Pillar 3 Disclosure January 2021
Eiger Trading Advisors Limited was incorporated on the 16 June 2008 and is authorised and regulated by the Financial Conduct Authority (FCA), FRN 487788 and a Category 5 member of the London Metal Exchange (LME).
The information is set out in accordance with the EU’s Capital Requirements Regulation (EU575/2013 (CRR) articles 431-455 (Disclosure by Institutions).
The information is based on Eiger’s financial position as of 30 September 2019 and are in Eiger’s base currency, US Dollars. This information is not subject to audit except where they are equivalent to those contained in Eiger’s audited financial statements. Information has not been included where it is not considered to be applicable or where advantage has been taken of one of the exemptions under Article 433 of the CRR. The document is available on Eiger’s website.
i. The Board
Eiger’s Board consists of one Executive Director and two Non-Executive Directors. Eiger is their only UK Directorship.
Executive Director & CEO
Non- Executive Director
ii. Board Recruitment and Diversity
The recruitment of new Board Members is subject to the approval of the Board. Potential new Board members are evaluated based on their experience, skills and knowledge including industry knowledge. Eiger recognises the need to have a diverse work force and any new board members are recruited only on the factors above.
iii. Risk Oversight and Committees
There are several potential risks and uncertainties, which could have an impact on the company’s long-term performance and could cause actual results to differ materially from expected and historical results. The company’s risk management policies and mitigating actions are discussed below.
i. Geo‑political risk
Adverse political conditions affecting the business environment in any of the company’s core countries in which its clients operate could have a material impact on the company’s performance. The company constantly looks to diversify its client base across multiple jurisdictions to mitigate this risk.
ii. Market Risk
The Company owns and holds quantities of commodities. The price risk is hedged using derivative instruments to limit a gain or loss. The firm has a capital resource requirement in respect of its foreign currency position risk requirement of $2k on 30 September 2019 (2019 ‑ $3k).
iii. Interest Rate Risk
The Company does not have any long-term borrowings or loans and therefore is not overly exposed to interest rate risk.
iv. Liquidity Risk
The Company seeks to always maintain sufficient funds in readily accessible accounts with its bankers to meet its liabilities when they fall due. In addition, in accordance with the FCA rules the firm maintains capital equivalent to the greater of one quarter of its estimated projected annual fixed overhead expenditure or $643k to ensure that the firm’s affairs could be wound up in an orderly manner should the need arise. There is no current intention or expectation for such an eventuality. The relevant figure to be maintained is kept under regular review.
v. Foreign Exchange Risk
The functional currency of the company’s trading activities is the USD. At present foreign exchange risk arises on the translation of its GBP Sterling overheads into USD. The Board has appointed a committee that actively monitors the company’s future foreign exchange requirements and has put in place a hedging strategy.
vi. Credit & Counterparty risk
The company employs the standardised approach to credit risk. The firm has a capital resources requirement in relation to credit risk of $221k on 30 September 2019.
The company employs the simplified method of assessing risk weighted exposure amounts and does not employ ratings agencies in connection with this exercise.
i. 30th September 2019
The company’s own funds as of 30 September 2019 as set out below in the financial statements for year-end 2019.
Permanent Equity Capital
Share premium account
Total Tier 1 Capital
ii. Capital instruments
The Company’s own funds consist of Common Equity Tier 1 items within the meaning of Article 26 of the CRR. Tier 1 Capital is issued and fully paid-up ordinary shares and retained earnings.
The Company follows the standardised approach and as an FCA Limited Activity Firm, calculates the Fixed Overhead Requirement in accordance with Article 97. The Fixed Overhead Requirement as of 30 September 2019 was $643k.
Following the guidance in SYSC19A of the FCA Handbook, The Company is a Proportionality Tier Four Firm. NFC’s policies have been designed to comply with the Tier 4 requirements.
The document has been prepared to meet the requirements of the EU CRR regarding the disclosures of matters in Part 8 of the CRR. This disclosure generally contains information about capital requirements and about the management of risk relating to those requirements and for no other purpose. It therefore does not constitute any form of contemporary or forward-looking record or opinions.