The CySec issues a report on the consequences of the Swiss franc's volatility

The Cypriot financial regulator issued a statement regarding the consequences of extreme volatility in the forex following the Swiss National Bank's decision to remove the EUR/CHF's 1.20 price floor.

To determine the impact on the adequacy of investment firms' cash holdings, the CySec collected data from all brokers holding a CIF license. The data show that 158 of the 182 regulated investment companies in Cyprus have not suffered a negative impact on their own funds. The remaining 24 brokers reported losses that have not had any material impact on their own funds, and the solvency ratio remains above the required minimum.

The total loss suffered by the affected brokers is about €42.5 million. It was primarily due to the negative balances on customers' accounts due to leverage and price corrections due to prices offered by liquidity providers on 15 January 2015.

The CySec states that forex brokers in Cyprus will seek to recover the above-mentioned losses and, because of the problems faced by investment firms in other countries, a slight increase in activity was observed among Cypriot brokers in recent days.