trade risk reduction services. We are committed to grow our addressable markets and strengthen the position of our innovative businesses. We are also making good progress with our restructuring programme. While we see signs of increased activity in some markets we continue to remain cautious as conditions in Global Broking remain challenging. "We are confident our strategy will position ICAP to deliver future growth. Our cash generation remains strong and we will continue to balance the need to invest in growth opportunities with returns to our shareholders."

got these and doing well.,.

StockMarketWire.com
ICAP, a leading markets operator and provider of post trade risk and information services, posts a trading operating profit of £252m for the year to the end of March - down from £290m last time.

Revenues fell by 7% to £1,276m and trading profits before tax fell by 15% to £229m. The statutory pre-tax profit of £95m was down from £121m a year ago.

Group chief executive Michael Spencer said: "The past year has been one marked by both challenges and opportunities across many of our businesses. Our bank customers have re-prioritised their sales and trading franchises and continued to reduce balance sheet risk. Our regulators continued their important work for market efficiency, embracing greater transparency and tighter, more risk averse financial systems.

"Against this backdrop of a transformed market environment, we have re-balanced our portfolio of assets with our Electronic Markets and Post Trade Risk and Information divisions now contributing three quarters of the Group's profitability. We have materially re-engineered ICAP, with a significant reshaping of our Global Broking division and the merging of EBS and BrokerTec. We have had some excellent successes with EBS Direct, the new emerging currencies on EBS, and in our Post Trade Risk and Information division with risk reduction services from TriOptima. These factors, combined with our ongoing investment in technology-based innovative solutions, have set us on the path to growth.

"As a result of the changes we've made, ICAP is better placed to capitalise on the opportunities available and better able to serve a broader range of customers. ICAP is profitable and cash generative. We will continue to invest in people, training, technology and systems to ensure we have the right skills, remain innovative and agile, and grow our business."