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PILLAR 3 DISCLOSURE

AT GLOBAL MARKETS (UK) LIMITED “PILLAR 3” DISCLOSURE IN ACCORDANCE WITH MIFIDPRU 8 AND PART EIGHT OF THE CAPITAL REQUIREMENTS REGULATION

CONTENTS

  1. Overview
    1. Introduction
    2. Scope and Frequency of Disclosures
  2. Governance Arrangements
    1. Internal Governance
    2. External Directorships
  3. Own Funds
    1. Composition of regulatory own funds
    2. Own funds: main features of own instruments issued by the firm
  4. Own Funds Requirements
    1. K-Factor Capital Requirements
    2. Risk Management Framework

  1. Overview

    1. Introduction

      AT Global Markets (UK) Limited is an investment firm authorised and regulated in the United Kingdom by the Financial conduct Authority. As a MiFID 2 investment firm, AT Global Markets is subject to the FCA’s ‘MiFIDPRU’ regulatory capital regime. These rules are based on three regulatory ‘pillars’. Pillar One imposes a minimum capital requirement which is determined according to the nature and scale of the risks to which a firm is exposed in the course of its business. Pillar Two provides for an evaluation by a firm and its regulator of any additional capital that should be held in addition to the Pillar One minimum. Pillar Three seeks to establish market discipline through the disclosure of core information about a firm’s capital position. The rules governing the Pillar Three disclosure are set out in MiFIDPRU 8. AT Global Markets (UK) Limited discloses information under these where it is relevant to the company’s business unless it is considered by the Board of Directors to be proprietary or Confidential information. Where information is not disclosed for this reason we will make reference to that fact. Quantitative information shows the position of the firm as of 31st October 2022 and is shown with a level of detail that is appropriate to the nature, scope, and complexity of the Firm’s activities.

    2. Scope and Frequency of Disclosures

      AT Global Markets (UK) Limited is regulated by the Financial Conduct Authority as a ‘solo’ entity. This disclosure relates only to that company. In accordance with Article MiFIDPRU 8.1.10, information is disclosed annually on the date when the Company publishes its annual financial statements. The Company operates as broker/dealer of FX and Contracts for Differences. The Company undertakes a full review of its Internal Capital Adequacy and Risk Assessment (pillar two) at least once per year. This document has been prepared solely to meet the legal requirements of MiFIDPRU 8 and must not be relied upon in making any judgement about the Company. The Company uses only the standard methods provided under MiFIDPRU. It does not have approval to use internal models for the purpose of measuring and allocating capital to credit or market risk. Consequently, this document does not contain any disclosures relating to the use of internal models. This report has been prepared to coincide with the publication of the Firm’s audited financial statement. All figures reflect the position of the firm at that date as shown in the audited financial statements for the year ended 31st October 2022

  2. Governance Arrangements

    1. Internal Governance

      ATFX has implemented a comprehensive governance, control and risk management framework proportionate to the nature and scale of the Firm’s business. The Board of Directors is the main governance body of the Firm and is responsible for the overall direction and control of its affairs and for ensuring that robust internal controls are in place to identify, monitor and manage the risks inherent in the business. The Board of Directors has established three sub committees- CARC (Compliance, Audit, Operation and Risk), Remuneration and Product Governance. These sub-committees report directly to the Board. The Board also receives reports on all other areas of the business. The Board delegates day-to-day responsibility for the implementation of its policies to the executive directors who are supported by the Senior Management team.

    2. External Directorships

      Two of the Firm’s directors hold directorships outside the ATFX group: Hiu Keung Li holds 4 other appointments. Weiqiang Zhang holds 1 other appointment.

  3. Own Funds

    1. Composition of regulatory own funds

Source based on reference numbers/letters of the balance sheet in the audited financial statements

ItemAmount (GBP)
1
Own Funds
7,628,517
2
Tier 1 Capital
7,398,953
3
Common Equity Tier 1 Capital
7,398,953
4
Fully paid up capital instruments
8,734,158
Called up share capital
6
Retained earnings
(1,335,205)
Profit and loss reserves
26
Fully paid up, directly issued capital instruments
229,564
Note 14 (Other Creditors)

    2. Own funds: main features of own instruments issued by the firm

The Firm’s own funds are comprised mainly of Ordinary shares (shown as fully paid up capital instruments above). The Firm also has a subordinated loan from its parent undertaking (shown as Fully paid up, directly issued capital instruments above).

  1. Own Funds Requirements

    1. K-Factor Capital Requirements

      As at 31st October 2022, the Firm’s risk based ‘K-factor’ capital requirements were:

      K-AUM + K-CMH + K-ASA    =   £2,000

      K-COH + K-DTF                  =   £17,000

      K-NPR + K-CMG + K-TCD + K-CON =   £545,000

    2. Risk Management Framework

      AT Global Markets (UK) Limited has an established risk management framework through which the Board of Directors identify and manage the risks to which the Company is exposed. The risk management framework forms an integral part of the overall internal capital adequacy assessment process, The Firm has progressed well through its business development phase in the last five years. The Directors also anticipate a profit in the next fiscal year. This represents a firm foundation from which the Firm is now seeking to develop its business. In particular, the Firm is seeking to develop its risk capacity which this is likely to be beneficial to both the Firm and the client. Broker/dealers operating within the FX/CFD sector are generally exposed to market risk and credit risk. As a result of proactive regulatory interventions across the sector, the risk to which the Firm’s retail clients can become exposed is now significantly lower than was once the case. The Directors believe that the most significant risk facing the Firm in the foreseeable future will be market risk. Market risk arises on mismatches between internalised transactions and as a result of holding operating balances in currencies other than its currency of account. The Firm seeks to manage the market risk by diversifying its portfolio of exposures. Where unacceptable concentrations of risk arise, or where client transactions exceed the Firm’s risk appetite, exposures are hedged in the underlying market. The Board of Directors has determined that the overall benefit of holding assets in the currencies required for operational reasons outweighs the risk of mark to market variations in their value. Accordingly, it has determined that no further mitigation of this risk is appropriate. Because of the nature of its business model, the Company has limited exposure to credit risk in its trading book. The bulk of its on trading book assets are held in high quality banks.
 

V.12023