Latest update on Alpari (UK) Limited in Special Administration 

KPMG released an update regrading Client Claims and Client Money Pool (“CMP”) of Alpari (UK) Limited.

The Joint Special Administrator’s released the following:

•  CMP Illustrative Financial Outcome as at 8 April 2015
•  Valuation of Swiss currency pair trades

CMP Illustrative Financial Outcome

The CMP Illustrative Financial Outcome includes a low and high case for the CMP as well as the current expected interim distribution level.  It is important to note that the CMP Illustrative Financial Outcome shows the range from low to high, this is not the same as “worst” and “best” as not every adverse contingency is included in the low case, nor is every positive outcome included in the high case.

Currently no illustrative financial outcome has been released for the house estate.  This is due to a number of continuing uncertainties that will have an impact on the house estate. An equivalent house illustrative financial outcome will be released in due course.

Pricing of trades

The prices at which clients’ trades were closed on the 15 and 16 of January 2015 is a major determining factor in the total Client Claims and, therefore, the expected outcome of both the CMP and house estate. The paper released, “Valuation of Swiss currency pair trades”, outlines the methodology by which CHF trades will be treated.  The treatment of non‐CHF trades has been
summarised previously (as detailed in the document “12.3.15 – Clients’ and Creditors’ Meeting Presentation” on the website).

The same pricing treatment will be applied to positions held by creditors and debtors.

The Joint Special Administrators expect to be able to release access to the Claims Portal for the great majority of clients who had open CHF trades by 30 April 2015.  A small minority of clients with open CHF trades will be further delayed from accessing the Claims Portal while some remaining data integrity issues are resolved by the Joint Special Administrators.

Declaration of Intention to distribute funds from the CMP 

The Joint Special Administrators propose to declare prior to 30 April 2015 an intention to distribute funds from the CMP (the “Declaration of Intention”). FCA consent will be sought by the Joint Special Administrators prior to making the Declaration of Intention.

The Declaration of Intention will set a final soft date for clients to agree claims within the 28 days following the Declaration of Intention (“Final Date for Agreement”). Clients who have agreed their claims by the Final Date for Agreement will receive a first interim dividend on the date of the first interim distribution of the CMP. The precise amount of the first interim dividend will be calculated as close to the date of the first interim distribution as operationally possible to allow it to be maximised. An indication of the current distributable amount is given in the “CMP Illustrative Financial Outcome as at 8 April 2015”.

Clients who agree claims after the Final Date for Agreement will not be prejudiced by the earlier payment of interim distributions to clients who have already agreed their claims.  Regular payment runs will be performed after the first interim distribution date to bring those clients who subsequently agree claims to the same cumulative distribution level as other agreed clients.

We are in discussions with the FSCS with a view to harmonising the payment of dividends from the CMP with the payment of FSCS compensation to those clients who choose to assign their agreed claims to the FSCS.  We will make further announcements in respect of this in due course.

Source: Insolvency-kpmg

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