Fallout from the Swiss central bank's surprise move to ditch the franc's cap against the euro spread to Queen St yesterday, with an Auckland-based currency brokerage announcing it was shutting down as a result of losses sustained.

Global Brokers NZ operates the Excel Markets currency trading system, which it launched in 2013.

In a statement posted on the Excel Markets website, director David Johnson said most of its clients holding franc positions were on the losing side and had had losses far greater than their account equity.

The Swiss National Bank, which in 2011 set the cap on the value of the safe haven currency against the euro, when the European debt crisis was at its height, said overnight Thursday that it was no longer required, prompting the franc to soar by as much as 30 per cent against the euro amid chaotic trading.

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"When a client cannot cover their losses it is passed on to us," said Johnson.

"[Global Brokers NZ] can no longer meet regulatory minimum capitalisation requirements of $1 million and will not be able to resume business."

Johnson said client funds were held in segregated accounts and all "positive equity or balance" could be immediately withdrawn.

"We are currently experiencing hundreds of withdrawal requests."

However, he said losses incurred on trades that could not be exited as a result of illiquidity - the inability to quickly sell an asset - would not be reimbursed.

"Please note that the inter-bank market for francs was illiquid for hours after the event and no traders with an open franc position were able to close it for a significant period of time," Johnson said.

"As directors and shareholders we would like to offer our sincerest apologies for this devastating turn of events, and to thank you for being such a supportive group."

In a 2013 blog post on the Excel Markets website, Johnson and co-founder Jason Peterson said "there can be little doubt that the Excel product will enjoy a level of success".

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A key advantage was its $200 minimum account, according to the post.

Global Brokers NZ was incorporated in New Zealand in November 2002.

In addition to Ireland-based Johnson, its other directors are Roger Bell, who lives in Auckland, and United States-based Arnold Sward.

Bell is understood to be in Hong Kong and could not be reached for comment, while a Global Brokers NZ employee said no management staff were available for interviews.

The Business Herald understands the company has five New Zealand-based staff and fewer than 100 clients in this country.

A staff member at the firm's Queen St office declined to comment when the Weekend Herald visited the premises yesterday.

It's unclear how many clients the company has overall, or how much cash they may have lost as a result of the franc's surge.

A Financial Markets Authority spokesman said Global Brokers NZ had operated as an authorised futures dealer under the Securities Market Act until November 30.

The company had applied for a derivatives issuer licence under the Financial Markets Conduct Act, which came fully into force on December 1.

"We are currently seeking a status update from [Global Brokers NZ] and we will be seeking assurances that the client funds have been protected and segregated as they have noted in their statement today," the spokesman said. "There is currently significant volatility in global currency markets and investors should be aware of these market risks.

"Licensed derivatives issuers must segregate client funds from their own trading operations.

"However, this does not prevent investors sustaining losses due to market events."

Currency speculators around the world, as well as hedge funds holding significant short positions on the franc, faced heavy losses.

- Additional reporting: Hamish Fletcher