Exclusive FNG… FNG has learned that London-based Retail FX and CFDs broker 4T Markets Limited posted a net loss of £300,000 in its financial year 2023 (year ended 31 March), its first full year of operations under its new name.
As also reported exclusively here on FNG, the FCA licensed MT4/MT5 broker officially known as Formax Prime has been acquired and rebranded as 4T Markets in early 2022. The broker’s new url is 4t.co.uk, with a sister offshore entity in Seychelles operating website 4t.com.
Formax Prime was a broker founded in the middle of the last decade by Chinese businessman Xi Wang. Formax set up operations (with licences) in various jurisdictions, including the UK, mainly targeting HNW traders, but never really took off. The company was sold last year to UK-based businessman Waqas Mahmood through his holding company Regalis Trading Solutions Limited. 4T Markets has brought on board former SquaredFinancial CEO Youssef Barakat to head the group’s offshore operations.
4T Markets almost doubled its Revenue during FY2023 to £236K (from £119K the previous year), but increased costs led to a larger loss of £300K in 2023 (2022: £271K), as noted above.
The principal activity of the company is to act as an agent intermediary to its clients who wish to use the company’s electronic trading platform to trade in the financial markets, and in particular in over-the-counter (OTC) foreign exchange instruments.
During the period from 1 April 2022 to 31 March 2023, 4T Markets Limited continued to implement its business plan and completed the first full financial year of operation following the company’s rebranding in Q4 2021.
Senior Management oversaw a complete website overhaul completed in the second quarter of 2022, incorporating fully automated customer onboarding capabilities. Trading for retail clients in floating point forex has resumed and the company continues to provide white label technology services to other brokerages, including trading platform management and compliance support. Providing such services ensures that the business has a steady monthly revenue stream.
Delays in the implementation of the business plan have been and continue to be due to many different factors, such as the current difficult market conditions, uncertainty in the financial markets, and although not as severe as in previous years, there are still negative effects of the COVID pandemic -19 and also the uncertainty surrounding the new rules related to the regulation of financial services after Brexit.
The IFPR which came into effect in 2022, increased the company’s Permanent Minimum Requirement (PMR) from core capital of €125,000 to £190,000 from 1 January 2023. As there is no matched principal exemption under the IFPR, the company will move to a PMR of £ 750,000 over a 5-year period starting in 2022. Shareholders have injected additional capital to meet the minimum capital requirement and senior management will ensure that the company is adequately capitalized during the 5-year transition period to comply with the new regime.
4T Markets senior management is working to ensure that the implementation of the revised business plan is on track given the aforementioned delays. Shareholders have funded 4T Market with sufficient capital to meet not only the minimum regulatory capital required for the company to comply with FCA requirements but also working capital requirements, and will continue to do so to ensure that it can maintain the business until it is profitable and can operate organically with its own resources.
After relaunching its operations, 4T Markets targets a range of clients, from high net worth individuals to professional and institutional investors, with extensive knowledge of the trading industry. The company has always been a customer-driven organization and treating customers fairly is ingrained in its culture. Employee behavior towards customers is governed by company policies and FCA requirements.
4T Markets is controlled by British businessman Waqas Mahmood, through his holding company Regalis Trading Solutions Limited. The broker, which operates primarily from the UK and Lebanon, focuses on an Arabic-speaking customer base.
Following is the income statement and balance sheet of 4T Markets Limited for the year 2023.