Stay informed with free updates
Simply sign up to the Foreign exchange myFT Digest — delivered directly to your inbox.
Argentex, a UK-listed foreign exchange hedging specialist that suffered a liquidity crisis earlier this year, is appointing administrators, making it one of the highest-profile victims of the currency market volatility triggered by US President Donald Trump’s trade war.
The company, which had been trading on London’s junior Aim market until its shares were suspended last week for a second time, said it had resolved to appoint administrators for the group. It had already applied to put its regulated entity, Argentex LLP, into administration after failing to secure additional funding.
The company also said on Tuesday that Tim Rudman, who was appointed interim chief executive in April, had resigned.
Argentex provided currency hedging and exchange services to clients ranging from big companies to individual sportspeople, calling itself a “global expert in currency risk management”.
But it was forced to suspend its shares in April after suffering a “rapid and significant impact on its near-term liquidity position” from margin calls on its currency derivatives positions. That came after the dollar, which had been widely expected to strengthen, instead tumbled amid concerns over the fallout from Trump’s tariffs. Chief Jim Ormonde left the business shortly afterwards.
Argentex LLP had been operating for the past month under a special arrangement with the Financial Conduct Authority, which allowed it to continue servicing customers if it was able to raise extra liquidity.
But the company, which had hoped to secure a revolving credit facility, “has not been able to secure that additional funding, nor does the company have any other source of alternative funding or liquidity available to it”, it said in a statement last week.
It again suspended its shares, which had plummeted when trading resumed in May, taking its market cap to less than £5mn.
IFX Payments, whose takeover bid for Argentex had been approved by the latter’s shareholders last month, said on Monday that it was considering invoking an insolvency provision and cancelling the deal.
Part of the firm’s problems, according to two people familiar with Argentex’s strategy, was due to the use of so-called zero-zero trades, where Argentex would not demand either initial margin or a so-called variation margin from some corporate customers. This meant it could not typically offset margin calls from its banks by demanding collateral from customers. The trades were first reported by Bloomberg.
Argentex did not immediately reply to a request for comment. A spokesperson for FRP Advisory — the administrators for Argentex LLP — said its “primary objective is to ensure the return of safeguarded customer funds as soon as reasonably practicable, while customer funds remain subject to regulatory protections”.
“We have been engaging with the firm to seek to secure the best outcome for consumers,” said the FCA. “We will continue to monitor the situation as it progresses.”
Argentex LLP was placed into special administration under a 2021 regulation that creates a specific insolvency process for payment and electronic money companies.
Former chief and co-founder Harry Adams said on LinkedIn that he was “deeply saddened” by events at Argentex and called for a “thorough investigation” of the management of the company.