Report on Placement - Dukascopy Bank Sa

...

The Dukascopy project itself was launched back in the year 1998 by a group of physicists ruled by the company’s present main shareholder and managing director, Dr. Andrey Duka. They were focused on the research and development of complex financial systems using mathematical and econophysical techniques. On 2 November 2004, after six years in development, Dukascopy Bank SA was established to offer the financial markets industry its cutting edge technology solution. The company was registered as a Société Anonyme, the French equivalent of a Joint Stock Company (JSC), a form of company that involves two or more individuals, which own shares of stock in the business. It is worth mentioning that all broker companies in Switzerland must obtain a Swiss Banking License. Back in 2010, Dukascopy Bank became the second Swiss Forex broker approved by the Swiss Financial Market Supervisory Authority FINMA to perform banking activities.

Currently, Dukascopy Group consists of the following companies fully owned and directly controlled by Dukascopy Bank SA, its Swiss parent company located in Geneva:

- Dukascopy Europe IBS AS – an EU licensed brokerage company established in 2011 in Riga, Latvia, which is regulated by the Financial and Capital Market Commission of Latvia (FCMC). Obtaining an EU license allows a broker to serve private and institutional clients across the European Union. On a basis of White Label Agreement executed between Dukascopy Bank SA and Dukascopy Bank Europe, the Riga-based company is obliged to provide its clients with equal access to Swiss foreign exchange markets.

- Dukascopy Japan K.K. – a Type-1 licensed broker company acquired by Dukascopy Bank in 2015 that was previously known as Alpari Japan K.K. The subsidiary is located in Tokyo, Japan, and is regulated by the Financial Services Agency of Japan (JFSA).

- SIA Dukascopy Payments – an EU licensed transfer and e-money company founded in 2015 in Riga, Latvia, which is regulated by the Financial and Capital Market Commission of Latvia (FCMC).

At the moment, Dukascopy Group employs approximately 300 full-time employees with an agency in Zürich and representative offices in Riga, Kiev, Moscow, Hong Kong and Kuala Lumpur.

-

External environment and industry overview

The brokerage industry is a highly competitive market, where companies compete on the basis of service, relationships and price. Dukascopy Bank’s mission is to strive continuously being the leader of fair and transparent Forex industry, as in current complex and fast changing environment, the Bank believes that the Forex market seeks an honest trading approach. Dukascopy stands out among all other retail forex brokers as it:

- Offers high liquidity and reliability, as the Bank is regulated by FINMA and supported by the largest liquidity providers, including Barclays, Currenex, Deutsche Bank, JP Morgan, Goldman Sachs, Citibank, HSBC Bank and others.

- Provides account holders with a greater degree of protection issued by the Government of Switzerland (in case of the Bank’s bankruptcy).

- Operates under stricter regulations than ordinary forex brokers, inasmuch as Dukascopy is a Swiss bank.

- Provides own-developed cutting-edge trading technology.

- Offers some of the most attractive spreads in the industry, ranging from 0.5 to 1.0 pips.

- Treats all clients in a fair honest and transparent manner, in accordance with the Bank’s Philosophy of Transparency

Furthermore, to successfully compete in this volatile business industry, Dukascopy provides the opportunity for banks and other regulated financial institutions to offer FX electronic trading services to their own clients under the Bank’s White Label Program. Currently, Dukascopy partners with the following companies:

- Dukascopy Europe IBS AS

- Dukascopy Japan

- Minsk Transit Bank

- Moscow Industrial Bank is

- Baltikums Bank AS

- vPE Bank AG

- AFT FX

- Tbilisi Traders Club LLC

- Forex Financial Services Pty Ltd

- NSFX

- PFX Financial Professionals LTD

- Atom8

Back in October 2010, due to changes in US regulation, Swiss forex brokers were forced to stop accepting US retail forex clients. To satisfy its clients, Dukascopy Bank developed partnerships with the most famous and reputable brokers in the United States, in order to allow US clients to continue using and trading with Dukascopy Bank’s technology, mainly JForex platform.

-

Corporate structure

It can be said that Dukascopy, in its management style, does nоt differ from a lot of other compаnies in the industry. All subsidiaries and representative offices owned by Dukascopy Bank SA operate with the permission of the parent company located in Geneva, Switzerland. This approach helps Dukascopy Bank SA to ensure that all operations achieve the Bank’s оbjectives in an effective and efficient way. Since the world changes constantly, this direct management control style allows Dukascopy to be flexible and open to change. Nevertheless, each representative office of Dukascopy has its own executive management team, which is respоnsible for all operations running in the particular branch-office.

Dukascopy Group Management is divided into two levels. The first level is the Board of Directors that currently consists of a Chairman, Vice-Chairman, who is in charge of Audit Committee Duties, and three other members. All Board members are permanent residents and citizens of Switzerland.

The second level is the Executive Management Team, which consists of Dr. Andrey Duka, the founding shareholder of Dukascopy, who serves as the Chief Technology Officer (CTO), Chief Executive Officer (CEO) and Co-Chairman of the Board; Veronika Duka, also the founding shareholder, who serves as the Chief Executive Officer (CEO), Chief Administrative Officer (CAO) and the Co-Chairman of the Board; Dmitry Kukel, who serves as the Chief Brokerage Officer, and Laurent Bellières, who serves as the Chief Financial and Chief Risk Officer (CFO, CRO). All executive officers are permanent