(Bloomberg) — Switzerlands financial markets regulator is looking into how Thursdays record surge by the Swiss franc impacted institutions as authorities worldwide assess how firms handled the fallout of the currency swings.
Finma is observing the situation and checking with some institutions on how they were affected, the regulator said in an e-mailed statement.
Banks and currency traders are tallying the fallout after the Swiss National Banks unexpected decision to jettison its cap on the franc sent the currency up as much as 41 percent against the euro. FXCM Inc., the largest U.S. retail foreign- exchange brokerage, said client losses threatened its compliance with capital ratios, and brokers in the U.K. and New Zealand were pushed into insolvency.
The Commodity Futures Trading Commission, the main U.S derivatives regulator, is reviewing the situation at FXCM, said Steve Adamske, a CFTC spokesman. The National Futures Association is in touch with the firm and CFTC, according to Karen Wuertz, an NFA spokeswoman.
The Securities and Exchange Commission is monitoring developments and discussing them with fellow regulators and market participants, said John Nester, a spokesman for the agency.
While the SEC doesnt regulate futures and commodity brokers, it would be interested in any impact the Swiss francs move had on businesses it oversees, including mutual funds that invest in currencies.
Hong Kong
The Hong Kong Monetary Authority said its looking into reports that local HSBC Holdings Plc customers were able to buy Swiss francs below market rates when the London-based lenders online banking system didnt keep up with the gains after the cap was scrapped. HSBC is looking into the matter, according to Maggie Cheung, a spokeswoman for the bank.
In London, currency broker Alpari U.K. Ltd. said it has entered into insolvency. Chris Hamilton, a spokesman for the U.K. Financial Conduct Authority, declined to comment on whether it will investigate the impact of the Swiss francs moves.
In New Zealand, the Financial Markets Authority is seeking assurance that client funds at Global Brokers NZ Ltd. were properly protected after the francs surge led the company to announce it would shut down, Reuters reported.
