Freedom Holding plans to include bank in its Ukrainian structure in 2021

Freedom Holding, one of the largest retail brokers in Ukraine and in the CIS countries, has been working to include a bank in its structure in Ukraine since 2019 and hopes that this process will be completed this year, CEO and majority shareholder Timur Turlov said.

"To establish a large broker, we need a bank in Ukraine. There are specific plans and specific companies, there is a goal. We have been working on this deal for almost three years. I hope that in 2021 the process will be completed and the bank will appear, we will develop as a clearing bank, which will allow it to be more active as an investment bank," he said at the webinar for Ukrainian clients.

Turlov said that the bank also plans to launch a modern card product and provide clients with direct access to money in brokerage accounts.

The Chief Executive Officer of Freedom Holding said that the licensing process in Ukraine is the most difficult in his professional practice. "The only thing that calms down is that hardly anyone will repeat it," Turlov said.

According to him, the company is ready to capitalize the bank to the size necessary for its tasks.

"It is very important for us to close the transaction with the bank. As soon as it is closed, it will allow us to go further," the CEO said.

Turlov also said that overall Freedom Holding is "certainly very pleased" with the business results it has in Ukraine, in particular the very high demand for transparent market investment instruments, and intends to maintain its leadership as one of the largest retail brokers.

"I would like to recoup $1 million spent on the construction of the branch infrastructure," the CEO said, once again noting that Ukraine is "one of the most difficult jurisdictions in terms of building relationships with various regulators."

Turlov also recalled that the other day Freedom Finance Ukraine, a member of the holding, received an underwriter license and intends to actively engage in this activity. According to him, the company intends to start with the lowest-risk segment – large business and companies, and will try to attract foreign clients to such placement, using its advantages as an international broker.

"If there is an interesting instrument, then we can easily bring hundreds of millions of dollars. If a bank appears, we will do it faster," the CEO said, adding that in Kazakhstan, Freedom Finance was the second underwriter in 2020, and this year it intends to become the leader.

According to him, in the future, the investment group will be ready to consider the launch of digital life and property insurance in Ukraine. At the same time, Turlov pointed out that while Freedom Holding will not be in a hurry with this direction in Ukraine, since there are already many good products on the Ukrainian insurance market, and the company must first become strong in those areas where it is already represented.

Freedom Finance Ukraine is part of Freedom Holding Corp., whose brokers provide customers with access to global stock markets. The holding also includes a Russian broker and Freedom Finance Bank, JSC Freedom Finance (Kazakhstan), Freedom Finance Cyprus Limited, Freedom Finance Germany TT GmbH, Freedom Finance LLC (Uzbekistan).

In the third quarter of 2021 fiscal years, which ended on December 31, 2020, Freedom Holding's revenue grew 3.4 times, to $100.2 million, net profit by more than 10 times, to $42.3 million. The total number of client accounts was almost 350,000. Holding was represented by 78 offices in the countries of presence.

Freedom Finance Ukraine has established offices in 12 cities of Ukraine and since the end of 2018 has opened more than 2,500 new accounts in the country's market. In 2020, in the course of an additional issue of shares of the Ukrainian Exchange, Freedom Holding became its largest shareholder with a share of 24.39%.

Source: www.en.interfax.com.ua