Moscow Exchange (MOEX) nnounces its financial results under International Financial Reporting Standards (IFRS) for the year ended December 31, 2014. Operating income was up 23.5% YoY to RUB 30.39 billion.
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Operating income growth for the year was driven by an increase in fees and commissions in FX, Equities and Money Markets, as well as increased interest income and strong Depository and Settlement Services fees.
Securities (Equities & Bond) Market. Fee and commission income from the Equities Market rose 25.8% YoY to RUB 1.77 billion. Total trading volume in 2014 was RUB 10.28 trn, up 18.1% YoY. The equity market's total capitalisation was RUB 23.2 trn (US$ 385.9 billion) by year-end 2014. Fee and commission income from the Bond Market declined 25.0% YoY to RUB 1.03 billion. Total trading volume in 2014 was RUB 10.6 trn, down 30.8% YoY.
Listing and other services fees increased 61.0% to RUB 351.03 mln.
FX Market. Fee and commission income from the FX market increased 41.3% YoY to
RUB 3.41 billion. Trading volumes on the FX market totalled RUB 228.5 trn, up 46.5% YoY. Thanks to elevated volatility, spot trading volumes rose 35.8% YoY, while swap trading volumes increased 52.7% YoY on the back of high demand for liquidity-management products.
Money Market. Fee and commission income from the Money Market increased by 27.8% YoY to RUB 3.24 billion. Total trading volume on the Money Market including repo transactions and deposit and credit market declined 7.4% YoY to RUB 204.38 trn, largely due to a move to 1-week repo auctions with the CBR instead of 1-day repo, which led to a lower number of repo trades, though with longer maturity.
Derivatives Market. Fee and commission income from the Derivatives Market increased 4.5% YoY to RUB 1.64 billion. The trading volume in contract terms increased 24.6% YoY and amounted to 1.41 billion contracts totalling RUB 61.32 trn, largely driven by FX derivatives. Open interest reached RUB 457.3 billion by year-end 2014, a 17.3% YoY increase. The growth shows increasing depth of the market thanks to new players, and also reflects the elevated volatility of FX rates.
Depository and Settlement Services. Fee and commission income from depository and settlement services increased 37.3% to RUB 3.19 billion. The volume of assets on deposit at the NSD increased to RUB 24.94 trn as of 31 December 2014 from RUB 21.77 trn at the end of 2013, and averaged RUB 22.82 trn for 2014.
Other Revenue. Other revenue remained flat and amounted to RUB 966.90 mln. The biggest contributors to this line are revenue from the sale of software and technical services (RUB 496.17 mln) and revenue from the sale of market data (RUB 436.17 mln, up 44.8%).
Interest & Other Finance Income. Interest and other finance income increased 21.5% YoY to RUB 14.28 billion due to a significant increase in funds available for investments and higher interest rates.
Cash and Cash Equivalents. Moscow Exchange's cash position1 at year-end 2014 totalled RUB 57.65 billion. The Exchange had no debt as of 31 December 2014.
Expenses. Operating expenses in 2014 grew by 5.2% YoY to RUB 10.37 billion, more than two times lower than Russia's inflation rate. Personnel expenses remained the major cost item, comprising 52.0% of total costs. Administrative and other operating expenses declined by 1.0% YoY in 2014 due to lower spending on professional services, market makers and taxes, other than income tax.
Capital expenditure for FY 2014 totalled RUB 784 mln, of which RUB 530 mln was spent on software purchases and development. ■