TP ICAP Group Annual Report 2020

FY2020 Annual Report · TP ICAP Group
Loading PDF…
Modernising markets
Annual Report and Accounts 2020

2020 highlights

Revenue – reported
£m

£1,794m

7
5
7
,
1

3
6
7
,
1

3
3
8
,
1

4
9
7
,
1

Contribution
£m (APM)2

£680m

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

Operating profit (EBIT) – reported
£m

£178m

Operating profit (EBIT) – adjusted1
£m (APM)2

£272m

8
7
1

2
4
1

Operating profit (EBIT) margin – reported
%

9.9%

Profit before tax – reported 
£m

£129m

Basic EPS – reported 
Pence

17.2p

2
0
1

3
9

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

9
9

.

7
7

.

8
5

.

3
5

.

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

9
2
1

3
9

2
7

2
6

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

.

8
5
1

.

2
7
1

.

0
2
1

.

7
5
8
1
0
2

7
1
0
2

9
1
0
2

0
2
0
2

Operating profit (EBIT) margin – adjusted1
% (APM)2

15.2%

Profit before tax – adjusted1
£m

£223m

Basic EPS – adjusted1
Pence (APM)2

32.9p

1  Adjusted results represent the results excluding significant items.  

Please refer to page 34 of the Annual Report.

2  Alternative Performance Measures (‘APM’) are defined and explained 

on pages 200 to 202.

0
7
6

9
7
6

4
9
6

0
8
6

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

6
7
2

9
7
2

2
7
2

3
6
2

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

.

7
5
1

.

0
5
1

.

2
5
1

.

2
5
1

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

5
4
2

3
3
2

0
3
2

3
2
2

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

.

3
3
3

.

2
4
3

.

8
3
3

.

9
2
3

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

2020 highlights

Operational performance:
 > Delivered a solid financial performance, demonstrating our strong 

operational capability and the growing success of our diversification 
strategy, against the difficult macroeconomic backdrop and reduced 
secondary volumes in the wider interdealer broker market.

 > Revenue of £1,794m marginally declined 2% on a reported basis 

(1% at constant currency1).

 > Diversified revenue1 increased 6% (2019: 16%).
 > Reported operating profit was 25% higher than 2019. Adjusted was 3% 

lower, as lower revenues were only partially offset by tight cost discipline.

Dividend:
 > Interim dividend per share (DPS) of 4p (rebased to take into account the 
bonus element of the rights issue completed in February 2021) paid on 
6 November 2020.

 > Final dividend recommended of 2p due to be paid on 18 May 2021.
 > Total DPS in respect of 2020: 6p (rebased to take into account the 
bonus element of the rights issue completed in February 2021) 
(2019: 12p), a one-off 50% reduction year-on-year, to help fund 
the Liquidnet acquisition and minimise dilution of earnings 
on a per share basis.

1  Alternative Performance Measures (‘APM’) are defined  

and explained on pages 200 to 202.

 > Global Broking revenue decreased by 6% (5% lower at constant 

currency), as despite a strong first quarter, volumes shrunk as client 
appetite for risk decreased.

 > Energy & Commodities revenue increased 2% on a reported basis 
(3% higher at constant currency) with good growth in the majority 
of products, boosted by strategic hires.

 > Institutional Services revenue increased 21% on a reported and 

a constant currency basis, as the business benefited from investment 
in talent and enhanced asset classes and geographic coverage.
 > Data & Analytics revenue increased 7% on a reported basis (9% at 
constant currency), capitalising on the launch of new, higher-value 
products, whilst growing and deepening its client base. 

Strategic highlights:
 > Adapted our business quickly to manage the pandemic by deploying 

new workflows. Protecting our employees’ welfare enabled us to provide 
seamless client service, and to maintain a strong balance sheet.

 > Announced the transformational acquisition of Liquidnet, an electronic, 
buy-side focused trading network, expected to be completed by the end 
of Q1 2021, after the successful completion of our £315m rights issue.

 > Continued to invest in and execute our electronification and 

aggregation strategy, while diversifying and growing our non-Global 
Broking businesses.

 > Enhanced the enablers of our strategy, including a new Global Risk 
Framework and implementing a new ESG Reporting Framework.

Contents

Strategic report
Introduction
1 
2   At a glance
4   How we transact
6   Our business model
8  
Investment case
9   Board Chair’s statement
12   Chief Executive Officer’s review
18   Market factors
20   Strategy
26   Key performance indicators
28   Financial and operating review
43   Viability statement and going concern
44   Risk management
46   Principal risks and uncertainties
50   Environmental, Social and Governance
61   Section 172

Governance report
62   Compliance with the UK Corporate Code 2018 and section 172
64   Board Chair’s introduction to governance
66   Board of Directors
68   Corporate governance report
72   How the Board has satisfied its section 172 duty
81   Report of the Nominations & Governance Committee
84   Report of the Audit Committee
89   Report of the Risk Committee
92   Report of the Remuneration Committee
109  Directors’ report
113  Statement of Directors’ responsibilities

Financial statements
114    Independent Auditor’s Report to the Members  

of TP ICAP Limited

124  Consolidated Income Statement
125  Consolidated Statement of Comprehensive Income
126  Consolidated Balance Sheet
127  Consolidated Statement of Changes in Equity
128  Consolidated Cash Flow Statement
129  Notes to the Consolidated Financial Statements
183  Company Balance Sheet
184  Company Statement of Changes in Equity
185  Notes to the Company Financial Statements

189  TP ICAP Group plc Shareholder Information
191  Group undertakings
200 Appendix – Alternative Performance Measures
203  Appendix – Annual Report and Financial Statements  

of TP ICAP Group plc

212  Glossary

More about our performance and our business
 > Investor presentations
 > Latest news
 > Careers
tpicap.com

Cautionary Statement
This Annual Report has been prepared for, and only for, the sole member of 
the Company, as a body, and no other persons. The Company, its Directors, 
employees, agents or advisers do not accept or assume responsibility to any 
other person to whom this document is shown or into whose hands it may come 
and such responsibility is expressly disclaimed. By their nature, the statements 
concerning the risks and uncertainties facing the Group in this Annual Report 
involve uncertainty since future events and circumstances can cause results and 
developments to differ materially from those anticipated. The forward-
looking statements reflect knowledge and information available at the date 
of preparation of this Annual Report and the Company undertakes no 
obligation to update these forward-looking statements. Nothing in this 
Annual Report should be construed as a profit forecast.

Legal Statement
In December 2019, the TP ICAP Group announced its intention to put in place 
a new Jersey-incorporated, United Kingdom tax resident parent company by 
means of a scheme of arrangement pursuant to Part 26 of the Companies Act 
2006 (the Scheme). The Scheme became effective on 26 February 2021 and, 
as a result, TP ICAP Group plc became the new parent company of the Group. 

Shortly after the Scheme became effective, the former parent company of the 
Group, TP ICAP plc, changed its status to a private company and was renamed 
TP ICAP Limited. The Non-executive Directors (including the Chairman) of 
TP ICAP plc were also appointed as Non-executive Directors of TP ICAP Group 
plc with effect from the Scheme effective date (the Executive Directors were 
already appointed to the Board of TP ICAP Group plc). Members of the 
committees of the Board of TP ICAP plc were also appointed as members of 
the equivalent committees of the Board of TP ICAP Group plc on the Scheme 
effective date. 

As the Scheme became effective after the financial year ended 31 December 
2020, the financial statements included in this annual report are the 
consolidated financial statements of TP ICAP Limited, the parent of the Group 
as at that year end, rather than the consolidated financial statements of the 
current parent, TP ICAP Group plc. The financial statements of TP ICAP Group 
plc for the financial year ended 31 December 2020 (i.e. before the Scheme 
became effective and TP ICAP Group plc became the holding company of 
the Group) can be found in an appendix to these financial statements. 

The Directors have prepared the Annual Report of TP ICAP Limited as if 
it remained quoted on the date of approval on the financial statements, 
including the relevant disclosures required by the UK Listing Authority’s 
Disclosure Guidance and Transparency Rules (‘DTR’). With the exception of 
the Scheme, and TP ICAP Group plc becoming the new parent of the Group, 
the Group remains fundamentally unchanged and, therefore, there is no 
direct effect on the forward-looking, going concern and long term viability 
disclosures for the Group. The effect on the going concern assessment for 
the Company Only financial statements of TP ICAP Limited is disclosed 
on page 43.

Unless expressly set out or the context otherwise requires or suggests, 
references to ‘TP ICAP’ in this Annual Report, other than in the financial 
statements of TP ICAP Limited, are to TP ICAP plc before the Scheme became 
effective and to TP ICAP Group plc on and after the scheme became effective. 
Similarly, references to ‘the Group’ are to TP ICAP Limited and its subsidiaries 
before the Scheme became effective and to TP ICAP Group plc and its 
subsidiaries on and after the Scheme became effective.

Introduction

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

We are a global 
firm of professional 
intermediaries that 
plays a central role in 
the world’s wholesale 
financial, energy and 
commodities markets.

>  Our brokers match buyers and sellers 
of financial, energy and commodities 
products and facilitate price discovery, 
execution and risk management.
>  We provide independent data to 

participants in the financial, energy 
and commodities markets, including 
live and historical pricing content, and 
advanced valuation and risk analytics.
>  We are a trusted partner to our clients.

Annual Report and Accounts 2020
1

 
 
 
 
 
 
 
At a glance

Our brands
We operate a global portfolio of highly 
respected brands, each with a separate 
and distinct client offering.

Trusted worldwide
Our business is organised into four 
operating divisions across three regions. 
Our divisions have a portfolio of highly 
respected brands.

Americas revenue1

£670m

(2019: £687m)

EMEA revenue2

£888m

(2019: £900m)

Asia Pacific revenue3

£236m

(2019: £246m)

1.

2.

3.

Global Broking

Energy & 
Commodities

Institutional Services

Data & Analytics

Annual Report and Accounts 2020
2

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Our purpose
We provide access to global financial 
and commodities markets, improving 
price discovery, flow of liquidity and

distribution of data, working with and 
supporting the communities in which we 
operate and facilitating economic growth.

Our people
Our people utilise their skills and 
experience, combined with a strong 
technology offering, to work in close 
partnership with a diverse range 
of clients.

We continually enhance our services and 
our operations as our clients’ needs and 
preferences change and as markets and 
the regulatory environment evolve.

Our vision
To be the most trusted and respected 
data and market execution provider

in the financial, energy and commodities 
markets in which we transact.

Our values
How we conduct ourselves as individuals 
and as a Group is as important as the 
products and services we provide.

We want to have a business culture that 
allows us to serve our clients in the best 
possible way, and holds up to the most 
intense scrutiny. 

Our values, which underpin everything 
we do, are: Honesty, Integrity, Respect, 
Excellence.

Annual Report and Accounts 2020
3

 
 
 
 
 
 
 
How we transact

Oil
It’s January and Brian is looking to buy a 
plane ticket to Portugal in August for his 
summer holiday. The airline sells the 
ticket to Brian for £200.

Mortgages
Sophia is moving house and wants to get 
a five-year fixed rate mortgage.

To fly Brian there in August the airline needs to spend money on 
fuel. Rather than run the risk of the price of fuel increasing by the 
time the plane takes off in August, the airline fixes the price of fuel 
now in January. 

She finds a good deal from her bank who give her a mortgage 
to help her buy her new home.

TP ICAP
To get a fixed price for the fuel the airline uses a derivative. TP ICAP 
helps the airline’s bank buy that derivative at the best price.

TP ICAP
To protect themselves from potential interest rate rises, the bank 
buys a financial product to help them hedge their risk (an interest 
rate swap). They use TP ICAP to get the best price for this interest 
rate swap.

In August Brian jets off to Portugal.

Sophia moves into her new home. 

Annual Report and Accounts 2020
4

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

FX
Motion car company, based in the UK, 
needs to ensure it has enough steel to 
meet demand for its cars over the next 
year. The price of steel is in US Dollars.

Financial Information
Rosie has a pension with ABC Pension 
Fund managers and receives a statement 
every year. This statement sets out the 
value of all her pension fund assets.

Motion is worried that the US Dollar might increase in value over 
that time. Motion want to have certainty about the US Dollar price 
it will pay for the steel so it goes to its bank to get a fixed price.

To provide an accurate value, ABC Pension Fund needs financial 
information and market prices on everything Rosie owns. ABC 
Pension Fund gets this information from financial data providers.

TP ICAP
Their bank uses TP ICAP to buy a foreign exchange derivative that 
fixes the price of US Dollars compared to the pound. 

TP ICAP
The financial data providers have in turn been provided the 
information from TP ICAP. TP ICAP has a rich supply of financial 
data from tens of thousands of transactions we execute every day. 

Motion have certainty over the 
price of steel and is able to meet 
production demand. 

ABC Pension Fund provides an up-to-
date pension fund statement for Rosie.

Read more about how we transact in our business model 
on pages 6 and 7. 

Annual Report and Accounts 2020
5

 
 
 
 
 
 
 
Our business model 

 Who we are

 How we are organised 

We operate at the centre 
of global wholesale 
OTC and exchange-
traded markets. 

We provide broking 
services, including 
facilitating price 
discovery and execution, 
to counterparties 
operating in the world’s 
major wholesale OTC 
and exchange-traded 
ﬁnancial and 
commodity markets. 

We also provide 
independent data and 
analytics products to 
participants in the 
ﬁnancial, energy and 
commodities markets, 
including live and 
historical pricing 
content, as well as 
advanced valuation 
and risk analytics. 

Our business is organised into ﬁve divisions, across three regions 
(Americas, EMEA, Asia Paciﬁc).

Within our client-facing divisions we have a portfolio of highly 
respected brands, each with a separate and distinct offering.

Data & Analytics
Our Data & Analytics division provides 
unique data sets and neutral pricing 
information of OTC products to enable 
clients to analyse, record, trade and 
manage their portfolios. In 2020, 
Data & Analytics generated 8% of total 
Group revenues. 

Corporate Centre
Our Corporate Centre division provides 
support staff and infrastructure to our 
business divisions, including technology, 
compliance, risk management, ﬁnance, 
HR, legal and other essential services. 

Global Broking 
Our Global Broking division services 
markets in Rates, FX & Money Markets, 
Emerging Markets, Equities and Credit 
products. In 2020, Global Broking 
generated 65% of total Group revenues. 

Energy & Commodities 
Our Energy & Commodities division 
services markets in oil, gas, power, 
renewables, other energy-related products, 
precious and non-precious metals and 
soft commodities. In 2020, Energy & 
Commodities generated 22% of total 
Group revenues. 

Institutional Services
Our Institutional Services division provides 
broking and execution services to a range 
of institutions such as asset managers, 
hedge funds and insurance companies. 
In 2020, Institutional Services generated 
5% of total Group revenues.

Where we operate

Americas

£670m

Revenue
(2019: £687m)

EMEA

£888m

Revenue
(2019: £900m)

Asia Pacific

£236m

Revenue
(2019: £246m)

Annual Report and Accounts 2020
6

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

 What we do 

 How we do it 

 The value we create for

Broking 
Through electronic, voice and hybrid 
broking protocols, we facilitate the 
development of liquidity and price 
discovery in global ﬁnancial markets. 
We act as an intermediary between 
buyers and sellers of ﬁnancial products, 
enabling them to trade efﬁciently and 
effectively. We carry out our broking 
activities according to three main models: 

 > Name Passing 

Approximately three quarters of the 
Group’s broking revenue is derived from 
Name Passing activities, where the 
Group identiﬁes and introduces buyers 
and sellers who then complete the 
transaction between themselves. In 
respect of Name Passing businesses, the 
Group’s risk exposure is limited to the 
collection of commission from its clients.

 > Matched Principal 

Approximately one-ﬁfth of the Group’s 
broking revenue is derived from 
Matched Principal activities, where the 
Group is the counterparty to both the 
buyer and seller of a matching trade. 
The Group bears the risk of counterparty 
default during the period between 
execution and settlement of the trade.

 > Executing Broker 

The remainder of the Group’s broking 
revenue is derived from operating 
as an Executing Broker, where the 
Group executes transactions on 
certain regulated exchanges in respect 
of client orders, and then ‘gives-up’ 
the trade to the relevant client (or its 
clearing member).

Data & Analytics 
We package and sell data and analytics 
products focused on OTC instruments 
and asset classes. Our products allow 
our clients to price transactions, manage 
risk and value portfolios. Much of the 
underlying data is generated from our 
broking activities.

We aim to deploy our resources efﬁciently, 
and with the objective of creating 
sustainable shareholder value.

People 
Our people are key to our success. We are 
known in the market for our honesty, 
integrity, respect and excellence.

Liquidity 
We are experts in the product markets 
where we operate. The liquidity we can 
access enables us to provide efﬁcient 
execution services for our clients.

Financial strength 
Our ﬁnancial strength and credit 
worthiness provides security to clients and 
allows us to invest in growing our business. 

Data 
We have a competitive advantage as a 
leading provider of data on OTC markets, 
including pricing data. 

International network 
We are able to service our clients across 
the world with ofﬁces in 26 countries. 

What makes us relevant
We are a leading global inter-dealer 
broker across OTC ﬁnancial asset classes, 
and a leading provider of brokerage 
services in the energy and commodities 
segments. We provide our clients with 
access to critical liquidity. The transactions 
we facilitate often are bespoke in nature, 
complex, and of a high nominal value.

The Group’s business model is based on 
providing an intermediation service to 
clients, which can be provided with 
minimal credit and market risk.

Read more about how we transact 
through real world examples in our 
infographic on page 4 of this report.

Shareholders 
We aim to create long-term shareholder 
value across the market cycle.

Clients 
We provide exceptional customer 
service, liquidity, data and efﬁcient 
pricing that enable our clients to achieve 
the outcomes they want. We constantly 
adapt our offering to suit clients’ 
evolving requirements.

Colleagues
We aim to provide a respectful workplace 
that supports innovation, high 
performance and continuing personal  
and professional development.

Community & Environment 
We have a well-developed corporate and 
social responsibility programme, which 
includes the annual hosting of a highly 
successful global charity day event, which 
has raised over £150m over the past 
28 years. We recognise our responsibility 
towards the environment and in 2020 
we reduced our total emissions by 
10% and established a new ESG 
reporting framework.

Regulators 
We engage with regulators to improve  
the functioning of ﬁnancial markets to 
provide liquidity in diverse market conditions.

Suppliers 
We aim to cultivate strong relationships 
with our key suppliers, encouraging SMEs, 
managing supply chain risk using a 
structured policy framework and always 
endeavouring to pay our suppliers 
on time.

Annual Report and Accounts 2020
7

 
 
 
 
 
 
 
Investment case

Liquidity 
We are the number one IDB globally, with a weighted average 
market share of 40% (by revenue of key asset classes).

Networks 
We have established relationships and strong brand recognition 
with top tier investment banks.

Electronification 
We invest in technology to improve execution workflow 
and profit margins.

Data 
We are a leading provider of OTC asset class datasets. 

Neutrality 
We are recognised as an independent intermediary.

Expertise 
Our outstanding market expertise is widely appreciated by the 
market, especially in voice/hybrid broking.

Annual Report and Accounts 2020
8

Board Chair’s statement

Richard Berliand 
Board Chair

I am pleased that the Company was 
able to deliver robust financial results, 
demonstrating the benefits of our 
diversified business model and 
electronification, aggregation and 
diversification strategy

Annual Report and Accounts 2020
9

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Dear fellow shareholder
2020 proved a remarkably challenging year for many as the 
world faced the global COVID-19 pandemic, which dominated 
the agendas of governments and organisations across the globe. 
From the outset of the crisis, TP ICAP’s priority was to protect the 
wellbeing of our staff and in so doing ensure continuity of service 
to our clients and the stability and connectivity of the markets. 
Towards the end of the year, we had the additional uncertainty 
posed by the end of the Brexit transition period. 

Despite these challenges, I am pleased that the Company was able 
to deliver robust financial results, demonstrating the benefits of our 
diversified business model and electronification, aggregation and 
diversification strategy. Although Global Broking’s full year results 
were disappointing given the division’s strong first quarter, our 
Energy & Commodities, Data & Analytics and Institutional Services 
divisions performed strongly and grew revenue.

Trading and dividend 
Reported revenues for the Group were £1,794m in 2020 (2019: 
1,833m), down 2% against 2019 (1% lower on constant currency 
rates). On a statutory basis, operating profit increased 25% to 
£178m (2019: £142m) while adjusted operating profit was down 
3% to £272m (2019: £279m).

The Board declared an interim dividend of 4 pence per share paid 
on 6 November 2020 (rebased to take into account the bonus 
element of the rights issue completed in February 2021) and is 
recommending a final dividend of 2 pence per share to be paid on 
18 May 2021 (with a record date of 9 April 2021). This final dividend 
recommendation is in line with our announcement to the market in 
October last year.

COVID-19
Our people are central to TP ICAP’s ability to meet the needs of 
our clients and, from the outset of the pandemic, the safety of 
colleagues across all global locations has been paramount. 
The speed and agility with which we were able to deploy new 
technology and workflows that enabled many of our staff to work 
from home while maintaining seamless, global client coverage and 
connectivity was remarkable. For those that could not work from 
home, we took measures to ensure that our colleagues could work 
from offices in as safe an environment as possible. Throughout this 
period, TP ICAP also took the decisions as a result of COVID-19 to 
make no redundancies, make no salary reductions for our general 
workforce nor apply for any government support packages except 
a de-minimis amount in Hong Kong, which we are returning.

 
 
 
 
 
 
 
Board Chair’s statement
continued

Looking after our people, serving our clients and providing 
essential liquidity to the markets is fundamental to the Company’s 
purpose, but I am pleased that at the same time we were able to 
support the communities in which we work; for example in April and 
May 2020 we supplied and delivered thousands of face masks to 
hospitals in London, New York and Bangkok. Also, in a year when 
charities around the world struggled in their fundraising efforts, 
ICAP adapted to host a virtual Charity Day in December, 
supporting over 100 charities across the globe, and raising £3.6 m.

Corporate structure, our strategy and Liquidnet 
Over the past 18 months, following the completion of the Tullett 
Prebon and ICAP integration programme, the Board has spent 
a considerable amount of time reviewing and agreeing the 
medium-term strategy of the Company.

In December 2019 we announced proposals for a corporate 
restructure. This will create a capital efficient corporate structure 
that will provide greater financial flexibility, stronger regional 
governance and greater competitiveness. The Group previously had 
a deficit in its consolidated capital requirements under CRD IV. The 
corporate structure that we have created will enable the Group to 
comply with these requirements and removes the need for a waiver. 
This alleviates the prior requirement of setting aside around 
£25-£30m of tangible capital per annum from our in-year earnings 
until the end of 2026. While, largely due to COVID-19, this took 
longer than planned to execute, we are delighted that on 
26 February 2021 we completed this restructure and now the 
Group’s ultimate holding company is TP ICAP Group Limited, 
a company registered in Jersey. As previously set out, this does 
not have an impact on the Group’s tax domicile or our stock 
exchange listing, both of which remain in the UK.

This was an important step for the Group, not least because the 
redomicile was a precondition in the completion of the acquisition 
of Liquidnet. The acquisition, which was approved by a significant 
majority of shareholders at the beginning of February, is on 
schedule to complete in late March 2021. As a Board, we are 
particularly excited by the prospects and opportunities that the 
acquisition presents to dramatically accelerate the execution of 
our medium-term strategy.

Stakeholder engagement 
I have continued my dialogue with many of our shareholders over 
the last year and I was very grateful for their important feedback 
as we considered the implementation of our new medium-term 
strategy and, most recently, the capital raise and acquisition 
of Liquidnet.

As an organisation we are not only focused on long-term value 
creation for our shareholders, but also in serving the interests of 
other key stakeholders. As I have set out, communicating with and 
safeguarding our employees was critical this year. Although the 
Non-executive Director Employee Engagement Programme was 
disrupted by the COVID-19 pandemic, regular Chief Executive 
Officer communications including videos to all staff were very well 
received and much was learnt and shared with the Board from 
other forms of staff engagement, such as the global diversity 
and inclusion survey conducted in the summer. 

Active engagement with clients and regulators was also imperative 
as it allowed us not only to act quickly in response to the developing 
world health crisis, but also in developing and executing our Brexit 
implementation plans. 

Board changes 
Angela Crawford-Ingle and Mark Hemsley joined the Board in 
March 2020 as Non-executive Directors. Angela has been Chair 
Designate of the Audit Committee since her appointment, and will 
assume the Chair of that Committee when Roger Perkin steps down 
from the Board after the 2021 Annual General Meeting in May. 

Lorraine Trainer decided last March not to seek re-election at the 
2020 Annual General Meeting and consequently stepped down 
from the Board on 13 May 2020. In light of Lorraine’s departure, 
Angela Knight, who had been due to step down from the Board, 
agreed to remain on the Board for the near-term and assume the 
Chair of the Remuneration Committee as well as continue as the 
Company’s Senior Independent Director. Angela will step down 
from the Board after the 2021 Annual General Meeting in May. 
My Board colleagues and I will miss Angela’s and Roger’s 
invaluable contribution and challenge in Board debate, as well 
as their sound counsel, and we wish them both well for the future. 

Turning to strategy, in December 2020 we held our Capital Markets 
Day at which Nicolas Breteau and his executive team outlined 
TP ICAP’s medium-term plans to drive higher returns for shareholders. 
The strategy builds on our core strengths, has a clear execution 
path and, with its three pillars of electronification, aggregation 
of liquidity, and diversification, we believe is the right strategy 
at the right time given the changing nature of the market and 
needs of market participants. The presentation was well 
received by analysts and commentators; our focus going forward 
is execution.

I was delighted in the Autumn to announce that Tracy Clarke and 
Kath Cates would be appointed to the Board from 1 January 2021 
and 1 February 2021, respectively. Tracy will assume the Chair of 
the Remuneration Committee and Kath the Chair of the Risk 
Committee at the conclusion of the 2021 Annual General Meeting. 
Of the last four appointments to the Board, I am pleased that three 
were women: I remain committed to ensuring we have a diverse 
Board and provide a further update on our diversity aspirations, 
including attaining and maintaining a minimum 33% female 
representation on the Board, later, in the Governance Report.

Annual Report and Accounts 2020
10

Environmental, Social and Governance (‘ESG’)
I set out last year that one of my key priorities was to intensify and 
raise awareness of our ESG efforts. As demonstrated in the ESG 
section which features later in the Annual Report, we have made 
great strides forward as an organisation. Not only are we 
significantly improving how we track and report against key ESG 
performance metrics, but we have also raised awareness among 
our colleagues with the launch at the end of the year of Ethos, 
a new quarterly ESG newsletter to staff.

The Board remains cognisant of societal expectations, recognising 
that performing well in ESG represents a licence to do business. We 
are committed to further development of our ESG strategy and this 
remains high on the Board’s agenda, with particular focus on 
achieving reductions in our environmental footprint and supporting 
and promoting initiatives that make a positive difference to the 
communities in which we work. To further demonstrate this 
commitment, we recently appointed Tracy Clarke as Non-executive 
ESG Engagement Director: she will work closely with the Company’s 
senior management to ensure, amongst other things, that the 
Board continues to have the right conversations on business 
strategy from an ESG perspective. 

Risk
A key priority for the Group in 2020 was fully embedding our new 
Enterprise Risk Management Framework (‘ERMF’) throughout the 
organisation. In November the Board received positive feedback 
from its lead regulator following an external third-party review on 
the embedding of the ERMF. It is pleasing to note how colleagues 
have engaged with and embraced the ERMF, and are using the 
new risk tools and processes in their roles. TP ICAP will not be 
complacent, however, recognising that the ERMF will need to 
continuously evolve, especially given the significant corporate 
change that I mentioned earlier.

Outlook
At time of writing, we still face many of the challenges which 
I alluded to earlier, and consequently the macroeconomic outlook 
remains uncertain. However, I remain hugely encouraged by the 
incredible agility and dedication of our people and leadership 
team over the last year. Above all, I am excited for TP ICAP’s 
future as we complete the acquisition and integrate Liquidnet 
into the Group.

Richard Berliand
Board Chair
9 March 2021

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Response to the COVID-19 pandemic:
>   The Group fundamentally re-engineered its 

operations during lockdown to maintain continuous 
global client service and liquidity across all asset 
classes and desks.

>   Tactical deployment of new digital solutions and new 
workflows enabled the vast majority of the Group’s 
employees to work from home effectively.

>   Re-engineering the business presented significant 

technological, management and regulatory 
challenges, coming as it did during a period of 
extremely high volatility and a sharp increase in 
volumes. The Group demonstrated readiness and 
resilience to continue to serve clients and provide 
essential liquidity in the markets.

>  The Group has not made any redundancies, or made 
any salary reductions for our general workforce as a 
consequence of COVID-19, nor has it applied for any 
government packages except a de-minimis amount in 
Hong Kong, which we are returning.

>  The Group paid its final 2019 dividend and interim 

dividend for 2020. A final dividend is recommended 
for 2020 in line with the announcement to the market 
in October 2020.

Annual Report and Accounts 2020
11

 
 
 
 
 
 
 
Chief Executive Officer’s review

Nicolas Breteau
Chief Executive Officer

2020 was a year in which the Group 
made material progress in enhancing 
its position as a leading, global 
market infrastructure and data 
solutions provider.

Annual Report and Accounts 2020
12

Modernising markets drives performance

£1,794m

Revenue 
-2% v 2019

6.0%

Increase in diversified revenue
-10% pts v 2019

9.9%

Reported operating profit margin
+2.2% pts v 2019

Expanded our customer base, range of 
services and geographic profile, 
especially in our newest divisions.

Enhanced the synergies and links 
between our business divisions to 
maximise cross-selling opportunities.

Modernised our technology infrastructure 
by investing in cloud capabilities

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

2020 was in many ways a landmark 
year in the development of the Group. 
We announced a new strategy; unveiled 
a transformational transaction; and 
continued to adapt and strengthen our 
platform against the most challenging 
of backdrops.

Despite the challenges posed by the pandemic, we made 
significant progress during the year. We announced our new 
strategy in March, which was explained in detail at our Capital 
Markets Day in December 2020. We have started the execution 
of this strategy, albeit at a slower than originally intended pace as 
we took a prudent approach to investment given the uncertainty 
caused by COVID-19. 

The acquisition of Liquidnet, approved by shareholders on 
1 February 2021, will accelerate the execution of our strategy as 
well as provide our firm with significant new growth opportunities.

To partially fund the acquisition, we launched a rights issue to raise 
£315 million. This issue was successfully completed with existing 
shareholders taking up more than 98% of the new shares, with the 
remainder offered into the market. The new shares commenced 
trading on the London Stock Exchange on 17 February 2021.

Financial performance
The Group delivered a robust performance in 2020. The year 
started with high market volatility, resulting in a very good 
performance in the first three months of the year. Markets were 
materially slower thereafter, with a consequential impact on 
revenues. This underlined the importance and growing success of 
our diversification strategy as lower full year revenues in Global 
Broking were partially offset by strong full year revenue growth in 
Energy & Commodities, Institutional Services and Data & Analytics. 

In 2020, revenues from our faster growing, non-Global Broking 
businesses accounted for 35% of total revenues, compared to 
32% in 2019. 

Group revenue declined 2% to £1,794m against £1,833m for the 
prior year on a reported basis (1% at constant currency) as although 
Global Broking experienced a weaker year we saw continued good 
growth in our other three businesses. We achieved a reported 
operating profit of £178m for the Group, up 25% on the prior year, 
with our adjusted operating profit of £272m, down 3% from last 
year. The increase in reported operating profit was mainly due to 
2020 being the first year following the completion of the ICAP 
integration and therefore benefiting from no integration costs. 
Our reported operating profit margin of 9.9% was up 2.2% on last 
year, and the adjusted operating profit (EBIT) margin of 15.2% is 
flat on the prior year, due to strict cost controls. We reported 
a statutory profit before tax of £129m, 39% higher than last year 
with the adjusted profit before tax of £223m, down 3% from £230m 
in the prior year. 

CEO review
2020 was a year in which the Group made material progress in 
enhancing its position as a leading, global market infrastructure 
and data solutions provider.

We unveiled and started the execution of our new strategy to drive 
higher returns to shareholders. We announced the acquisition of 
Liquidnet, an electronic, buy-side focused trading network, which 
will fundamentally accelerate the execution of our strategy and 
transform our future growth prospects. We made good progress on 
the redomiciliation of our Group holding company, which will 
provide greater financial flexibility for the Group and became 
effective on 26 February. We continued to enhance the enablers 
of our strategy, such as embedding our Global Risk Framework and 
developing and launching our new ESG Reporting Framework.

That such progress was achieved against the backdrop of COVID-19 
serves only to underline the operational strength and flexibility of 
our Group, which in turn positions us well to continue to execute our 
strategy to drive higher returns to shareholders over time.

Managing COVID-19 
COVID-19 caused a considerable shock to the global economy and 
had a significant impact on the markets in which we operate. We 
saw a substantial increase in volatility in the early part of the year, 
although this dropped materially after April as clients assumed 
more risk averse positions and therefore traded significantly less. 
We saw a degree of normalisation of trading in OTC markets 
towards the end of the year. 

Following the emergence of the pandemic, we acted quickly to 
adapt our operational processes to protect our staff and meet the 
various COVID-19 guidelines that were issued in the 26 countries 
where we operate. In a matter of weeks we introduced new digital 
technology and amended workflows which allowed a significant 
proportion of brokers to work from home. For those brokers who 
remained in the office during this time, we reconfigured the layout 
of our offices to provide adequate space to socially distance. 

Through these actions, and at a time of unprecedented market 
volatility, we ensured that all desks continued to be fully 
operational, that our clients benefited from continuous global 
coverage across all asset classes, and that global markets remained 
open and liquid. 

The overwhelming majority of our support staff have worked 
from home throughout the pandemic. Where required, particularly 
in the compliance, risk, regulatory and IT functions, we have 
enabled a small number of employees to come into our offices 
to support brokers.

Annual Report and Accounts 2020
13

 
 
 
 
 
 
 
Chief Executive Officer’s review 
continued

Basic reported earnings per share (‘EPS’) was 17.2p with adjusted 
earnings per share of 32.9p. We are paying a dividend of 6.0p per 
share for the full year (rebased to take into account the bonus 
element of the rights issue), in line with our intention stated in the 
announcement regarding the acquisition of Liquidnet on 
9 October 2020. 

Regional performance 
Revenue for the EMEA region was £888m, a 1% decrease on a 
reported basis (1% at constant currency). Global Broking revenue 
decreased 6% as a very strong first half, particularly in Rates and 
FX, was more than offset by a significantly weaker second half with 
the Emerging Markets business performance suffering from the 
pandemic driven slow-down in Turkey and South Africa. Energy 
& Commodities was up against a strong prior year performance, 
Institutional Services grew revenues as it continued to scale up 
and Data & Analytics delivered another year of strong growth. 

The Americas reported revenue of £670m was down 2% year-on-
year on a reported basis (down 1% in constant currency). Strong 
growth in Energy & Commodities, Institutional Services and Data 
& Analytics was offset by Global Broking which faced difficult 
market conditions. 

In Asia Pacific, revenue at £236m decreased 4% year-on-year on a 
reported basis (3% on constant currency). This reflected very good 
growth in Energy & Commodities, Institutional Services and Data & 
Analytics, with more challenging Global Broking figures, as trading 
appetite dampened due to the pandemic placing practical 
constraints on market activity.

Strategic delivery
In March 2020 we identified the three key strategic pillars which 
would underpin our medium-term growth strategy: electronification; 
aggregation of liquidity; and diversification of our revenues. 
On 1 December we held a Capital Markets Day at which senior 
management presented in detail how this strategy would be 
executed across the Group. 

For our Global Broking and Energy & Commodities businesses, we 
are executing a hub strategy for the asset classes of Rates, Foreign 
Exchange, Credit, and Oil. These hubs will drive electronification 
and liquidity aggregation. They will offer clients a single sign-on 
to access via a single screen a multitude of TP ICAP products and 
brands all with a common look and feel. The hubs will provide 
robust pre- and post-trade processing, improved connectivity and 
straight-through processing. 

The overall outcome from the hub strategy will be institutionalising 
volumes and client relationships. We have already launched several 
electronic platforms, and these are already demonstrating tangible 
benefits for TP ICAP and our clients. The hubs will result in increased 
revenues. With these platforms client volume tends to be stickier, 
and brokerage rates more standardised. Silos between bank traders 
should erode enabling more cross-asset or cross-instrument 
transaction activity which will result in increased volume. With more 
client activity conducted via platforms and common screens, there 
will also be more opportunity for us to provide targeted data and 
analytics products. Most importantly, we expect them to result in 
lower costs. 

In Data & Analytics, our focus is on moving up the value chain in 
terms of product offering, going beyond selling raw data to selling 
value-adding solutions, something for which clients will pay 
a premium. We will also innovate in how we distribute, delivering 
our solutions both directly through a webstore but also partnering 
with other well-established cloud providers. Finally, our focus is to 
expand to new buy-side clients, and increase our market share of 
the wallet with existing clients. 

In Institutional Services, the focus will remain on expanding product 
coverage as well as building out regional customer coverage. 

Liquidnet
To materially accelerate our strategy we announced the proposed 
acquisition of Liquidnet, a premier, technology-driven, global 
electronic trading network focused on the buy-side. The acquisition 
will also bring deep expertise in the cash equities asset class as well 
as provide us with compelling new growth opportunities as we 
explained at our Capital Markets Day. 

The total consideration for the acquisition is between US$575m and 
US$700m, comprising cash of US$525m, subject to customary 
adjustments, payable on completion and with deferred consideration 
of US$50m and contingent deferred consideration of up to US$125m.

Liquidnet’s electronic network incorporates extensive buyside trade 
workflow connectivity, including integrations with all major order 
management and execution management systems. We intend to 
build on Liquidnet’s capabilities and connectivity, and expand its 
offering, particularly in respect of Dealer-2-Client electronic trading 
in Credit and Rates. Furthermore, we expect to leverage the data 
assets and analytics expertise of both organisations to drive 
non-transaction-related earnings.

We believe that TP ICAP’s strong dealer relationships and product 
expertise are highly complementary to Liquidnet’s electronic 
capabilities and global buyside customer base. In addition, its 
global low-touch block cash Equities franchise complements our 
existing high-touch derivatives and cash Equities activities. 
Combined, TP ICAP and Liquidnet will be able to offer our clients 
compelling electronic trading and analytics solutions, driving 
sustained growth and shareholder value creation over the medium 
and long term.

Annual Report and Accounts 2020
14

While this new strategy will drive the medium-term growth of TP 
ICAP, we took the decision to slow investment in 2020 adopting a 
prudent approach to managing through the crisis and prioritised 
our liquidity and capital buffers under stressed scenarios. 

Despite the aforementioned deceleration, we were still able to 
progress with a number of strategic initiatives and detail some 
of these in the business division reviews below. We intend to 
accelerate the execution of our strategy in 2021 and the 
following years.

Business Review
Global Broking 
Global Broking is our largest division covering Rates, Credit, 
Equities, Foreign Exchange & Money Markets and Emerging 
Markets, where we have market-leading positions. We bring 
together buyers and sellers providing a range of professional 
intermediary services that enable them to execute trades 
successfully. We operate through Tullett Prebon and ICAP brands 
separately. We also offer clients a range of ways to interact with us 
– through voice, hybrid or electronically – depending on the nature 
of the market, product and transaction. One of our fundamental 
strengths is the long-established relationships we have with top-tier 
banks, and our ability to operate deep liquidity pools.

Our largest business, Rates, saw revenues decline 5% on a reported 
basis (4% in constant currency) year-on-year following a stand-out 
start to the year due to the impact of many countries also reducing 
interest rates to near zero and embracing quantitative easing. 
Our Equities business was flat on the year in reported currency (2% 
higher in constant currency), as although the market was buoyant 
for cash equities, our business is geared toward Equity Derivatives 
which experienced a quieter period. We saw the benefit of the LCM 
acquisition towards the end of the year as the transaction closed. 
FX and Money Markets’ revenue declined 7% on a reported basis 
(down 7% in constant currency) due to subdued client activity from 
lower volatility and volumes. The Credit market remained subdued 
for interdealer brokers as new market participants continued to 
take market share and new issuance growth did not translate into 
secondary trading, which resulted in a 4% revenue decline on a 
reported basis, and 3% lower in constant currency. The Emerging 
Markets business was affected by the practical impact the 
pandemic had on those countries with revenues declining 14% 
on a reported basis (12% at constant currency). 

Despite the difficult macroeconomic backdrop, we continue to 
identify opportunities to fill gaps in coverage and offer additional 
products for our clients as well as continue to expand our hybrid 
and electronic matching technology offering. 

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Global Broking had a very strong first quarter of 2020 primarily 
due to abnormal levels of volatility in March leading to significant 
trading volumes. In the ensuing months, many clients decided to 
wind down any positions they had and reduced their risk appetite. 
Consequently, from May through to October markets were much 
quieter with a resulting negative impact on revenues. Trading in 
the final months of the year improved slightly to more normalised 
patterns, albeit not with the levels of activity usually associated 
with a US Presidential election.

We made progress in rolling out the hub strategy, although, as 
stated, at a slower pace than we had anticipated at the start of the 
year. For the Rates hub, we introduced several enhancements to our 
market-leading ICAP Interest Rate Options (‘IRO’) platform and 
achieved our first cross-product electronic aggregation of liquidity, 
by bringing inflation swaps/index, conventional gilts, and interest 
rate swaps onto a single trading platform. We achieved cross-brand 
aggregation in September when we introduced the ICAP Interest 
Rate Options platform to the Tullett Prebon brand.

As a consequence of these macro conditions, revenues for the year 
were down 6% in reported currency (5% lower at constant currency) 
at £1,188m from £1,262m in the prior year. It is important to 
highlight that while the large Tier 1 investment banks are our main 
client base, their revenue performance is not always a good proxy 
for that of Global Broking. Global Broking is paid on volumes on 
secondary markets while Investment Banks benefit from, inter alia, 
primary issuance in the equity and debt markets from principal 
trading and mark-to-market changes in inventory positions. We 
believe a better guide is provided by the public information on 
secondary volumes in the relevant market infrastructure markets, 
mainly exchanges and other platforms.

For the FX hub, we launched FXO Hub, our cross brand platform for 
trading FX Options in March this year and we are encouraged by its 
initial performance, increasing our market share for this asset class 
by approximately 5%pts. 

In Credit, we increased electronification through launching the 
Matchbook Rebalance platform. This is a pure-electronic platform 
used for Emerging Market, Investment Grade, High Yield, Financial 
and Sterling Corporate Bonds. The platform, which has common TP 
ICAP branding, runs auctions allowing traders to clear up unwanted 
odd-lot risk on their books based on a total P&L marker, and has 
also recently been launched in the US.

Energy & Commodities 
Energy & Commodities (‘E&C’) is our second largest division and 
operates through the Tullett Prebon, ICAP and PVM brands in all 
key commodities markets including oil, gas, power, renewables, 
ferrous metals, base metals, precious metals and soft commodities. 
Clients include regional banks, corporates, hedge funds and 
trading companies.

The energy and commodities markets experienced high volatility in 
the first four months of the year as markets reacted to global trade 
wars and the pandemic, with clients adjusting positions to 
pandemic levels of supply and demand. A combination of clients 
assuming a risk off position and more people working from home 
led to quieter months between May and September before market 
activity returned to more normal levels for the remainder of 
the year.

Annual Report and Accounts 2020
15

 
 
 
 
 
 
 
Chief Executive Officer’s review 
continued

E&C delivered a good performance in 2020. Revenues were up 
2% in reported currency (3% in constant currency) to £391m, 
against a particularly strong prior year performance. The primary 
driver of growth was new hires as a result of our successful 
hiring pipeline.

We saw growth across the majority of product areas, with Oils, 
our largest business, benefiting from the extraordinary conditions 
seen in the first part of the year as well as the continued build out 
of the ICAP oil desk. We recorded a strong performance in Liquified 
Natural Gas as the natural gas market became a global rather than 
regional market, and experienced good growth in Metals and 
Environmental products.

We continued to build and develop the business throughout the 
year, despite the practical constraints imposed by COVID-19: our 
successful Weather Derivatives desk in the US is now linking into our 
Global power desks; we are broking Japanese power contracts out 
of Singapore with a local Japanese entity due to launch shortly; 
we have a new ICAP desk covering power markets in Central and 
Eastern Europe; and have dedicated resource who are successfully 
growing our hedge fund platform. 

We are making solid progress on building the Oil Hub, which will 
ultimately allow clients to view aggregated liquidity across our 
competing brands. We have started to roll out the electronic 
matching engine, and we are aiming for this to be on every broker’s 
desk in Q2 2021. We have implemented an Order Management 
System on the platform to facilitate and manage trades and 
provide straight through processing.

Decarbonisation has become a significant theme of the energy 
and commodities markets and we are positioning our business to 
capture the benefits of this change. Approximately 40% of our 
revenues come from positive, transitional or neutral products and 
we anticipate this increasing over time. 

Institutional Services
In 2021 Institutional Services will be renamed Agency Execution as 
it better describes the business and its activities, provides execution 
services to buy side clients including hedge funds, asset managers 
and corporates. The role of the division is to power clients’ ability 
to manage their investment or trading process – from trade 
origination and execution through to post trade analytics. 
Institutional Services seeks to ensure clients receive the best pricing 
available in the market; routing orders into multiple sources of 
pricing such as exchanges, partner bank liquidity providers and 
other venues whilst guaranteeing anonymity and neutrality. It is an 
important part of the Group’s diversification strategy bringing in 
a new revenue stream from a different client base.

Institutional Services delivered an excellent performance in 2020, 
continuing its strong growth trajectory, with revenues up 21% on 
a reported basis (21% on constant currency) to £91m, up from £75m 
in 2019. Growth was driven by the investments already made in 
people, product coverage, geographic reach and technology as 
the business has greater capacity to service clients and meet their 
expanding needs. 

Whilst exchange traded derivatives performed extremely well, 
we were particularly pleased with the ongoing and diversifying 
growth in FX, equity derivatives, IRS and government bonds which 
in aggregate secured our positive performance trajectory in 
all regions. 

During the year we experienced significant growth in requests 
from investors that have traditionally sought execution services 
exclusively from banks. It is our belief that this trend will continue. 
Banks appear to be de-prioritising investment in agency execution 
services, consistent with the demands to ‘do more with less’. Banks’ 
investments are increasingly geared to businesses with better 
ability to capitalise on available leverage. At the same time our 
Institutional Services business has grown its breadth and quality 
of coverage to a point where we have a significant footprint and 
a growing reputation as an alternative to traditional banks’ sales 
desks – evidenced in our ongoing market share growth.

As well as adding clients, we also note that the number of existing 
clients engaged in two or more products with us is increasing. This 
is an extremely encouraging development and one that we think 
becomes an important driver in our next growth phase. 

Our strategy for Institutional Services remains to continue to grow 
the business and diversify our revenues through: adding more asset 
classes to our coverage; broadening our geographic reach; and 
investing in further electronification. 

Data & Analytics
Our Data & Analytics business provides unbiased data products 
that facilitate trading, enhance transparency, reduce risk and 
improve operational efficiency. It is the leading provider of OTC 
pricing data and has access to pricing, reference data and 
analytical tools for major asset classes and markets. We pride 
ourselves on our rigorous quality assurance processes, which ensure 
the integrity and robustness of our products.

D&A is a fast growing, high margin business with revenues that 
are largely subscription-based – more than 90% of revenues 
were recurring in 2020 – so it provides us with excellent earnings 
diversification and sustainable growth opportunities. 

Revenues for 2020 were up 7% on a reported basis (9% in constant 
currency) at £145m which was a strong performance given 
estimates that financial market data companies will have seen 
growth of between 4-5% for the year, according to Burton Taylor 
estimates. While the pandemic caused D&A to experience weaker 
growth in the first half of the year, it saw an improved performance 
in the second half with a particularly strong final quarter where 
revenues grew 11%. We remain confident that the business will 
deliver double-digit revenue growth in 2021. 

Annual Report and Accounts 2020
16

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

The business also made further progress with its growth strategy in 
the period. It invested in its people and processes, introducing new 
sales methodology, appointing Regional Heads of Sales, and hiring 
sales specialists focused on Energy & Commodities. This new, 
systematic approach should lead to a shorter sales cycle and lasting 
revenue benefits. 

We continued to develop new products, launching six new offerings, 
including, importantly, our first ‘information’ product: Bond 
Evaluated Pricing (‘BEP’). BEP combines our data with third parties’ 
data to create intra-day, transparent insight with observable 
pricing from our neutral broking partners. We created the product 
after our clients told us that meaningful transparency in fixed 
income pricing has become critical as regulators globally require 
more detailed disclosure and stricter risk management. We intend 
to roll out further information products in 2021. 

We introduced a new Enterprise Risk Management framework 
(‘ERMF’) in the second half of 2019 accounting for the increased 
scale and diversity of our business and responded to regulatory 
expectations. One of the key matters for the Risk Committee 
was the monitoring of the operation of the new ERMF with the 
objective of ensuring it has been embedded across all the Group 
(organisationally and geographically). This includes the new 
Governance, Risk Management and Compliance (‘GRC’) system 
underpinning the ERMF and risk management training to all staff. 
The ERMF has now had extensive third-party reviews which have 
found that the framework has been embedded consistently across 
the Group with no adverse findings. TP ICAP has now attested to 
the embedding and ongoing operation of the ERMF. We have 
reviewed our principal risks and evolved the ERMF to account for 
factors including COVID-19, the potential impact of Brexit and 
execution risk of the Liquidnet acquisition.

Near term outlook 
 > The first two months’ revenue per trading day is marginally 

higher than the prior year. March 2020 was a record month in 
terms of revenues, with very strong secondary volumes and 
exceptional volatility. As such, given this tough comparative, our 
Q1 2021 revenues may be lower than in the prior year. For 2021, 
we expect full year revenue to grow at low single-digit at 
constant currency basis.

 > As we outlined in our Capital Markets Day, we are targeting 
c.£30m of strategic cash investments in 2021, which includes 
c.£13m of operating expenses. 

 > With regard to Brexit, despite the complications caused by 

COVID-19, we are executing our plans, leveraging our EU network, 
and moving brokers to our Paris hub. As a result, we continue to 
cover our EU clients effectively.

 > All the aforementioned targets exclude any potential impact 

from the completion of the Liquidnet acquisition.

Concluding comments
2020 was in many ways a landmark year in the development of the 
Group. We announced a new strategy; unveiled a transformational 
transaction; and continued to adapt and strengthen our platform 
against the most challenging of backdrops. Consequently, TP ICAP 
is well placed to adapt and remain relevant as markets and clients’ 
needs continue to evolve. In so doing, we will drive sustainable 
growth and higher returns to our shareholders over time and extend 
our position as a leading, global market infrastructure and data 
solutions provider.

During these unprecedented times I would like to thank our 
shareholders for their overwhelming and continued support in 
relation to the acquisition of Liquidnet, the successful rights issue 
and redomiciliation of our Group’s holding company. I would 
also like to thank all of my colleagues at TP ICAP for the 
remarkable fortitude they have demonstrated throughout 2020, 
and of course our clients for their continuing trust in us. I look 
forward to working with you all in the coming year, one that 
I approach with confidence. 

Nicolas Breteau
Chief Executive Officer
9 March 2021

In the energy and commodities sector, we began the roll out of our 
new Oil Market Data Feed, on the crude and refined oil markets 
aimed at trading houses, major oil companies, buy-side funds and 
the banks. We have also enhanced our offering in Liquified Natural 
Gas expanding coverage to include additional markets such as 
US Gulf Coast and West India Marker. 

In terms of distribution initiatives, we launched a new direct to 
client service, known as SURFIX, which provides clients direct access 
to our critical mass of breadth across our multiple brands, including 
Tullett Prebon, ICAP and PVM, in the easy-to-use, industry standard 
FIX format. We expanded our Channel Partners to include the 
public cloud providers, providing clients with options on moving 
market data infrastructure into the cloud. This will allow client to 
operate with greater agility and a lower total cost of ownership.

We will continue to roll out new products covering other asset 
classes, third-party data partnerships and moving up the value 
pyramid. We plan to capitalise on regulatory opportunities, 
including new risk-free rates in connection with the retirement 
of LIBOR, and the need for regulated benchmarks and indices. 
This includes an Interest Rate Options Volatility Index based on 
our Global Broking data, and index partnerships, in Energy 
and Commodities. 

Environmental, Social & Governance 
Increasingly, clients, investors, ratings agencies, regulators, 
Non-Governmental Organisations and other core stakeholders 
incorporate environmental, social and governance (‘ESG’) 
performance into their decision-making process. Consequently, 
we believe performing well in ESG represents a licence to do 
business and is a critical factor in achieving sustainable growth.

In 2020 we undertook a comprehensive materiality assessment 
that led to us establishing an ESG Reporting Framework formed 
of 15 data disclosure areas that are most relevant to TP ICAP. 
Each disclosure has an associated set of metrics according to 
internationally recognised standards. To ensure ownership and 
accountability, individual disclosure areas have been assigned to 
a relevant senior manager, and governance has been strengthened 
up to and including Board level. Having identified these 15 ESG 
disclosure areas, we have also begun to report against them.

We recognise that robust reporting is but one step forward in our 
sustainability journey. We have more to do, the next step being to 
develop an overarching ESG strategy that is aligned to our purpose. 
We commit to completing this strategy by the end of 2021, with 
execution to commence in 2022.

Annual Report and Accounts 2020
17

 
 
 
 
 
 
 
Market factors

Our business is influenced by a number 
of external factors. Set out below is 
a summary of some of the key market 
factors which currently affect TP ICAP 
and are expected to continue to do 
so over the coming years.

Market factor

Description

Implications for TP ICAP

TP ICAP’s response

Competitive 
environment

TP ICAP has a wide range of 
international competitors in the 
market infrastructure space, including 
inter-dealer brokers, exchanges and 
electronic platforms.

TP ICAP’s key dealer clients are 
experiencing substantial cost 
pressures in many of their core 
markets, and are generally seeking 
to optimise resource spend with 
external service providers.

Regulation

TP ICAP operates under the 
jurisdiction of a number of different 
regulators. The overall trend globally 
continues to be towards increasing 
levels of regulatory oversight. 

Complying with global trends towards 
greater and more complex regulation 
places a growing resource and cost 
burden on TP ICAP. 

Growing regulatory scope and 
complexity raises the risk 
of regulatory action being faced 
by the Group.

Technology

Technological advances potentially 
enable a new generation of 
competitors to disrupt existing players.

Advances in technology bring 
changes in how our clients’ businesses 
are run and in the risks they face. 
Similar matters directly impact our 
own business.

Technological change has the 
potential to impact the Group both 
positively and negatively, depending 
on a range of factors. The use of 
technology allows us to enhance the 
services we provide to clients, 
improving efficiency and profitability. 
Technological change could also 
present challenges if, for example, the 
Group’s technology strategy were to 
fail to evolve in line with wider market 
developments and client requirements.

Annual Report and Accounts 2020
18

TP ICAP has adopted a proactive 
approach to client engagement 
and improving our clients’ 
experience, such that we deliver 
value and meet the evolving needs 
of our client base. TP ICAP has 
also focused on becoming a more 
attractive place to work and we 
continue to defend ourselves 
against staff poaching by 
competitors.

We continue to invest in our risk 
and compliance frameworks and in 
our staff to ensure we have the right 
skills to advise and direct our 
business on the implications of the 
changing regulatory environment.

With regard to Brexit, we continue 
to monitor the EMEA regulatory 
environment and have prepared for 
a range of potential outcomes. We 
are also liaising with our clients to 
understand their plans so that we 
can continue to provide them with 
a high-quality service. Please refer 
to the Principal Risks section on 
page 46 for additional details 
on our Brexit response.

We will continue to invest in 
technology. A substantial budget 
for strategic investments was 
communicated at our Capital 
Markets Day in December 2020. 
These investments are expected 
to result in future operating 
margin improvement.

The acquisition of Liquidnet as 
a technology-driven, global 
electronic trading platform is in 
line with our strategy of driving 
the overall electronification of 
TP ICAP’s businesses.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Market factor

Description

Implications for TP ICAP

TP ICAP’s response

Big data 
developments

Significant volumes of data can be 
collected and analysed far more 
quickly and cheaply than in the past. 
Combined with machine learning 
tools, cheaper, faster processing of 
data can facilitate the rapid 
extraction of meaningful information 
and insights.

Coronavirus 
(COVID-19)

The COVID-19 pandemic had, and is 
still having, a very significant impact 
on global socio-economic conditions. 

Much of the data we have gathered in 
the past and present could now be 
developed into sophisticated products 
in a way that was not feasible or cost 
effective in the past.

We aim to develop value-added 
data products and services by 
ourselves and in cooperation 
with partners.

In addition, we intend to leverage 
our capabilities by supplementing 
our in-house data library with 
information gathered from 
third-party sources.

Our agile transition in early 2020 to 
a working from home environment 
allowed business continuity and 
limited business disruption. Our 
continued focus on electronification 
will further support agility in our 
workforce to ensure we continue 
to meet the needs of our clients, 
regulators and safety of employees.

The outbreak of COVID-19 in early 
2020 required us to quickly facilitate 
the transfer of much of our employee 
base to working from home. The 
uncertainty associated with COVID-19 
also impacted on market conditions 
throughout the year, with a notably 
substantial increase in market 
volatility and trading volume in 
the early part of 2020, with more 
muted trading activity characterising 
operating conditions in subsequent 
months.

Annual Report and Accounts 2020
19

 
 
 
 
 
 
 
Strategy

Our vision is to be the most trusted and respected data and 
market execution provider in the financial, energy and commodity 
segments where we operate. 

We aim to realise our vision by building on our traditional 
strengths, whilst simultaneously transforming and evolving, such 
that we remain well placed to capitalise on the opportunities 
presented by fast-moving changes in market structures, regulation, 
and client needs. 

To anticipate and respond to change, we are shaping our business 
along three strategic growth pillars – Electronification, 
Aggregation and Diversification.

In line with our strategy, we believe that the acquisition of 
Liquidnet presents a unique opportunity to transform our client 
base, earnings mix and growth trajectory, strengthening our 
market positioning and longer-term prospects of revenue growth 
and profit margin expansion. 

Whilst the Group’s financial performance in any given reporting 
period will reflect then-prevailing operating conditions (including 
market direction and price volatility), over the medium term 
we will endeavour to deliver an improved earnings mix and 
profitability profile, including a higher percentage of recurring 
revenue, a higher percentage of electronic, higher margin 
revenues, further diversification of the sources of earnings, 
and underlying operating margin expansion.

Annual Report and Accounts 2020
20

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

The acquisition of Liquidnet is 
expected to meaningfully enhance 
TP ICAP’s electronic network assets 
and capabilities

Key strategic pillars

Electronification
Increase use of electronification 
and technology

Strategic output
Improve operating margins

We believe that better use of technology will improve the 
efficiency and profitability of our client-facing services and 
internal operations.

We will seek to enhance our medium-term profitability potential 
by progressively increasing the amount of client activity and 
services that are delivered electronically. Our electronification 
plans embrace pre- to post-trade transaction services, the delivery 
of data and analytics, as well as our internal processes. Of course, 
we intend to customise our approach to electronification in each 
of our product markets to reflect the relevant market structure 
characteristics, such as market size, maturity, level of 
standardisation, applicable regulations and any other 
relevant attributes.

The acquisition of Liquidnet is expected to meaningfully enhance 
TP ICAP’s electronic network assets and capabilities. Liquidnet will 
substantially expand our buy-side connectivity; Liquidnet’s unique 
‘blotter sync’ technology and embedded institutional workflow 
tools leverage its connectivity with major execution and order 
management systems (EMS and OMS), facilitating efficiency in 
the order management and trade execution activity of its 1,000+ 
asset management clients.

The Liquidnet acquisition is expected to provide us with the ability 
to access a significant dealer-to-client fixed income opportunity – 
particularly in respect of Credit and Rates – by leveraging 
Liquidnet’s connectivity and platform capabilities, together with 
TP ICAP’s dealer relationships, connectivity and asset class expertise.

Aggregation
Improve client access to 
liquidity across the TP ICAP 
Group’s franchise

Strategic output
Enhance ease and attractiveness 
of transacting with TP ICAP brands

Following the completion of a number of acquisitions, most notably 
of ICAP’s voice broking division, we have expanded our brokerage 
businesses. The Group operates a number of liquidity pools across 
products, asset classes and brands. 

We intend to maintain our leading global position as the largest 
inter-dealer broker by revenue, by using technology to improve the 
efficiency of client access to relevant liquidity pools, including via 
harmonisation of the appearance of screens between products and 
brands, better API access, and integrated extraction and delivery 
of related data and analytics.

Annual Report and Accounts 2020
21

 
 
 
 
 
 
 
Strategy 
continued

Key strategic pillars

Diversification
Build out earnings from buy-side, 
corporates, and data businesses

Strategic output
Increase sustainable growth  
and quality of earnings

TP ICAP has progressively pursued greater diversification of its 
revenue profile, with our three faster growing businesses – Data 
& Analytics, Institutional Services and Energy & Commodities – 
representing, in aggregate, 35% of revenue in 2020, compared with 
32% in 2019. In particular, by expanding our Institutional Services 
and Energy & Commodities segments, we have grown our 
brokerage presence with a range of non-bank financial institutions, 
such as corporates, asset managers and hedge funds. We expect to 
continue to invest in these business segments by expanding our 
product and geographic footprint. 

In order to further leverage our OTC markets expertise and 
capabilities, and to reinforce our position as a leading provider of 
OTC data products and services, we will look to both expand and 
diversify our Data & Analytics product and service offering, as well 
as to broaden our client base, notably by targeting buy-side 
client needs. 

The Liquidnet acquisition is expected to further enhance the 
diversification of our Group’s earnings profile immediately via 
Liquidnet’s established position in institutional cash equities, and 
over time by developing credible dealer to client offerings in Credit 
and Rates. More generally, we believe that Liquidnet’s technology 
team and its capabilities in data science provide significant 
additional potential for product development.

Financial Objectives
At our Capital Markets Day on 1 December 2020, we detailed goals 
to grow revenue and drive operating margin improvement for each 
of our four key divisions – Global Broking, Energy & Commodities, 
Institutional Services and Data & Analytics. We also provided 
financial targets for Liquidnet. At a Group level, inclusive of 
Liquidnet, we are targeting:

 > 4% revenue compound annual growth rate over the medium 
term, driven primarily by the higher growth businesses of 
Institutional Services, Data & Analytics and the expected 
acquisition of Liquidnet; and

 > 18% adjusted operating margin by 2023 with the target 

increasing to c.23% in the medium term, facilitated by continued 
strategic investments in technology. 

Annual Report and Accounts 2020
22

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Case study: 

Electronification
Increased use of 
electronification and 
technology.

Our business will continue to transition towards a more electronic 
future which, in turn, will benefit our clients, TP ICAP and our 
shareholders. An increase in the amount of business we deliver 
electronically will improve client connectivity, facilitate efficient 
workflows and post-trade processing. How fast we go in the 
implementation of this strategy, and the degree and manner 
of electronification, will depend on the nature of each market 
and product.

As part of our electronification focus, last year we launched an 
innovative foreign exchange options platform, FXOhub. The 
platform represents a step-change in intuitive liquidity sourcing and 
trade execution on an industry leading platform. Across both ICAP 
and Tullett Prebon brands, it supports collation of ‘Indication of 
Interest’ bids and offers, via an electronic order book, ‘Request for 
Quote’, plus Auxiliary matching order entry methods. The platform 
is fully customisable so that each trader can design their own 
preferred setup through the use of the latest HTML5 technology 
on which it has been built. This gives way to a smoother user 
experience and improved connectivity.

The response has been excellent. Multiple top tier banks are already 
streaming liquidity and the platform has enabled us to improve our 
options market share by approximately 5 percentage points 
between Q4 2019 and Q3 2020 (Source: Clarus based on notional 
trading volume).

Annual Report and Accounts 2020
23

 
 
 
 
 
 
 
Strategy 
continued

Case study: 

Aggregation
A dynamic culture with a 
strong emphasis on conduct 
and integrity. 

By using technology to aggregate the liquidity offered across our 
brands, we increase access and choice for our clients. In Global 
Broking, by bringing together Tullett Prebon and ICAP we gain 
leadership in almost all the markets in which we operate. 
Combined, they give us the deepest liquidity pools in the industry. 

We continue to operate using both brands; they are known, trusted 
brands with which our clients relate. But whomever they choose, 
once on our platform, our screens will also offer our clients access to 
the liquidity of all our brands. By using technology to simultaneously 
display Tullett Prebon and ICAP’s prices to clients, we increase 
cross-selling benefits and market share, while clients find the 
best prices.

Our market-leading Interest Rates Option platform is an example 
of aggregation in practice. During 2020 we made several 
enhancements to the platform and achieved our first cross-product 
electronic aggregation of liquidity, by bringing ICAP inflation 
swaps/index, conventional gilts, and interest rate swaps onto a 
single trading platform. We successfully achieved cross-brand 
aggregation in September when we introduced the ICAP Interest 
Rate Options platform to the Tullett Prebon brand.

Annual Report and Accounts 2020
24

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Case study: 

Diversification
The markets we operate in 
are constantly evolving, 
creating opportunities for us. 

We continue to diversify our revenues by investing in our 
high-margin, high-growth business areas, as well as expanding 
our client base. 

We are investing in our Data & Analytics (‘D&A’) business, where 
we are already a leading provider of OTC data products. Revenues 
are high-margin, largely subscription based and tend to be more 
‘sticky’. In 2020 we launched our first higher margin ‘information’ 
product, and aim to create and commercialise a suite of 
sophisticated value-added analytics products, targeted at a 
growing number of regulatory and other use cases. D&A also 
provides diversification of client base as it counts hedge funds, 
asset managers, other data providers and corporates amongst 
its clients.

Through our Institutional Services business, we are also diversifying 
our customer base away from our traditional inter-dealer market 
of Tier 1 investment banks and into the institutional market of 
asset managers, hedge funds and non-bank liquidity providers. 
This business has been growing rapidly since its creation and is 
experiencing significant growth in requests from investors that have 
traditionally sought execution services exclusively from banks. It is 
our belief that this trend will continue as banks move away from 
these activities which need a level of service which they may 
consider to be insufficiently profitable to maintain a competitive 
presence, and where we have a significant footprint and growing 
reputation as an alternative to traditional dealer banks. We intend 
to continue to grow by expanding our product and regional footprint, 
and broadening and deepening our customer relationships. 

Annual Report and Accounts 2020
25

 
 
 
 
 
 
 
Key performance indicators

Revenue growth 
(%)

Adjusted operating profit 
margin (%)

Contribution 
(£m) 

4 40

7
1
0
2

8
1
0
2

9
1
0
2

2
-

0
2
0
2

KPI definition 
Revenue growth is defined as 
the annual growth of total 
reported revenues. Group 
revenues are shown on page 31.

.

7
5
1

.

0
5
1

.

2
5
1

.

2
5
1

9
7
6

4
9
6

0
8
6

5
5
6

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

KPI definition 
Adjusted operating profit 
margin is calculated by 
dividing adjusted operating 
profit by revenue for the 
period. A reconciliation of 
adjusted operating profit to 
statutory operating profit is 
shown on page 30.

KPI definition 
Contribution is calculated as 
revenue (at constant exchange 
rates) less broker compensation 
and other front office costs. It 
also includes the revenue of the 
data business less direct costs. 
See contribution section on 
page 37.

Comment 
Revenue growth reflects wider 
market volumes, driven by 
volatility and our ability to 
further diversify and strengthen 
our franchise. 2020 levels were 
heavily impacted by COVID-19 
that caused our largest 
division, Global Broking’s 
revenue to decline 6%, as the 
other three divisions continued 
to grow. Overall the Group 
revenues dropped 2%.

Comment 
Adjusted operating profit 
margin is a measure of the 
profitability of the business and 
is principally driven by revenue, 
broker compensation and other 
administrative expenses. The 
adjusted operating margin in 
2020 was in line with the prior 
year as lower revenues were 
offset by tighter cost control. 

Comment 
Contribution measures the 
profitability of our business. 
The absolute level is important 
as contribution less 
management support costs 
flow through to operating 
profit. By increasing the level 
of contribution the business 
increases returns to 
shareholders. During the year 
the contribution declined by 
2% on a reported basis on 
lower revenues, partially offset 
by lower front-office costs.

Link to our strategy
 > Liquidity aggregation
 > Electronification
 > Diversification

Link to our strategy
 > Electronification
 > Diversification

Link to our strategy
 > Liquidity aggregation
 > Electronification
 > Diversification

Financial KPIs

Annual Report and Accounts 2020
26

 
 
 
S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

All our KPIs, are Alternative 
Performance Measures (APMs) 
as defined by European Securities 
and Markets Authority (‘ESMA’). 
We provide these to offer 
additional insights into the Group’s 
financial results. These are clearly 
defined below.

> 

The rationale for using each APM is:
 Revenue growth (%) – This shows 
> 
the annual reported revenue growth. 
This highlights our potential ability 
to bolster our revenues based on 
different economic cycles
 Adjusted operating profit margin 
(%) – This shows the operating 
profit margin excluding significant 
items. The adjusted operating profit 
margin shows our recurring 
profitability capacity;
 Contribution – This is an important 
measure of our profitability; as it 
provides a view of front-office 
revenues less compensation and other 
front office costs (e.g. settlement and 
clearing fees). Increased contribution 
leads to increased returns for 
the shareholders
 Adjusted earnings per share (‘EPS’) 
– This shows the basic EPS of the 
Group excluding significant items. 
The adjusted EPS shows our recurring 
earnings capacity.

> 

> 

Adjusted earnings per share 
(‘EPS’) (p)

Senior Management Gender 
Diversity

.

0
6
2

.

6
3
2

9
1
0
2

0
2
0
2

KPI definition 
Ratio of female employees 
in our Executive and Non-
executive management 
(combined referred as Senior 
Management).

Comment 
The ratio of female employees 
in Senior Management teams 
is an indicator of our increasing 
focus on Employee Diversity 
and Inclusion. The ratio of 
female employees in our Senior 
Management teams has 
increased to 26%, 2.4 
percentage points higher year 
on year. This figure includes 
a notable 15.5% points 
increase in relation to our 
Executive team.

.

3
3
3

.

2
4
3

.

8
3
3

.

5
2
3

Non-Financial 
KPIs

7
1
0
2

8
1
0
2

9
1
0
2

0
2
0
2

KPI definition 
Adjusted earnings per share 
is calculated by dividing the 
adjusted profit after tax by 
the basic weighted average 
number of shares in issue. 
A reconciliation to statutory 
EPS is shown on page 30.

Comment 
Over the long term, growth in 
shareholder value and returns 
is linked to growth in adjusted 
EPS, which measures the 
adjusted profitability of the 
Group after tax and interest 
costs. The slight EPS decrease 
reflects the difficult operating 
environment year-on-year.

Link to our strategy
 > Electronification
 > Diversification

Annual Report and Accounts 2020
27

 
 
 
 
 
 
 
 
Financial and operating review

Robin Stewart 
Chief Financial Officer

In 2020, TP ICAP delivered a solid 
financial performance, demonstrating 
our strong operational capability 
and the growing success of our 
diversification strategy, against 
a difficult macroeconomic backdrop 
and reduced secondary volumes in 
the wider interdealer broker market.

Introduction 
During 2020, we faced a unique macroeconomic backdrop marked 
by the emergence and continuous impact of the COVID-19 pandemic. 

The pandemic led us to adjust our ambitious 2020 IT investment plan 
as our primary focus has been the well-being of our employees, the 
seamless provision of our services, the support of financial markets, 
and the protection of shareholders’ value.

This once-in-a-generation environment initially led to record 
volatility and boosted market volumes. This was especially 
pronounced in March, across all our broking products. However, 
market volumes materially softened as the year progressed, most 
notably during the summer months. This was due to the fact that 
governments started to lower interest rates to support the wider 
economy and restarted large quantitative easing programmes. 
In addition, traders appetite for risk decreased. 

Against this backdrop, Group revenues were slightly lower year-on-year 
on a reported and constant currency basis. This is a big testament 
of the success of our diversification strategy. Our high-growth 
businesses, Institutional Services and Data & Analytics offered high 
top-line growth, whilst Energy & Commodities continued to grow 
its market share and capitalise on specific market opportunities. 

Operating costs in 2020 have declined materially year-on-year 
following the completion of the integration of ICAP in 2019, reflected 
in a reduction in ‘Significant items’. Management adjusts for such 
items for planning purposes and measuring the Group’s performance, 
and to aid comparability from period to period. They are also useful 
measures for investors and analysts when considered together with 
reported results.

Despite our initial plans to invest heavily in our core strategy, 
COVID-19 meant that we re-prioritised investment in cloud 
technology and workflows to support our brokers to work from home. 
Despite these unplanned investments and other costs regarding 
recent acquisitions, we were able to reduce our overall management 
and support costs year-on-year by £9m (£4m on a constant currency 
basis), which included material bonus adjustments. This highlights our 
ability to adapt our cost base to various macroeconomic circumstances.

Looking forward, the proposed Liquidnet acquisition means that we 
will incur some non-recurring costs in 2021. However, we are all very 
excited to partner with Liquidnet as its cutting-edge technology, 
market-leading connectivity and well-known franchise will help us 
develop new, high-growth revenue streams.

Annual Report and Accounts 2020
28

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Key financial and performance metrics
Our key financial and performance metrics for 2020 are summarised in the table below together with comparatives from the equivalent 
period in 2019 on a reported basis. 

Total revenue (reported)
Reported operating profit
Reported operating margin
Adjusted operating profit5
Adjusted operating margin6
Broking contribution1,6
Broking contribution margin1,6
Data & Analytics contribution1,6
Data & Analytics contribution margin1,6
Total contribution6
Total contribution margin6
Global Broking adjusted operating profit margin7
Energy & Commodities adjusted operating profit margin7
Institutional Services adjusted operating profit margin7
Data & Analytics adjusted operating profit margin7
Average revenue per broker (£’000)2
Average contribution per broker (£’000)3
Average broker headcount 
Broker headcount – period end
Broker support headcount – period end
Other support headcount – period end
Broker compensation costs: broking revenue4

2020
£1,794m
£178m
9.9%
£272m
15.2%
£606m
36.3%
£74m
51.0%
£680m
37.9%
16.6%
13.6%
7.7%
44.1%
591
217
2,789
2,793
1,846
287
54.7%

2019
£1,833m
£142m
7.7%
£279m
15.2%
£626m
36.4%
£68m
50.4%
£694m
37.9%
17.5%
12.0%
4.0%
43.7%
620
228
2,740
2,784
1,824
300
53.1%

Change
-2%
+25%
+2.2% pts
-3%
0%pts
-3%
-0.1% pts
+9%
0.6% pts
-2%
0.0% pts
-0.9% pts
+1.6% pts
+3.7% pts
+0.4% pts
-5%
-5%
+2%
0%
+1%
-4%
+1.6% pts

1   Broking includes contribution from Global Broking, Energy & Commodities and Institutional Services. Figures include inter-division revenues in Global Broking and Energy 

& Commodities, and inter-division front-office costs in Data & Analytics. 

2  Average revenue per broker is defined as Total Broking revenues excluding inter-division revenues divided by average broker headcount.
3  Average contribution per broker represents broking contribution (as defined in the Contribution section) divided by the average broker headcount.
4  Broker compensation costs: broking revenue is defined as Total Broking compensation costs divided by Broking revenues excluding inter-division revenues.
5  Refer to reconciliation on page 30.
6  Refer to APM Appendix on page 200. 
7  Refer to reconciliation on page 37.

Average broker headcount was 2% higher to 2,789 in 2020 from 
2,740 in 2019 due to the acquisition of Louis Capital Markets (LCM) 
and the consolidation of our business in Malaysia. However, with 
a 5% decrease in average revenue per broker, the resulting broking 
revenue was 3% lower than 2019 on a reported basis (2% lower on 
a constant currency basis). The period-end broking support 
headcount increased 1% primarily reflecting in-sourcing (including 
Belfast), and investing in Risk and Compliance functions as a 
response to increasing regulatory demands.

The tables that follow analyse revenue by business division as 
well as revenue and adjusted operating profit by region for 2020 
compared with the equivalent period in 2019.

A significant portion of the Group’s activity is conducted outside 
the UK and the statutory revenue is therefore impacted by the 
movement in the foreign exchange rates used to translate the 
revenue from non-UK operations. The comparative data in the 
following tables therefore shows the statutory revenue change, 
but also the constant currency basis, where the 2019 revenues are 
translated at the same exchange rates as those used for 2020.

Annual Report and Accounts 2020
29

 
 
 
 
 
 
 
Financial and operating review 
continued

Income Statement
The Group presents its reported results in accordance with IFRSs as detailed in the financial statements on page 124. The Group also 
presents adjusted, non-IFRS, measures to report performance. Adjusted results and other alternative performance measures (‘APMs’) may 
be considered in addition to, but not as a substitute for, the reported results presented in accordance with IFRS. The Group believes that 
adjusted results and other APMs, when considered together with reported results, provide shareholders, analysts and other stakeholders 
with additional information to better understand the Group’s financial performance and compare financial performance from period to 
period. These adjusted measures and other APMs are also used by management for planning and to measure the Group’s performance. 
Management also uses adjusted measures to allow better comparability of information between operating segments. Investors and 
analysts should not rely on any single financial measure but should review the Annual Report, including the financial statements and notes, 
in their entirety. 

Reported results are adjusted for significant items, which are defined on page 34, to derive adjusted results. A reconciliation from 
reported to adjusted measures is provided in the table below. Other alternative performance measures are defined in an Appendix on 
pages 200 to 202.

For 2020, the Group’s adjusted and reported operating profit (or Earnings before interest and tax, ‘EBIT’) was £272m and £178m, versus 
£279m and £142m in the prior year. Reported operating profit (EBIT) increased by 25% due to a material reduction in the significant items. 
Adjusted operating profit (EBIT) decreased by 3% as lower revenues were only partially offset by lower costs.

£m
Revenue1
Employment, compensation and benefits
General and administrative expenses
Depreciation and impairment

of PPE and ROUA

Amortisation and impairment
of intangible assets

Impairment of other assets
Operating expenses1
Other operating income1
Operating profit (EBIT)1
Net finance expense1
Profit before tax
Tax1
Share of net profit of associates

and joint ventures

Non-controlling interests
Earnings attributable to the 
equity holders of the parent
Operating profit margin
Average number of shares
Basic EPS1

1  This figure is analysed in the following sections.

Adjusted
1,794
(1,147)
(333)

(36)

(20)
–
(1,536)
14
272
(49)
223
(55)

16
(1)

183
15.2%
557.0m
32.9p

2020

Significant 
Items
–
(6)
(27)

(1)

(39)
(23)
(96)
2
(94)
–
(94)
7

–
–

(87)
–
557.0m
(15.7p)

Reported
1,794
(1,153)
(360)

(37)

(59)
(23)
(1,632)
16
178
 (49)
129
(48)

16
(1)

96
9.9%
557.0m
17.2p

Adjusted
1,833
(1,134)
(380)

(33)

(23)
–
(1,570)
16
279
(49)
230
(55)

15
(1)

189
15.2%
559.4m
33.8p

2019

Significant
Items
–
(20)
(55)

(1)

(46)
(24)
(146)
9
(137)
–
(137)
15

–
–

(122)
–
559.4m
(21.8p)

Reported
1,833
(1,154)
(435)

(34)

(69)
(24)
(1,716)
25
142
(49)
93
(40)

15
(1)

67
7.7%
559.4m
12.0p

Annual Report and Accounts 2020
30

 
 
 
Revenue
Total revenue of £1,794m in 2020 was 2% lower than 2019 on a reported basis, and 1% lower at constant exchange rates. 2020 marked 
an unprecedented period due to the emergence of the COVID-19 pandemic. This created a turbulent and uncertain environment globally. 
Throughout the period, much management attention was given to ensuring the continuity of our business and the broader financial 
services markets across every location during the evolving stages of the pandemic. We were taking into account varying external 
requirements and the safety and welfare of our staff and the need to maintain an appropriate level of supervision of broking activities 
in working from home conditions.

Revenue by region and business division

By region
EMEA
AMERICAS
APAC

Reported revenues

By business division

Rates 
Credit
FX & Money Markets
Emerging Markets
Equities
Inter-division revenues1

Total Global Broking

Energy & Commodities
Inter-division revenues1
Total Energy & Commodities 
Institutional Services
Data & Analytics
Inter-division eliminations1
Reported revenues

2020
£m
888
670
236
1,794

510
90
186
183
201
18
1,188
388
3
391
91
145
(21)
1,794

2019
£m
900
687
246
1,833

537
94
201
213
199
18
1,262
379
3
382
75
135
(21)
1,833

Reported change

Constant currency 
change

-1%
-2%
-4%
-2%

-5%
-4%
-7%
-14%
0%
0%
-6%
+2%
0%
+2%
+21%
+7%
0%
-2%

-1%
-1%
-3%
-1%

-4%
-3%
-7%
-12%
+2%
0%
-5%
+3%
0%
+3%
+21%
+9%
0%
-1%

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

1 

Inter-division revenues have been received by Global Broking and Energy & Commodities to reflect the value of proprietary data provided to the Data & Analytics division. 
The broking inter-segmental revenues and Data & Analytics inter-segmental costs are eliminated upon the consolidation of the Group financial results.

Annual Report and Accounts 2020
31

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Financial and operating review 
continued

Regarding regional performance, EMEA revenue for the region 
decreased by 1% in 2020 compared with 2019 on a reported basis 
(1% lower on a constant currency basis), with mixed results in 
different asset classes. During 2020, our broking staff headcount 
increased to 1,266 mainly due to the Louis Capital Markets (LCM) 
acquisition and ICAP Oil hires. 

Emerging Markets were especially impacted due to the earlier 
impact of COVID-19. Finally, Equities revenues were flat on a 
reported basis (2% higher on a constant currency basis). Market 
was favourable for cash equities trading, but TP ICAP is geared 
to equity derivatives, which was very mixed especially during the 
summer months.

Americas revenues decreased by 2% in 2020 versus 2019 on a 
reported basis (1% lower on a constant currency basis). This was 
due to difficult market conditions for TP ICAP’s traditional Global 
Broking business, offset by strong growth in our growing 
Institutional Services and Energy & Commodities divisions. 

Revenue in Asia Pacific in 2020 versus 2019 decreased 4% on a 
reported basis (3% lower on a constant currency basis). This was 
driven mainly by a decline in Global Broking, partially offset by 
revenue increases in Energy & Commodities, Institutional Services 
and Data & Analytics. 

Regarding divisional performance, volatility indices spiked during 
the first quarter across a number of asset classes, including equities 
and energy. However, this trend largely reversed as the year 
progressed. Since May, we witnessed reduced volatility, a new 
round of quantitative easing, lowering interest rates and flattening 
yield curves. These trends are generally negative for our broking 
divisions. Despite this mixed environment, Energy & Commodities, 
Data & Analytics and Institutional Services performance remained 
strong. This performance was offset by subdued performances in 
Global Broking, especially in Emerging Markets.

We continued to recognise Inter-division revenue in Global Broking 
and Energy & Commodities to identify the value of data provided 
to the Data & Analytics division. 

Global Broking revenues were 6% lower on a reported basis (5% 
lower on a constant currency basis). Rates division shrunk by 5% on 
a reported basis (4% lower on a constant currency basis). While 
rates activity was strong during the first quarter, new measures of 
governments’ support globally, including interest rate reductions 
and quantitative easing, painted a weak picture since the summer. 
Conditions in credit markets were challenging for inter-dealer 
brokers, as a number of new competitors continued to gain market 
share and the issuance growth did not lead to high secondary 
trading. This led Credit revenue to decline 4% on a reported basis 
(3% lower on a constant currency basis). FX & Money Markets and 
Emerging Markets both saw revenue declines of 7% (7% on a 
constant currency basis) and 14% (12% on a constant currency basis) 
respectively compared with the prior year due to subdued client 
activity on lower volume and volatility.

Energy & Commodities revenue increased 2% on a reported basis 
(3% higher on a constant currency basis) compared to 2019 as 
market volatility provided a number of trading opportunities, 
especially between January and April. Revenues increased in most 
products, including Oil and Power. There was notable double-digit 
revenue growth in Gas and Environmental products. Other notable 
successes include the build-out of ICAP Oil business, Japanese 
Power, PVM US Gas & Power and Weather Derivatives.

Institutional Services revenue grew by 21% on a reported basis 
(21% higher on a constant currency basis) compared to 2019 on 
a broadened asset market coverage, expanded geographical 
presence and focusing on higher value electronic execution services. 
Revenues grew strongly in the key product lines, including exchange 
traded derivatives, equity derivatives, government bonds and FX. 
This performance was led by higher volatility and increased client 
demand. We also benefited from changing market dynamics as our 
agency execution model continues to gain ground. We continued to 
add new hires and accelerate our client onboarding processes, 
which have also improved the performance of the business. 

Data & Analytics revenue was 7% higher than 2019 on a reported 
basis (9% on a constant currency basis). Like most companies in the 
financial market data sector, we initially experienced a setback to 
growth earlier this year due to the impact of COVID-19. This was 
due to higher cancellation rates, deferral of clients’ new initiatives 
and regulators’ compliance dates for new regulations. However, 
the business recovered strongly through the second half of the year, 
producing double-digit growth for the last quarter. During 2020, 
we launched six new products, including our first Information 
product, started a direct-to-service service and expanded our 
Channel Partners to include the public cloud providers. We continue 
to show Inter-segmental revenues received by Global Broking and 
Energy & Commodities to reflect the value of proprietary data 
provided to the Data & Analytics division. These inter-division 
revenues are based on commercial terms benchmarked against 
third-party rates and rates charged by TP ICAP’s broking desks to 
third parties. 

The broking inter-division revenues and Data & Analytics inter-
division costs are eliminated upon the consolidation of the Group  
financial results.

Annual Report and Accounts 2020
32

Operating expenses
Total operating costs were £1,632m, which was 5% lower than in 2019 on a reported basis. Total adjusted operating costs of £1,536m in 
2020 were 2% lower than 2019 (1% lower on a constant currency basis (see Note 5 in the Financial Statements for further details)). This has 
been driven by a decrease in front office and management and support costs. 

Operating expenses

Broker compensation
Other front office costs
Data & Analytics costs

Total front office costs1

Other employment costs
Technology and related costs2
Premises and related costs2
Depreciation and amortisation3 
Other administrative costs2
Total management and support costs
Total adjusted operating costs
Significant items4:

Restructuring and other related costs
Disposals and acquisitions and investments in new 

businesses
Goodwill impairment
Settlements and provisions in connection with legal and 

regulatory matters
ICAP integration costs
Total operating expenses

2020  
£m
902
162
50
1,114
224
69
27
56
46
422
1,536
96
20

53
21

2
–
1,632

2019  
£m
900
193
46
1,139
215
59
26
56
75
431
1,570
146
12

57
24

19
34
1,716

Change  

£m Reported change 
0%
2
-16%
(31)
+9%
4
-2%
(25)
+4%
9
+17%
10
+4%
1
0%
0
-39%
(29)
-2%
(9)
-2%
(34)
-34%
(50)

Constant currency 
change
+1%
-14%
+9%
-1%
+5%
+19%
4%
0%
-38%
-1%
-1%
n/a

(84)

-5%

n/a

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

1  Presented in line with our divisional disclosures.
2 
3 
4  Split by type of operating cost in Note 4.

Included in general and administrative expenses
Includes depreciation and impairment of PPE and ROUA and Amortisation and impairment of intangibles.

The table above sets out administrative expenses on the basis 
reviewed by management, divided principally between front office 
and management and support costs. Front office costs have a 
larger variable component to them and are directly linked to the 
output of our brokers. 

Other front office costs have decreased by 16% (£31m) on a 
reported basis (14% lower on a constant currency basis). There 
were reductions of £22m in travel and entertainment and £5m 
lower expected credit losses on customer receivables, partly offset 
by higher telecommunications and information services costs.

The largest element of the front office is broker compensation 
and travel and entertainment. Other front office costs are 
telecommunications and information services, clearing and 
settlement fees as well as other direct costs. The remaining total 
cost base represents the management and support costs of 
the Group.

Broker compensation costs marginally increased on a reported 
basis (+1% at constant currency) due to the acquisition of LCM. 
Excluding this acquisition, broker compensation costs were flat at 
constant currency. This is despite lower revenues, due to the shift in 
revenue mix towards businesses with a higher compensation ratio, 
mainly to Energy & Commodities, but also Institutional Services 
which is still in growth mode. 

Overall, broker compensation ratio increased to 54.7% (+1.6% pts 
year-on-year). A proportion of the increase is due to the resulting 
decline in travel and entertainment caused by the pandemic during 
the year. Travel and entertainment costs are usually recharged 
to the brokers. This increases the broker compensation ratio but 
does not have an impact on contribution. The rest of the broker 
compensation ratio increase is due to the aforementioned revenue 
shift toward higher compensation ratio businesses.

The increase in front-office Data & Analytics costs of 9% on a 
reported basis (9% higher on a constant currency basis) reflects its 
investment to achieve top-line growth. 

The £9m increase in the other staff costs on a reported basis (£11m 
on a constant currency basis) reflect increased technology (£5m), 
risk (£1m) and legal and compliance (£1m) support costs as we 
enhance these functions to fulfil our increased IT strategic needs 
and ensure compliance in an ever-changing environment.

Technology and related costs includes the costs of all external 
technology services, including maintenance contracts, consultancy, 
market data services and communications costs. During 2020, these 
costs increased by £10m on a reported basis (£11m higher on a 
constant currency basis) due to a combination of planned increases 
regarding IT infrastructure modernisation, cyber and surveillance IT 
projects, other IT investments and COVID-19 related IT spending, 
such as investment in cloud services.

Annual Report and Accounts 2020
33

 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
  
 
 
 
 
 
 
 
 
 
Financial and operating review 
continued

The significant decrease in other administrative costs (£29m lower 
on a reported basis, £28m lower on a constant currency basis) 
includes lower corporate travel and entertainment (£4m), £9m 
lower consultancy and agency fees, lower Brexit costs (£3m), and 
lower currency exchange net losses arising on monetary assets and 
liabilities in the current year (£8m) compared to 2019.

Significant items
Significant items are material items, that may span several 
accounting periods, that are excluded from reported measures to 
allow better comparability of financial performance from period to 
period and give additional information to better understand the 
Group’s financial performance when considered together with 
reported results.

Total significant items amounted to £94m in 2020 (2019: £137m). 
Significant items include:

Restructuring and related costs of £20m (2019: £12m) arise from 
Restructuring and related costs arise from initiatives to reduce the 
ongoing cost base and improve efficiency in the business to enable 
the delivery of our strategic priorities. These initiatives are material 
in size and nature to warrant exclusion from adjusted measures. 
These initiatives may span several accounting periods. Costs for 
other smaller scale restructuring are retained within both reported 
and adjusted results. In 2020 the following restructuring and related 
costs were considered to be significant items:
(i)    £8m relating to the Group’s re-domiciliation to Jersey 

announced in December 2019. These were mainly professional 
advisory fees in readiness preparation of the Group leading up 
to the re-domiciliation which was successfully undertaken on 
26 February 2021. The nature of this project is one-off and costs 
are not expected to be incurred after 2021;

(ii)   £4m of premises related costs following various office 

integrations, mainly in relation to ongoing costs of maintaining 
property which became vacant or is available to be sub-let;
(iii)   £4m additional costs incurred from the restructuring of senior 

management within the Global broking division relating to the 
Group’s cost reduction reorganisation programme announced 
in November 2020;

(iv)  £2m relates to additional costs whilst transferring capabilities 

to our Belfast office which is part of the Group’s cost 
effectiveness programme; £1m of ongoing costs incurred in 
winding up the Group’s UK defined benefit which commenced 
in 2019 (£4m for 2019); and 

(v)   other employee long-term benefit costs of £1m relating to 

remeasurement of uninsured Group income protection liabilities 
(2019: £1m).

As adjusted results include the benefits of material restructuring 
programmes but some of the related costs have been excluded, 
they should not be regarded as a complete picture of the Group’s 
financial performance, which is presented in the reported results.

Disposals, acquisitions and investments in new businesses £53m 
(2019: £57m) Costs, and any related income, related to disposals, 
acquisitions and investments are transaction dependent and can 
vary significantly year-on-year, depending on the size and 
complexity of each transaction. These amounts, including the 
amortisation of intangible assets arising on consolidation, are 
excluded in deriving adjusted results to better reflect the trading 
performance of the Group and its segments. Amortisation of 
intangible assets arising on consolidation is treated in line with 
acquisition related costs, the exclusion of which normalises the 
impact of deal dependent pricing and allows better comparability 
of performance from period to period. Amortisation of purchased 
and developed software is retained in both the reported and 
adjusted results as these are considered to be core to supporting 
the operations of the business.

In 2020 the following disposal, acquisition and investment costs 
were considered to be significant items:,
(i)    acquisition costs of £11m related mainly to the proposed 

Liquidnet acquisition. For 2019, we incurred £6m principally 
for the Axiom, ClearCompress and LCM acquisitions;

(ii)   £39m (2019: £42m) relating to the amortisation of intangibles 

arising on acquisitions:

(iii)   Adjustments to deferred or contingent consideration of £2m 

(2019:£6m) arose mainly from changes in estimates relating to 
the Axiom acquisition, partly offset by changes in estimates on 
the LCM and ClearCompress acquisitions. The Group also 
impaired the carrying value of an investment in an associate 
by £1m. 

As adjusted results include the benefits of acquisitions but some of 
the related costs have been excluded, they should not be regarded 
as a complete picture of the Group’s financial performance, which 
is presented in the reported results.

Goodwill impairment as with other related acquisition costs 
and adjustments, management consider goodwill impairment 
separately due to significant variations year-on-year, to aid 
comparability of results. In H1 2020, the carrying value of the 
Asia-Pacific CGU has been written down by £21m (2019: £24m) 
(see note 13 on pages 148 and 149). 

Legal and regulatory matters Costs and recoveries, related to 
certain legal and regulatory cases are treated as significant items 
due to their size and nature. Management consider these cases 
separately due to the judgements and estimation involved, the 
costs and recoveries of which could vary significantly year-on-year. 

Recoveries £2m (2019: £9m) £2m was recovered from the CME 
Group under the terms of the ICAP acquisition and have been 
reported within other operating income. In 2019, £9m was 
recovered in relation to an employment-related legal settlement.

Annual Report and Accounts 2020
34

Regional Analysis
This section demonstrates the performance of the three Regions where TP ICAP operates by division in terms of revenues, contribution and 
operating profit.

2020 £m
Revenue
Total front-office costs
Contribution
Contribution margin 
Management and support costs
Other operating income
Adjusted operating profit (EBIT)1
Adjusted operating profit (EBIT) margin1

2019 £m
Revenue
Total front-office costs
Contribution
Contribution margin 
Management and support costs
Other operating income
Adjusted operating profit (EBIT)1
Adjusted operating profit (EBIT) margin1

1  Refer to reconciliation on page 30.

EMEA 
888 
(518)
370 
41.2%
(216)
6
160 
18.0%

EMEA 
900 
(524)
376 
41.8%
(222)
10
164 
18.2%

AMERICAS
670 
(442)
228 
34.0%
(135)
3 
96 
14.3%

AMERICAS
687 
(458)
229 
33.3%
(140)
5 
94 
13.7%

APAC
236 
(154)
82 
34.7%
(71)
5 
16 
6.8%

APAC
246 
(157)
89 
36.2%
(69)
1 
21 
8.5%

Total
1,794 
(1,114)
680 
37.9%
(422)
14 
272 
15.2%

Total
1,833 
(1,139)
694 
37.9%
(431)
16 
279 
15.2%

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

EMEA
Revenue for the region decreased by 1% in 2020 compared with 
2019 on a reported basis (1% lower on a constant currency basis), 
with mixed results in different asset classes. During 2020, our 
broking staff headcount increased to 1,260 mainly due to the 
Louis Capital Markets (LCM) acquisition and ICAP Oil hires. 

Global Broking revenues fell 6% versus 2019. Overall, the division 
had a very strong first half of 2020 with exceptional volatility levels 
in March and April, caused by the pandemic. However, since May, 
market dynamics reversed as many clients decided to reduce risk 
and close out position and government reduced interest rates to 
very low levels and restarted quantitative easing. In terms of 
products, Rates and FX reported lower revenues as strong H1 was 
offset by lowering interest rates and traders working from home as 
the year progressed. Emerging Markets revenues were materially 
lower year-on-year as many emerging market economies were hit 
hard by COVID-19, especially South Africa and Turkey.

Credit revenues increased during the year through higher primary 
issuance, stronger CDS and insurance markets, offset by weaker 
performance in some other products. Finally, Equities were slightly 
up year-on-year, primarily due to the LCM acquisition. LCM was 
able to offset the decline on Q2 dividend season that was severely 
impacted due to the pandemic.

Energy & Commodities revenues increased slightly year-on-year. 
This was materially due to the oil price volatility witnessed in the 
first half of the year. The second half saw some decline with less 
freight being transported around the world and continued 
uncertainty regarding forward contracts. The flight to gold enabled 
the precious metals business to have a very strong year. We 
continued to grow our ICAP brand with important hires in our 
oil products.

Institutional Services revenues saw a 17% increase versus 2019. The 
division expanded its EMEA product offering by opening a COEX 
Rates desk during the year as well as growing its exchange traded 
derivatives (ETD) business. 

Data & Analytics were less impacted by market volatility due to the 
nature of its subscription business. However, the broadening of its 
product range and customer base led to 9% revenue increase 
year-on-year.

Contribution margin for the region reduced by 0.6 percentage 
points to 41.2%, mainly due to lower revenues, increased costs 
associated with adjusting to a working from home environment 
and higher compensation ratio.

Adjusted operating profit in EMEA of £160m was 2% lower than 
2019, and with revenue down 1% on a reported basis (and 1% lower 
on a constant currency basis), the adjusted operating profit margin 
has decreased by 0.2 percentage points, to 18.0%. This was a result 
of reduced revenues, the completion of Louis Capital Markets 
acquisition and continuous investment in IT and Hub Strategies, 
offset by some reduction in the support head headcount.

Annual Report and Accounts 2020
35

 
 
 
 
 
 
 
Financial and operating review 
continued

Americas
Americas revenues decreased by 2% in 2020 versus 2019 on a 
reported basis (1% lower on a constant currency basis). This was 
due to difficult market conditions for TP ICAP’s traditional Global 
Broking business, offset by strong growth in our Institutional Services 
and Energy & Commodities divisions. 

Asia Pacific
Revenue in Asia Pacific in 2020 versus 2019 decreased 4% on a 
reported basis (3% lower on a constant currency basis). This was 
driven mainly by a decline in Global Broking, partially offset by 
revenue increases in Energy & Commodities, Institutional Services 
and Data & Analytics. 

Within the Global Broking business, the volatility in March and April 
boosted our first half markets. However, general market conditions 
worsened as the year progressed and clients reduced their risk 
appetite. Overall, Global Broking revenues declined 5% year-on-
year. All asset classes, excluding Equities, posted lower revenues 
versus 2019.

Rates revenues decreased by 10% as USD swaps and Treasuries 
markets weakened in the second half of the year. Rates continues 
to be the largest asset class in the Americas. Emerging Markets 
revenues were the worst performing class for 2020, as developing 
markets were asymmetrically affected by the pandemic and 
working offsite conditions.

Equities revenues were up marginally year-on-year due to new 
product development. While the cash equities market was very 
strong, equity derivatives faced a mixed year, affected by a slower 
Q2 dividend season. FX & Money Markets businesses saw small 
revenue declines in 2020, due to lower volatility levels and client 
de-risking in Forward FX. 

US fixed income markets remained subdued for inter-broker 
dealers, as market structure is changing and new market entrants 
surface. TP ICAP reported single-digit revenue decline. 

The Americas’ Energy & Commodities business demonstrated 
another strong year, with a 4% revenue increase. There were 
increased revenues in oil and gas businesses. Energy & Commodities 
continues to be a targeted growth area for TP ICAP Americas across 
all our brands.

Finally, TP ICAP’s Institutional Services was the standout performer 
of the Americas’ region in 2020, with 29% revenue growth. The 
business expanded its product offerings and it remains an area for 
growth opportunities.

Contribution margin improved 0.6 percentage points to 14.3%, as 
lower revenues were more than offset by materially lower travelling 
and entertainment. 

In the Americas, the adjusted operating profit of £96m is 2% higher 
than 2019 but the adjusted operating profit margin has increased 
by 0.6 percentage point to 14.3% on higher contribution margin 
and tight cost management, partially offset by continuous 
investment in IT and Hub Strategies.

Global Broking revenue declined year-on-year by 8% to £184m. The 
year started healthily but going into the second quarter, the impact 
of the pandemic began to cause a reduction in risk appetite and 
trading volumes. A low interest rate environment, especially in 
Australia where rates got capped during the year, kept market 
volumes at muted levels. Japanese markets were relatively quiet 
after the first quarter and remained slow throughout the year. 
During the year, we undertook a review of underperforming desks 
and took some actions, including targeted compensation 
adjustments and selected staff exits where appropriate, while 
maintaining our service to customers across all key asset classes. 
This review led to limited impact on revenue but was positive on 
Asia Pacific’s contribution rate. During the year, we took majority 
control of our Malaysian business and started to consolidate it to 
our regional revenues. 

Energy & Commodities revenue grew by 11% year-on-year. This 
reflected the benefit of a number of recently established desks as 
we have increased the scale and diversification of our business. 
These new desks brought in new revenue and included TP middle 
distillates, PVM Gasoline, and ICAP branded Precious Metals. 
Importantly, the competing desks already operating under other 
brands continued to perform well.

Institutional Services initiated FX Option business in Singapore in 
2019 and this business continued to develop during 2020, though at 
a relative low pace given similar headwinds to those affecting the 
Global Broking business. 

The overall contribution margin decreased year-on-year by 1.6% 
from 36.3% to 34.7%. This deterioration in contribution rate arose 
in Global Broking, Energy & Commodities and also from the impact 
of starting up the Institutional Services business.

Adjusted operating profit in Asia Pacific decreased to £16m in 2020 
(£5m lower than in 2019), while the adjusted operating profit 
margin has reduced by 1.7 percentage points to 6.8% with the 
benefit of reductions in management and support costs as a result 
of the integration being more than offset by revenue decline and 
costs relating with the scaling of Institutional Services. 

Contribution margin declined 1.5 percentage point to 34.7%. This 
deterioration is contribution rate arose due to lower revenues in 
Global Broking, but also from the impact of starting up the 
Institutional Services business.

Overall, adjusted profit margin of 6.8% in 2020 was lower than the 
8.5% 2019 margin, as lower revenues and contribution, combined 
with central allocations regarding IT investments could not be offset 
by support cost savings.

Annual Report and Accounts 2020
36

2020 £m
Revenue:
 > External
 > Inter-division1
Total front-office costs
 > External
 > Inter-division1
Contribution
Contribution margin
Management and support costs
Other operating income
Adjusted operating profit (EBIT)
Adjusted operating profit (EBIT) margin
Significant items
Reported operating profit (EBIT)
Reported operating profit (EBIT) margin 

2019 £m
Revenue:
 > External
 > Inter-division1
Total front-office costs
 > External
 > Inter-division1
Contribution
Contribution margin (%)
Management and support costs
Other operating income
Adjusted operating profit (EBIT)
Adjusted operating profit (EBIT) margin
Significant items
Reported operating profit (EBIT)
Reported operating profit (EBIT) margin

Global  
Broking 
1,188 
1,170 
18 
(734)
(734)
– 
454 
38.2%
(260)
3 
197 
16.6%

Global  
Broking
1,262
1,244
18
(775)
(775)
–
487
38.6%
(268)
2
221
17.5%

Energy & 
Commodities
391 
388 
3 
(261)
(261)
– 
130 
33.2%
(78)
1 
53 
13.6%

Energy & 
Commodities
382
379
3
(261)
(261)
–
121
31.7%
(75)
–
46
12.0%

Institutional 
Services
91 
91 
– 
(69)
(69)
– 
22 
24.2%
(15)
– 
7 
7.7%

Institutional 
Services
75
75
–
(57)
(57)
–
18
24.0%
(15)
–
3
4.0%

Data &  
Analytics
145 
145 
– 
(71)
(50)
(21)
74 
51.0%
(10)
– 
64 
44.1%

Data &  
Analytics
135
135
–
(67)
(46)
(21)
68
50.4%
(9)
–
59
43.7%

Corporate 
Centre
(21)
– 
(21)
21 
– 
21 
– 

(59)
10 
(49)
n/a

Corporate 
Centre
(21)
–
(21)
21
–
21
–
n/a
(64)
14
(50)
n/a

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Total
1,794 
1,794 
– 
(1,114)
(1,114)
– 
680 
37.9%
(422)
14 
272 
15.2%
(94)
129
9.9%

Total
1,833
1,833
–
(1,139)
(1,139)
–
694
37.9%
(431)
16
279
15.2%
(137)
142
7.7%

1 

Inter-division charges have been made by Global Broking and Energy & Commodities to reflect the value of proprietary data provided to the Data & Analytics division.

Annual Report and Accounts 2020
37

 
 
 
 
 
 
 
Financial and operating review 
continued

Divisional Analysis
This section demonstrates the performance of TP ICAP Group by 
division in terms of revenues, contribution and operating profit. 
The  broking inter-segmental revenues and Data & Analytics 
inter-segmental costs are eliminated upon the consolidation of the 
Group financial results. Broker contribution (excluding Data & 
Analytics) declined 3% to £606m, as higher contribution from 
Energy & Commodities and Institutional Services was offset by 
lower contribution from Global Broking, due to lower revenues and 
higher ICP amortisation.

Contribution represents the revenue of our businesses less the total 
front office costs described above. An improvement in the absolute 
level of contribution is an important metric in driving earnings 
growth for the Group. In 2020 the overall level of contribution was 
2% lower at £680m year-on-year. The overall contribution margin 
was flat at 37.9% as lower revenues were more than offset by lower 
front office costs. There was some broker compensation ratio 
increase, due to revenue shift changes and lower travel and 
entertainment that is usually recharged to the brokers, offset by 
lower discretionary bonuses and lower clearing and settlement fees.
TP ICAP’s adjusted operating profit (EBIT) of £272m is 3% lower 
than the prior year, as lower revenues were only partially offset by 
lower front office and net management and support cost savings. 
The operating profit (EBIT) margin stayed flat at 15.2%. 

Global Broking revenues were 6% lower on a reported basis 
(5% lower on a constant currency basis). Following a strong first 
quarter, activity significantly abated as the year progressed. This 
led to a weaker performance in most asset classes. Rates, FX & 
Money Markets, Emerging Markets and Credit. This performance 
was only partially offset by small growth in Equities.

Lower revenues led to a small 0.4% pts decline in contribution 
margin, as the impact of smaller top-line was absorbed by lower 
discretionary bonuses, lower travel and entertainment and lower 
clearing and settlement fees. 

The adjusted operating profit (EBIT) decreased to £197m, or 11% 
lower versus 2019. This was a result of reduced revenue, increased 
costs associated with adjusting to a working from home environment 
for many staff, the region becoming Brexit ready, the Louis Capital 
Markets (LCM) acquisition and continued investment in IT, Cyber 
and Risk & Compliance costs and our Hub strategy. Operating 
profit (EBIT) margin decreased 0.9 percentage points to 16.6%.

Energy & Commodities revenues increased 2% on a reported basis 
(3% higher on a constant currency basis) compared to 2019 as 
market volatility provided a number of trading opportunities, 
especially between January and April. Revenues increased in most 
products, including Oil and Power. There were notable double-digit 
revenue growth in Gas and Environmental products.

Contribution increased 7% year-on-year to £130m, mainly due to 
higher revenues offset mainly through the broker compensation 
ratio increase, due to revenue shift changes, combined with higher 
initial contract payments (‘ICP’) amortisation.

The adjusted operating profit (EBIT) increased to £53m, or 15% 
higher versus 2019. This is primarily due to higher revenues, supported 
by some front-office, management related savings and contract 
re-negotiations partially offset by higher ICP. The adjusted operating 
profit (EBIT) margin improved 1.6 percentage points to 13.6%.

Institutional Services revenue grew by 21% on a reported basis 
(21% higher on a constant currency basis) compared to 2019 on a 
broadened asset market coverage, expanded geographical presence 
and focusing on higher value electronic execution services. Revenues 
grew strongly in the key product lines, including exchange traded 
derivatives, equity derivatives, government bonds and FX. This 
performance was led by higher volatility, increased client demand 
but also stemming from changing market dynamics as our agency 
execution model continues to gain ground and investment banks 
continue to reorganise their sales coverage teams. We continued 
to add new hires and accelerate our client onboarding processes, 
which have also improved the performance of the business. 

Contribution increased to £22m, with contribution margin 
increasing slightly by 0.2% pts to 24.2%. The increase is due 
to strong revenue growth, offset by higher trading costs, 
compensation and IT costs as we continue to build scale.

Institutional Services improved its adjusted operating profit (EBIT) 
to £7m (233% higher year-on-year). The business continues to 
generate necessary scale to improve its profitability, with very 
strong revenue growth. The adjusted operating profit (EBIT) margin 
improved to 7.7%, 3.7 percentage points higher year-on-year.

Annual Report and Accounts 2020
38

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Tax
The effective rate of tax on reported profit before tax is 37% (2019: 
43%), reflecting the tax deductibility of certain expenditure classed 
as significant items. The effective rate of tax on adjusted profit 
before tax is 24.7% (2019: 23.9%). The rate is consistent with the 
outlook previously given, noting that the prior year effective tax 
rate was lower due to a greater impact from the conclusion of prior 
year tax liabilities at less than the amount provided. 

Basic EPS
The average number of shares used for the basic EPS calculation of 
557m reflects the 563.3m shares in issue less the 4.5m shares held by 
the Employee Benefit Trust at the beginning of the year, less the 
difference between the time apportionment element of the 4.8m 
of shares acquired by the Employee Benefit Trust to satisfy deferred 
share awards made to senior management, and the 0.7m of 
deferred shares meeting their vesting requirements in June. 
The Employee Benefit Trust has waived its rights to dividends. 
Post year-end, the number of shares in issue increased to 788m 
due to the rights issue that was completed on 16 February 2021.

Dividend
For 2020, the Group proposes a full-year dividend per share (‘DPS’) 
of 6p that equates to £47m (2019 DPS: 11.9p, rebased to take into 
account the bonus element of the rights issue completed on 
16 February 2021), a one-off c.50% reduction to the prior year. 
This reduction will help fund the Liquidnet acquisition and minimise 
dilution of earnings on a per share basis. For 2021 onwards, we will 
target a dividend cover of approximately 2x adjusted earnings. 
The new dividend policy reflects a balanced approach to capital 
allocation and is expected to allow TP ICAP to drive growth, while 
allowing dividends to increase in line with adjusted earnings. 

Data & Analytics revenue was 7% higher than 2019 on a reported 
basis (9% on a constant currency basis). Like most companies in the 
financial market data sector, we initially experienced a setback to 
growth earlier this year due to the impact of COVID-19. This was 
due to higher cancellation rates, deferral of clients’ new initiatives 
and regulators’ compliance dates for new regulations. However, 
the business recovered strongly through the second half of the year, 
producing double-digit growth for the last quarter. During 2020, we 
launched six new products, including our first Information product, 
started a direct-to-service service and expanded our Channel 
Partners to include the public cloud providers. We continue to show 
Inter-segmental charges made by Global Broking and Energy & 
Commodities to reflect the value of proprietary data provided to 
the Data & Analytics division. These inter-division charges are 
based on commercial terms benchmarked against third-party rates 
and rates charged by TP ICAP’s broking desks to third parties.

Data & Analytics contribution represents the revenue of the Data & 
Analytics business less the total front office costs associated with 
running the business, including the cost of internally generated data 
from the broking businesses. In 2020, Contribution improved to £74m 
(9% higher year-on-year) mainly due to higher revenues, as Data & 
Analytics continues to build scale, launching new higher-value 
products, improving distribution channels and increasing the number 
of clients in the buy-side and the sell-side. Contribution margin 
increased to 51.0% or 0.6 percentage points higher year-on-year.

Finally, Data & Analytics reported strong adjusted operating profit 
(EBIT) of £64m, or 8% higher versus 2019. The results benefited from 
strong revenue growth and positive operational leverage. As such, 
the adjusted operating profit (EBIT) margin improved to 44.1%, 
0.4 percentage points higher year-on-year.

Net finance expense
The reported net finance expense, finance costs less finance 
income, of £49m is in line with the £49m charged in 2019, as lower 
finance costs were offset by lower interest income. Interest expense 
was £52m, of which £36m relates to the Group’s Sterling Notes, £3m 
of bank facility costs, £1m relating to the amortisation of debt issue 
and bank facilities and £1m of other interest payable. The interest 
expense includes £11m interest payable on IFRS16 lease liabilities. 
The expense is offset by £2m of interest income and £1m of income 
of finance lease receivables.

Annual Report and Accounts 2020
39

 
 
 
 
 
 
 
Financial and operating review 
continued

Cash flow

2020 £m
Operating profit (EBIT)
Share-based payment charge and pension scheme administration fees
Depreciation and amortisation
Depreciation on leased assets
Non-cash items
Impairment and amortisation of intangible assets arising on consolidation
Change in initial contract prepayments
Working capital 
Cash generated from operations
Capital expenditure
Operating cash flow
Interest paid
Tax paid
Free cash flow

Cash flow

2019 £m
Operating profit (EBIT)
Share-based payment charge and pension scheme administration fees
Depreciation and amortisation
Depreciation on leased assets
Non-cash items 
Impairment and amortisation of intangible assets arising on consolidation
Change in initial contract prepayments
Working capital 
Cash generated from operations
Capital expenditure
Operating cash flow
Interest paid
Tax paid
Free cash flow

Adjusted
272
9 
33
23 
– 

(4)
(28)
305
(53)
252
(53)
(80)
119

Significant items
(94)
(1) 
– 
– 
5 
60 
–
(5)
(35)
–
(35)
–
7
(28)

Adjusted
279
6
36
20
1
–
(2)
(21)
319
(33)
286
(53)
(73)
160

Significant items
(137)
3
4
1
6
66
2
1
(54)
–
(54)
–
9
(45)

Reported
178
8 
33 
23 
5 
60 
(4)
(33)
270 
(53)
217
(53)
(73)
91

Reported
142
9
40
21
7
66
–
(20)
265
(33)
232
(53)
(64)
115

Cash flow statement 
The cash flow presentation reconciles the adjusted cash flow 
generation, excluding the impact of significant items, to the 
reported net cash flow from operations. The impact on EBITDA of 
significant items was £30m mainly due to acquisition and business 
reorganisation costs. 

During the year, there was a 6% decline in reported operating cash 
flow of, as higher reported operating profit (EBIT) was offset by 
higher initial contract prepayments (ICP), changes in working 
capital and incremental capital expenditure regarding our new 
London Headquarters and investment in IT.

During the period there was a small increase in initial contract 
prepayments. The working capital outflow of £28m which mainly 
reflects the reduced management and support bonuses and 
associated payroll taxes. Capital expenditure has increased to 
£53m reflecting incremental spending on our new London 
Headquarters and continued IT spending on routine, mandatory 
and investment projects.

After interest paid and adjusted taxation paid, the adjusted free 
cash flow for the Group was £119m, a decrease of £41m year-on-
year, mainly due to higher capital expenditure.

The revolving credit facility provided by a syndicate of banks was 
refinanced in December 2018 on improved terms increasing our 
overall facility to £270m from £250m. The main revolving credit 
facility now matures in December 2023, and no cash was drawn 
as at the period end (2019: £0m). 

In August 2020 the Group entered into a revolving credit facility 
with a related party, Tokyo Tanshi Co., Ltd. (‘Totan’) for JPY 10bn 
(c.£71m) with an initial maturity of two years. This facility can be 
extended for six months by mutual agreement semi-annually. 
The current maturity date is 27 February 2023. JPY 4bn (£28m 
equivalent) was drawn as at the period-end. During 2020, 
no refinancing actions were carried out on the bonds issued by 
the Group under its £1bn Euro Medium Term Note Programme. 
The amounts of bonds outstanding remain £250m 5.25% Notes 
due 2026 (2019: £250m) and £431m 5.25% Notes due 2024 
(2019: £431m).

Annual Report and Accounts 2020
40

Cash, cash equivalents and financial investments
Of the £783m cash and financial investments balance at the period 
end, £687m is held in 74 regulated entities to meet regulatory 
capital, margin and other trading requirements as well as accrued 
profits, £86m is held in non-regulated entities for working capital 

requirements as well as accrued profits and £10m is held in 
corporate holding companies. The £687m of cash held in regulated 
entities generally remains held within those Group’s entities for 
regulatory and operational reasons.

Debt finance
The composition of the Group’s outstanding debt is summarised below.

£m
5.25% Sterling Notes January 2024
5.25% Sterling Notes May 2026
Revolving credit facility – Banks 
Revolving credit facility – Totan
Overdraft
Unamortised debt issue costs
Accrued interest
Gross Debt pre-IFRS 16
IFRS 16 lease liabilities
Total Debt

At 31 Dec
2020
431
250
–
28
7
(2)
11
725
212
937

At 31 Dec
2019
431
250
–
–
–
(2)
11
690
140
830

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Exchange rates
The income statements and balance sheets of the Group’s 
businesses whose functional currencies are not GBP are translated 
into Sterling at average and period end exchange rates 
respectively. The most significant exchange rates for the Group 

are the US Dollar and the Euro. The Group’s current policy is not to 
hedge income statement or balance sheet translation exposure. 
Average and period end exchange rates used in the preparation 
of the financial statements are shown below. 

US Dollar
Euro

Pensions
The Group has one defined benefit pension scheme in the UK that 
is currently in the process of being wound up. 

The Sponsor and Trustee commenced the wind-up of the Scheme in 
2019 to enable the Trustee to exchange the Scheme’s bulk annuity 
policy for individual policies that will be held directly by the 
Scheme’s beneficiaries, in a process known as a ‘buy-out’. Under 
UK legislation, once a Scheme commences wind-up, the assets of 
the Scheme pass unconditionally to the Trustee to enable it to settle 
the Scheme’s liabilities. As a result, the Group has applied the 
requirement of IFRIC 14, fully restricting the Group’s recognition of 
the £49m (2019: £52m) net surplus by applying an asset recognition 
ceiling. The asset ceiling is recorded as a charge in other 
comprehensive income.

Average

Period end

 2020
$1.29
€1.13

2019
$1.28
€1.14

2020
$1.37
€1.12

2019
$1.32
€1.18

During the wind-up period, the Group will continue to restrict the 
recognition of the net surplus. Should any member benefits be 
augmented during this period, they will represent a past service cost 
and will be recorded as a significant item in the Income Statement 
as and when those benefits are agreed. Costs associated with the 
settlement of the Scheme’s liabilities will also be recorded as a 
significant item in the Income Statement as and when incurred. Past 
service and settlement costs amounted to £1m in 2020 (2019: £3m).

Following the full settlement of the Scheme’s liabilities the Scheme 
will be wound-up and the Sponsor expects to receive the remaining 
asset. Any repayment received will also be subject to applicable 
taxes at that time, currently 35%.

Annual Report and Accounts 2020
41

 
 
 
 
 
 
 
Financial and operating review 
continued

Regulatory capital 
As at 31 December 2020 the Group’s lead regulator was the FCA. 
Following the Group’s redomiciliation to Jersey as of 26 February 
2021, the Group now falls under the regulation of the Jersey 
Financial Services Commission. 

As at 31 December 2020 the Group held an FCA waiver from the 
consolidated capital adequacy requirements under CRD IV. The 
waiver took effect on 30 December 2016, following the acquisition 
of ICAP, with an expiry of 30 December 2026. Under the terms of 
the waiver, each investment firm within the Group must be treated 
as either a limited activity or a limited licence firm and comply with 
its individual regulatory capital resources requirements. TP ICAP 
plc, as the parent Company as at 31 December 2020, must continue 
to maintain capital resources in excess of the sum of the solo 
notional capital resources requirements for each relevant firm 
within the Group (the ‘Financial Holding Company test’). The terms 
of the waiver require the Group to eliminate the excess of its 
consolidated own funds requirement compared with its 
consolidated own funds (‘Excess Goodwill’) over the ten-year period 
to 30 December 2026. The amount of the Excess Goodwill must not 
exceed the amount determined as at the date the waiver took 
effect (the ‘Excess Goodwill Ceiling’). The Excess Goodwill Ceiling is 
reduced to nil in line with a schedule over ten years to December 
2026, with the first reduction of 25% having occurred at the end 
of June 2019. The Excess Goodwill Ceiling continues to reduce 25% 
every 2.5 years on a straight-line basis. The waiver also sets out 
conditions with respect to the maintenance of financial ratios 
relating to leverage, debt service and debt maturity profile.

As at 31 December 2020, the Group’s regulatory capital headroom 
under the Financial Holding Company test calculated in 
accordance with Pillar 1 was £1,550m (2019: £1,591m). Many of the 
Group’s broking entities are regulated on a ‘solo’ basis, and are 
obliged to meet the regulatory capital requirements imposed by 
the local regulator of the jurisdiction in which they operate. The 
Group maintains an appropriate excess of financial resources in 
such entities.

Information disclosure under Pillar 3 is available on the Group’s 
website: www.tpicap.com. 

Following the redomiciliation to Jersey, the Group will no longer be 
subject to the consolidated capital adequacy requirements under 
CRD IV and as a result the ‘Financial Holding Company test’ and 
CRD IV waiver requirements of the FCA are no longer applicable. 
The FCA has become the lead regulator of the Group’s sub-
consolidated activities, legally headed by the UK, for which the 
consolidated capital adequacy requirements under CRD IV now 
apply. This sub-group has not applied for a waiver as the sub-group 
maintains an appropriate excess of financial resources.

Annual Report and Accounts 2020
42

Viability statement and going concern

Viability statement 
The Directors have assessed the prospects for, and viability of, 
the Group over a three-year period to the end of December 2023. 

We believe that a three-year time horizon remains the most 
appropriate timeframe over which the Directors should assess the 
long-term viability of the Group. This is on the basis that it has a 
sufficient degree of certainty in the context of the current position 
of the Group and the assessment of its principal risks, and it 
matches the business planning cycle.

The assessment has been made taking into account the following:

 > the Assessment of the Group’s Principal Risks, including those 

that would threaten the Group’s business model, future 
performance, solvency and liquidity. These risks are also 
discussed in the risk management report on pages 44 to 49;

 > the Group Internal Audit Opinion that contains an assessment of 
the effectiveness of the Group’s risk management and internal 
control systems;

 > the Going Concern Review that assesses whether the Group has 

access to sufficient liquidity to meet all of its external obligations 
and operate its business, for a period of at least 12 months from 
the date of the Annual Report;

 > the Group Review of Capital and Liquidity Adequacy (‘GRCLA’) 
that assesses the capital and liquidity position of the Group on 
a consolidated basis, in both base and stressed conditions;

 > the Review of Internal Capital Adequacy Assessment Processes 
(‘ICAAP’) undertaken by certain operating entities within the 
Group, most notably the UK regulated entities; and
 > the assessment of the Group’s external credit rating by 

Fitch Ratings.

The Directors consider that they have undertaken a robust 
assessment of the prospects of the Group and its principal risks over 
a three-year period, and, on the basis of that assessment, have a 
reasonable expectation that the Group will be able to continue in 
operation and meet its liabilities as they fall due over at least the 
period of assessment.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

In arriving at this conclusion, the Directors have made the following 
assumptions:

 > the Group maintains access to liquidity through the Group’s 

£270m Bank revolving credit facility and c.£71m Totan revolving 
credit facility (see Note 24 on page 159);

 > the Group does not experience any material change in its capital 
or liquidity requirements, including as a result of any changes 
introduced by the new prudential regimes for investment firms to 
be introduced in the UK and EU (IFPR and IFR/IFD respectively);
 > the Group takes appropriate actions to maintain continuity of 
operations in the EU following the UK’s departure from the EU 
and to mitigate the potential adverse effects arising from Brexit, 
including the potential fragmentation of liquidity and 
consequential reduction in trading volumes; and

 > the Group is not materially impacted from litigation and 

regulatory investigations in a negative way.

Going concern
The Group has sufficient financial resources both in the regions and 
at the corporate centre to meet the Group’s ongoing obligations. 
The Directors have assessed the outlook of the Group, including 
consideration of the enlarged Group following the anticipated 
acquisition of Liquidnet, for at least 12 months from date of 
approval of the financial statements by considering medium-term 
projections as well as stress tests and mitigation plans. These 
forecasts and stress tests take into account both the ongoing 
COVID-19 pandemic and Brexit. Additionally, the Directors have 
considered the ongoing strategy for the Company following the 
announcement that the Scheme became effective on 26 February 
2021 when the Company ceased being the parent company of the 
Group. Based on this assessment1 the Directors have a reasonable 
expectation that the Company and the Group have adequate 
resources to continue in operational existence for the foreseeable 
future. Accordingly, the Annual Report and Financial Statements 
continue to be prepared on the going concern basis. 

1  Please refer to the Legal Statement on the contents page.

Annual Report and Accounts 2020
43

 
 
 
 
 
 
 
Risk management

Effective risk management is essential to the financial strength and 
resilience of the Group and for delivering its business strategy. This 
section provides a summary of how risk is managed by the Group 
through its enterprise risk management framework (‘ERMF’) and 
describes the Group’s principal risks. 

Enterprise risk management framework
The purpose of the ERMF is to enable the Group to understand the 
risks to which it is exposed and to manage these risks in line with its 
stated risk appetite. The ERMF achieves this objective through the 
implementation of three mutually reinforcing components: a sound 
risk management culture, a comprehensive risk management and 
governance structure, and a range of risk management processes. 
The Group has recently completed a range of actions to develop 
and implement its new risk management framework to ensure that 
its risk management capability appropriately reflects the scale and 
diversity of the Group’s business activities and is in line with 
regulatory requirements. 

Risk culture 
The Group recognises that in order to ensure the effective operation 
of the ERMF, it must implement an appropriate risk management 
culture that fosters the desired risk management values and 
behaviours, and that is aligned to TP ICAP’s values. This includes 
promoting an environment of openness that encourages the 
reporting and discussion of risk related matters and incidents. 

The Group seeks to achieve the implementation of its risk 
management culture through a range of actions. These include the 
setting of an appropriate ‘tone-from-the-top’, clear communication 
of risk management expectations and responsibilities, and through 
remuneration structures that effectively support the achievement of 
the desired risk management behaviours.

Risk management and governance structure 
The Group has implemented a risk management and 
governance structure whereby risks are managed through a 
three lines of defence model that segregates risk management 
(first line of defence) from risk oversight (second line of defence) 
and independent risk assurance (third line of defence), with 
oversight provided through a formal risk committee structure. 

The Board has overall responsibility for the management of risk 
within the Group which includes:

 > defining the nature and extent of the risks it is willing to take 

in achieving its business objectives through formal risk 
appetite statements; 

 > ensuring that the Group has an appropriate and effective risk 

management and internal control framework; and 

 > monitoring the Group’s risk profile against the Group’s defined 

risk appetite.

The Group’s risk governance structure oversees the operation 
of the ERMF across the Group and comprises the following 
committees:

 > Board Risk Committee;
 > Group Risk, Culture and Conduct Committee; and
 > Regional Risk, Culture and Conduct Committees in EMEA, 

Americas and Asia Pacific.

First line of defence
Risk management within the business
The first line of defence comprises the management of the business 
units and support functions.

The first line of defence has primary responsibility for ensuring that 
the business operates within risk appetite on a day-to-day basis.

Second line of defence
Risk oversight and challenge
The second line of defence comprises the Compliance and Risk 
functions, which are separate from operational management.

The Compliance function is responsible for overseeing the Group’s 
compliance with regulatory requirements in all of the jurisdictions in 
which the Group operates. 

The Risk function is responsible for overseeing and challenging 
the business, support and control functions in their identification, 
assessment and management of the risks to which they are 
exposed, and for assisting the Board (and its various committees) 
in discharging its overall risk oversight responsibilities.

Third line of defence
Independent assurance
Internal Audit provides independent assurance on the design 
and operational effectiveness of the Group’s risk management 
framework and associated activity.

Annual Report and Accounts 2020
44

Risk management processes
The ERMF sets out the core risk management activities undertaken by the Group to identify, assess and manage its risk profile within the 
prescribed risk appetite.

Capital and 
liquidity 
assessment

Stress and 
scenario 
analysis

Risk 
response

Risk 
governance

Business 
and risk 
strategy

Risk 
identiﬁcation

Risk 
culture 

Risk 
appetite

Risk 
assessment 
and 
evaluation

Monitoring 
and 
reporting

Policies 
and controls

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Risk strategy and risk appetite
The Board is responsible for setting its risk strategy and risk appetite which together provide the overarching context for the Group’s risk 
management activity. 

The Risk Strategy defines the risk objectives which must be met for the Group to achieve its Business Strategy and ensure that the Group 
focuses on those risk issues which are of most significance to the Group. The Group has defined the following risk objectives:

Category
Financial position

Operational effectiveness 
and resilience
Regulatory standing

Reputation

Business strategy

Summary statement
To maintain a robust financial position in both normal and stressed conditions, to be achieved 
by maintaining profitability, ensuring capital resources and liquidity resources are sustained at 
levels that reflect the Group’s risk profile, and maintaining access to capital markets.
To ensure that operational processes and infrastructure operate effectively and with an 
appropriate degree of resilience. 
To comply with applicable legal and regulatory frameworks, and maintain good standing with 
regulators, across all jurisdictions in which the Group operates.
To maintain the Group’s reputation as an unbiased intermediary in the financial markets, with 
market integrity and the fair treatment of clients being at the heart of its business. 
To adopt and execute a well-defined business plan which ensures the continued viability and 
growth of the Group’s business, and to ensure that the Group does not undertake any activity 
which could undermine its ability to meet its strategic goals.

The Risk Appetite Statement provides the Board’s strategic view of the Group’s attitude to, and appetite for, particular risk types to inform 
the more detailed articulation and operationalisation of risk appetite throughout the Group. The Group implements its risk appetite 
statements through the adoption of risk metrics and thresholds at individual risk level. These thresholds constitute the operational 
parameters within which the first line of defence must operate on a day-to-day basis.

The risk strategy and risk appetite are reviewed by the Board on at least an annual basis and more frequently where required to address 
a change in the Group’s business or risk profile.

Annual Report and Accounts 2020
45

 
 
 
 
 
 
 
Principal risks and uncertainties
Principal risks and uncertainties

The Board has conducted a robust assessment of the principal risks 
facing the Group, including those that would threaten its business 
model, future performance, solvency or liquidity, and reputation. 

This assessment has been informed by a wide range of information, 
including reports provided by the Group Risk function and senior 
management, as well as key findings from the Group’s various risk 
assessment processes.

The Group formally reviews its risk profile on a bi-annual basis in 
light of its current business profile and potential changes arising 
from its business strategy and records these risks within the Group’s 
Risk Register. 

The Group then formally assesses the risk profile of these risks 
through the Group’s Risk Self-Assessment (‘RSA’) process against the 
target residual risk profile defined in the Group’s risk appetite 
framework, by reference to both probability and severity. 

Description

Risk
1. Strategic and Business Risk
Adverse change 
to regulatory 
framework

The Group is exposed to the risk of a fundamental 
change to the regulatory framework which has a 
material adverse impact on its business and 
economic model.

Deterioration in 
the commercial 
environment

The risk that due to adverse macro-economic conditions 
or geopolitical developments, market activity is 
suppressed leading to reduced trading volumes. 

Potential impact

 > Reduction in broking activity 
 > Reduced earnings 
and profitability 

 > Increases in regulatory 
capital requirements

 > Reduction in broking activity
 > Pressure on brokerage rates
 > Reduced earnings 
and profitability

Failure to respond 
to client 
requirements

The risk that the Group fails to respond to rapidly 
changing customer requirements, including the demand 
for enhanced electronic broking solutions for certain 
asset classes.

 > Loss of market share
 > Reduced earnings and 

profitability

Change in risk exposure 
since 2019

No change

Increased 

No change

Impact of Brexit

The risk that Brexit leads to a deterioration in the 
commercial environment and consequential reduction 
in trading volumes.

 > Reduction in broking activity
 > Loss of market share 
 > Reduced earnings 
and profitability

Increased

Impact of 
Covid-19

The risk that the operating model implemented by the 
Group to comply with the loss of EU passporting rights 
results in a fragmentation of liquidity between UK and 
EU liquidity pools. 
The risk that the Group experiences a significant 
deterioration in business performance due to the 
impact of Covid-19 on the broader global economy.

The Group is also aware of the potentially elevated 
operational risk arising from remote working 
arrangements, including: (a) Enhanced risk of 
operational failure, which may be exacerbated by 
heightened levels of market volatility; and (b) Increased 
conduct risk arising from remote supervision. 

Annual Report and Accounts 2020
46

 > Reduction in broking activity
 > Loss of market share 
 > Reduced earnings 
and profitability

Increased

 > Consideration of potential Covid-19 impact in business 

 > Revenues by region

planning and strategy process 

 > Adoption of remote working protocols 

 > Trade volumes

 > Risk events

 > People, conduct 

and compliance

Mitigation

Key risk indicator

Related principal strategic objectives

 > Monitoring of regulatory developments 

 > Involvement in consultation and rule 

 > Setting processes

 > Status of regulatory 

change initiatives

 > Defined business strategy that seeks to maintain client, 

geographical and product diversification

 > Proactive engagement with clients through customer 

relationship management process

 > Clearly defined business development strategy which 

continues to enhance the Group’s service offering

 > Incorporation of new EU subsidiary to hold  

EU-based business

 > Changes to operating model to maintain UK-EU liquidity 

and regulatory compliance 

 > Proactive engagement with European regulators 

and clients

 > Operating profit

 > Revenues by region

 > Trade volumes

 > Revenue forecast

 > Stress testing scenario outcomes

 > Operating profit

 > Trade volumes

 > Revenues by region

 > New business initiatives

 > Client satisfaction surveys

 > Brexit revenue-at-risk

 > Brexit plan tracking

 > Electronification

 > Liquidity aggregation

 > Diversification

 > People, conduct 

and compliance

 > Electronification

 > Liquidity aggregation

 > Diversification

 > Electronification

 > Liquidity aggregation

 > Diversification

 > Liquidity aggregation

 > People, conduct 

and compliance

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

The Group also undertakes stress testing and scenario analyses to 
enhance its understanding of its risk profile. This includes the 
conducting of reverse stress tests to identify those risks which could 
render the Group’s business model unviable in an extreme scenario. 

In addition to the formal reviews noted above, the Group’s assesses 
its risk profile on an ongoing basis and will update its Risk Register 
and risk ratings outside of the formal assessment cycle, where 
required to reflect any material changes. This includes any changes 
to risk profile identified through the Group’s ongoing risk 
monitoring and reporting processes, as well as any new risks 
identified through the Group’s change management framework. 

The Group formally reviews its emerging risk profile as part of the 
risk identification and assessment process. An emerging risk, for 
these purposes, is defined as any new type of risk that may pose 
a material threat to the Group in the future and which the Group 
should monitor so that it is in a position to actively manage the risk 
if, and when, it becomes a more immediate threat to the Group. 

Emerging risks are recorded in the Group’s Emerging Risk Register, 
along with an assessment of its potential impact and an estimate 
of the timeframe within which it is likely to materialise

Mitigation

Key risk indicator

Related principal strategic objectives

 > Monitoring of regulatory developments 
 > Involvement in consultation and rule 
 > Setting processes

 > Status of regulatory 
change initiatives

Deterioration in 

the commercial 

environment

or geopolitical developments, market activity is 

suppressed leading to reduced trading volumes. 

The risk that due to adverse macro-economic conditions 

 > Reduction in broking activity

Increased 

 > Defined business strategy that seeks to maintain client, 

geographical and product diversification

 > Proactive engagement with clients through customer 

relationship management process

 > Clearly defined business development strategy which 
continues to enhance the Group’s service offering

 > Incorporation of new EU subsidiary to hold  

EU-based business

 > Changes to operating model to maintain UK-EU liquidity 

and regulatory compliance 

 > Proactive engagement with European regulators 

and clients

 > Operating profit
 > Revenues by region
 > Trade volumes
 > Revenue forecast
 > Stress testing scenario outcomes
 > Operating profit
 > Trade volumes
 > Revenues by region
 > New business initiatives
 > Client satisfaction surveys
 > Brexit revenue-at-risk
 > Brexit plan tracking

 > Electronification
 > Liquidity aggregation
 > Diversification
 > People, conduct 
and compliance
 > Electronification
 > Liquidity aggregation
 > Diversification

 > Electronification
 > Liquidity aggregation
 > Diversification

 > Liquidity aggregation
 > People, conduct 
and compliance

Impact of 

Covid-19

 > Reduction in broking activity

Increased

 > Consideration of potential Covid-19 impact in business 

planning and strategy process 

 > Adoption of remote working protocols 

 > Revenues by region
 > Trade volumes
 > Risk events

 > People, conduct 
and compliance

Annual Report and Accounts 2020
47

Risk

Description

1. Strategic and Business Risk

Adverse change 

to regulatory 

framework

The Group is exposed to the risk of a fundamental 

change to the regulatory framework which has a 

material adverse impact on its business and 

economic model.

Potential impact

Change in risk exposure 

since 2019

 > Reduction in broking activity 

No change

 > Reduced earnings 

and profitability 

 > Increases in regulatory 

capital requirements

 > Pressure on brokerage rates

 > Reduced earnings 

and profitability

Failure to respond 

The risk that the Group fails to respond to rapidly 

 > Loss of market share

No change

to client 

requirements

changing customer requirements, including the demand 

 > Reduced earnings and 

for enhanced electronic broking solutions for certain 

profitability

asset classes.

Impact of Brexit

The risk that Brexit leads to a deterioration in the 

 > Reduction in broking activity

Increased

commercial environment and consequential reduction 

in trading volumes.

The risk that the operating model implemented by the 

Group to comply with the loss of EU passporting rights 

results in a fragmentation of liquidity between UK and 

EU liquidity pools. 

The risk that the Group experiences a significant 

deterioration in business performance due to the 

impact of Covid-19 on the broader global economy.

The Group is also aware of the potentially elevated 

operational risk arising from remote working 

arrangements, including: (a) Enhanced risk of 

operational failure, which may be exacerbated by 

heightened levels of market volatility; and (b) Increased 

conduct risk arising from remote supervision. 

 > Loss of market share 

 > Reduced earnings 

and profitability

 > Loss of market share 

 > Reduced earnings 

and profitability

 
 
 
 
 
 
 
Principal risks and uncertainties 
continued

Description

Risk
1. Strategic and Business Risk continued
Acquisition of 
Liquidnet

The Group is exposed to execution risk in relation to the 
Liquidnet transaction. This includes the risk that it fails 
to successfully integrate the acquired business into the 
wider TP ICAP group or that it fails to achieve the 
financial targets associated with the transaction.

Potential impact

Change in risk exposure 
since 2019

 > Failure to achieve future 

New risk

financial targets 

 > Damage to reputation

Mitigation

Key risk indicator

Related principal strategic objectives

 > Integration managed through a formal programme 

management structure, overseen by a sub-committee 

of the TP ICAP plc board. 

 > Action taken to secure key personnel 

 > Performance against 

programme milestones

 > Performance against 

financial targets

 > Electronification

 > Liquidity aggregation

 > Diversification

2. Operational Risk
Operational 
failure

The Group is exposed to operational risk in nearly every 
facet of its role as an interdealer broker, including from 
its dependence on:

 > Financial loss which could, 

No change

in extreme cases, impact the 
Group’s solvency and 
liquidity

 > the accurate execution of a large number of processes, 
including those required to execute, clear and settle 
trades; and

 > Damage to the Group’s 
reputation as a reliable 
market intermediary

 > Appropriate framework of systems and controls 

to minimise the risk of operational failure

 > Incident and crisis management process 

 > Business continuity plans and capability

 > Reverse stress test process to identify key risks 

that could undermine the Group’s viability

 > Risk events 

 > Execution failure

 > Settlement fails 

 > Margin calls

 > System outages

 > Electronification

 > People, conduct 

and compliance

Cyber-security 
and data 
protection

 > a complex IT infrastructure.
The risk that the Group fails to adequately protect itself 
against cyber-attack and/or to adequately secure the 
data it holds, resulting in loss of operability as well as 
potential loss of critical business or client data.

Unlicensed use of 
proprietary data

The risk that the Group fails to protect unauthorised 
dissemination of Group’s proprietary data leading to 
loss of potential revenue streams.

Breach of legal 
and regulatory 
requirements

The Group operates in a highly regulated environment 
and is subject to the laws and regulatory frameworks 
of numerous jurisdictions. 

3. Financial Risk
Counterparty 
credit risk

FX exposure

Liquidity risk

Failure to comply with applicable legal and regulatory 
requirements could result in enforcement action 
being taken. 

The Group is exposed to counterparty credit risk arising 
from outstanding brokerage receivables, unsettled 
trades and cash deposits.

There is a risk that the Group suffers loss as a result of a 
movement in FX rates whether through transaction risk 
or translation risk.

The Group is exposed to potential margin calls 
from clearing houses and correspondent clearers. 
The Group also faces liquidity risk through being 
required to fund matched principal trades which fail 
to settle on settlement date.

 > Loss of revenue
 > Remediation costs
 > Damage to reputation
 > Regulatory sanctions
 > Payment of damages/

compensation

No change

 > Ongoing monitoring and assessment of the cyber-

 > Cyber-security events/losses

 > Vulnerability monitoring

 > Electronification

threat landscape 

 > Appropriate framework of systems and controls to prevent, 

 > Data loss events

identify and contain cyber threats 

 > Failure to achieve future 

No change

 > Ongoing audit of licences

 > Completion of data audit plan

 > Diversification

revenue growth targets due 
to non-contractual use of our 
market information 
 > Damage to reputation
 > Regulatory and legal 

enforcement action including 
censure, fines or loss of 
operating licence

 > Severe damage to reputation

 > Appropriate legal remedies incorporated within 

 > Data audit findings

licence agreements

No change

 > Compliance function to oversee compliance with 

regulatory obligations

 > Compliance monitoring and surveillance activity

 > Compliance training programme to ensure that staff 

are aware of regulatory requirements

 > Maintenance of compliance culture which fosters 

high standards of employee conduct

 > Internal Compliance 

policy breaches

 > Regulatory breaches

 > Employee conduct metrics

 > People, conduct 

and compliance

 > Financial loss which could, 

No change

in extreme cases, impact the 
Group’s solvency and 
liquidity

 > Financial loss which could, in 
extreme cases, impact the 
Group’s solvency and 
liquidity

 > Reduction in the Group’s 
liquidity resources which 
could, in extreme cases, 
impact the Group’s liquidity

No change 

 > Ongoing monitoring of Group’s FX positions

 > FX translation exposure

 > FX transaction exposure

 > Diversification

No change

 > Margin call and trade funding profile monitored against 

 > Margin call profile

 > Diversification

defined limits

 > Settlement fail – funding 

 > Group maintains liquidity resources in each operating 

requirements

centre to provide immediate access to funds 

 > Unplanned intra-Group 

 > Committed £270m and JPY 10bn (c.£71m) revolving credit 

funding calls

facilities (‘RCF’)

 > RCF draw-down

 > Counterparty exposures managed against thresholds 

calibrated to reflect counterparty creditworthiness

 > Exposure monitoring and reporting by independent 

 > Portfolio exposure

 > Client exposure

 > Aged debt

credit risk function

 > Diversification

Annual Report and Accounts 2020
48

Risk

Description

1. Strategic and Business Risk continued

Acquisition of 

Liquidnet

The Group is exposed to execution risk in relation to the 

 > Failure to achieve future 

New risk

Liquidnet transaction. This includes the risk that it fails 

financial targets 

to successfully integrate the acquired business into the 

 > Damage to reputation

wider TP ICAP group or that it fails to achieve the 

financial targets associated with the transaction.

2. Operational Risk

Operational 

failure

The Group is exposed to operational risk in nearly every 

 > Financial loss which could, 

No change

facet of its role as an interdealer broker, including from 

in extreme cases, impact the 

its dependence on:

 > the accurate execution of a large number of processes, 

 > Damage to the Group’s 

including those required to execute, clear and settle 

trades; and

 > a complex IT infrastructure.

Group’s solvency and 

liquidity

reputation as a reliable 

market intermediary

Potential impact

Change in risk exposure 

since 2019

Mitigation

Key risk indicator

Related principal strategic objectives

 > Integration managed through a formal programme 

management structure, overseen by a sub-committee 
of the TP ICAP plc board. 

 > Action taken to secure key personnel 

 > Performance against 

programme milestones

 > Performance against 

financial targets

 > Electronification
 > Liquidity aggregation
 > Diversification

 > Appropriate framework of systems and controls 

to minimise the risk of operational failure
 > Incident and crisis management process 
 > Business continuity plans and capability
 > Reverse stress test process to identify key risks 
that could undermine the Group’s viability

 > Risk events 
 > Execution failure
 > Settlement fails 
 > Margin calls
 > System outages

 > Electronification
 > People, conduct 
and compliance

Cyber-security 

The risk that the Group fails to adequately protect itself 

 > Loss of revenue

No change

 > Ongoing monitoring and assessment of the cyber-

and data 

protection

against cyber-attack and/or to adequately secure the 

 > Remediation costs

data it holds, resulting in loss of operability as well as 

potential loss of critical business or client data.

threat landscape 

 > Appropriate framework of systems and controls to prevent, 

identify and contain cyber threats 

 > Cyber-security events/losses
 > Vulnerability monitoring
 > Data loss events

 > Electronification

Unlicensed use of 

proprietary data

The risk that the Group fails to protect unauthorised 

dissemination of Group’s proprietary data leading to 

loss of potential revenue streams.

 > Ongoing audit of licences
 > Appropriate legal remedies incorporated within 

 > Completion of data audit plan
 > Data audit findings

 > Diversification

licence agreements

 > Damage to reputation

 > Regulatory sanctions

 > Payment of damages/

compensation

 > Failure to achieve future 

No change

revenue growth targets due 

to non-contractual use of our 

market information 

 > Damage to reputation

Breach of legal 

and regulatory 

requirements

of numerous jurisdictions. 

The Group operates in a highly regulated environment 

 > Regulatory and legal 

No change

and is subject to the laws and regulatory frameworks 

enforcement action including 

censure, fines or loss of 

operating licence

Failure to comply with applicable legal and regulatory 

 > Severe damage to reputation

requirements could result in enforcement action 

being taken. 

 > Compliance function to oversee compliance with 

regulatory obligations

 > Compliance monitoring and surveillance activity
 > Compliance training programme to ensure that staff 

are aware of regulatory requirements

 > Maintenance of compliance culture which fosters 

high standards of employee conduct

 > Internal Compliance 

policy breaches

 > Regulatory breaches
 > Employee conduct metrics

 > People, conduct 
and compliance

3. Financial Risk

Counterparty 

credit risk

The Group is exposed to counterparty credit risk arising 

 > Financial loss which could, 

No change

from outstanding brokerage receivables, unsettled 

trades and cash deposits.

in extreme cases, impact the 

Group’s solvency and 

liquidity

 > Counterparty exposures managed against thresholds 
calibrated to reflect counterparty creditworthiness
 > Exposure monitoring and reporting by independent 

 > Portfolio exposure
 > Client exposure
 > Aged debt

credit risk function

 > Diversification

FX exposure

There is a risk that the Group suffers loss as a result of a 

 > Financial loss which could, in 

No change 

 > Ongoing monitoring of Group’s FX positions

 > FX translation exposure
 > FX transaction exposure

 > Diversification

 > Reduction in the Group’s 

No change

 > Margin call and trade funding profile monitored against 

defined limits

 > Margin call profile
 > Settlement fail – funding 

 > Diversification

 > Group maintains liquidity resources in each operating 

requirements

centre to provide immediate access to funds 

 > Unplanned intra-Group 

 > Committed £270m and JPY 10bn (c.£71m) revolving credit 

facilities (‘RCF’)

funding calls
 > RCF draw-down

movement in FX rates whether through transaction risk 

extreme cases, impact the 

or translation risk.

Liquidity risk

The Group is exposed to potential margin calls 

from clearing houses and correspondent clearers. 

The Group also faces liquidity risk through being 

required to fund matched principal trades which fail 

impact the Group’s liquidity

to settle on settlement date.

Group’s solvency and 

liquidity

liquidity resources which 

could, in extreme cases, 

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Annual Report and Accounts 2020
49

 
 
 
 
 
 
 
Environmental, Social and Governance

As an international financial services firm, we are aware of the 
impacts of climate change and social inequality, and the potential 
risks they pose to our business and stakeholders. We take seriously 
our responsibility to managing these risks, not only because it is the 
right thing to do but also because it protects the sustainability of 
our business. 

Our journey
Increasingly, clients, investors, ratings agencies, regulators, NGOs 
and other core stakeholders including current and prospective 
employees incorporate Environmental, Social and Governance 
(ESG) performance into their decision-making process. 
Consequently, TP ICAP believes that performing well in ESG 
represents a licence to do business and is a critical factor in 
achieving sustainable growth.

TP ICAP has long recognised the importance of being a responsible 
business; for example, ICAP Charity Day dates back to 1993, since 
when it has raised more than £150 million for charities globally. 
However, given the rapid development and increasing scope of the 
ESG agenda, in 2019 we saw that we needed to strengthen our 
sustainability credentials and communicate how we were doing so 
more effectively. 

As a first step, we committed to create a new framework to improve 
how we measure, manage and report on the ESG issues that are 
most relevant to our Group. In 2020, we delivered against that 
commitment, having undertaken a comprehensive materiality 
assessment leading us to establishing an ESG Reporting Framework 
comprising 15 data disclosure areas. Each disclosure has an 
associated set of metrics according to internationally 
recognised standards. 

To ensure ownership and accountability, individual disclosure areas 
have been assigned to a relevant senior manager, and governance 
has been strengthened up to and including Board level. Having 
identified these 15 ESG disclosure areas, we have also begun to 
report against them this year. 

While important, we recognise that robust reporting is but one step 
forward in our ESG journey. We have more to do, the next step is to 
develop an overarching ESG strategy that is aligned to our purpose. 
We commit to completing this strategy by the end of 2021, with 
execution to commence in 2022.

Preparing for TCFD
We welcome the UK Government’s intention to implement 
mandatory reporting aligned to the recommendations of the 
Taskforce for Climate-Related Disclosures (TCFD). In 2021, we 
will update our risk management process to strengthen our 
consideration of the potential business implications and impacts of 
climate change. In addition, we will create a roadmap to align with 
the four strategic areas and 11 recommendations of the TCFD. 
Alignment to TCFD will be an ongoing process that will evolve 
over time and we will begin to report progress in our 2021 
Annual Report.

Establishing our ESG reporting framework
To identify the ESG data disclosure areas most relevant to TP ICAP, 
we undertook a materiality assessment. The assessment was 
informed by internationally recognised reporting frameworks 
including the Sustainability Accounting Standards Board (SASB); 
the Global Reporting Initiative (GRI); Carbon Disclosure Project 
(CDP), and the Principles for Responsible Investing (PRI).

Adding further rigour, we also analysed information requests from 
clients, prospects and rating agencies, sought input from our 
corporate brokers, and sourced industry best practice. 

The outcome of this process was 15 ESG data disclosure areas, 
each with associated metrics and international standards, and 
accountable executive ownership. These disclosure areas form 
the core of how we now report our performance, see our website 
for information.

Annual Report and Accounts 2020
50

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

TP ICAP Group ESG Reporting Framework

The 15 data disclosure areas on which we report are 
categorised into three sections: Environmental, Social 
and Governance and are shown below. For more detail 
on the disclosure areas, please see our website.

By focusing on these areas we can ensure we are 
investing resource in the areas that matter most which 
will help us to deliver positive impact across our 
operations and our communities. 

Environmental

>   Carbon emissions 
>   Energy use

Social

Governance

>   Employee Diversity & Inclusion 
>   Charitable donations
>   Staff turnover rates
>   Share of temporary staff
>   Employee training hours

>  Incorporation of ESG factors in brokerage activities
>  Business Ethics – Professional integrity
> Systemic risk management
>  Promoting transparent and efficient capital markets
> Managing conflicts of interest
>  Managing business continuity and technology risks
> Political contributions
> ESG fines

Enhanced ESG governance
Having established our core ESG Reporting Framework, we also 
strengthened our governance of managing ESG performance so 
that it sits at the highest level of the business. Specifically, a new 
ESG subcommittee has been established reporting into the Group 
Risk, Culture and Conduct Committee (‘GRCCC’). The ESG 
subcommittee serves to:

 > ensure that the Group reports in line with the ESG Framework;
 > determine ESG strategy;
 > manage execution of strategy;
 > develop and implement ESG communication strategy.

The ESG subcommittee provides quarterly updates on progress to 
the GRCCC. In addition, ESG has been established as a standing 
agenda item at our plc Board meetings. Our Group Chief Executive 
Officer is the Board member responsible for ESG across the Group.

We have also welcomed Tracy Clarke, who was only recently 
appointed to the Board, as ESG Engagement Director. Tracy, a 
Non-executive Director, will work closely with the Company’s senior 
management to ensure, amongst other things, that the Board fulfils 
its role in oversight of ESG strategy and performance and continues 
to have the right conversations from an ESG perspective.

Annual Report and Accounts 2020
51

 
 
 
 
 
 
 
Environmental, Social and Governance 
continued

ESG in action: Reporting and commentary

Environmental

Social

TP ICAP recognises its responsibility to help protect the 
environment and address the global climate crisis. We seek to 
meet this responsibility in two ways: minimise the negative 
environmental impact of our operations and support our clients 
in their transition to a net zero economy. Commentary on how 
we support our clients can be found in the Governance section.

Reducing our carbon footprint
Our reporting is aligned with the Streamlined Energy and Carbon 
Reporting regulations. We have outlined our greenhouse gas 
emissions data, total global energy use and energy efficiency 
action being taken by the Company, plus the methodology used 
to calculate these disclosure requirements. Our full carbon emissions 
data can be found in the Director’s report on page 111.

In 2020, our total emissions (including Scope 3) reduced by 10%, 
which results in a reduction of emissions per employee to 2.0tCO2e 
compared to 2019’s figure of 2.3tCO2e per employee. The reduction 
in emissions is largely due to a significant reduction in business 
travel as a result of the global COVID-19 pandemic. Overall, Scope 1 
and 2 emissions have increased by 23%, which is largely due to the 
addition of some sites and also improved quality of data in 2020. 
Compared to the previous year, TP ICAP has been able to greatly 
improve the data relating to the London Broadgate site and Belfast 
City Quays site. 

In 2019, we started reporting some of our Scope 3 emissions 
(business travel only) to further demonstrate our commitment to 
improving reporting methodology and scope, which in turn allows 
greater visibility into our overall emissions. In 2020, we included 
additional Scope 3 data for hotel stays.

Our Board has responsibility for Environmental issues which are 
included in the Matters Reserved for the Board. 

Much of our carbon footprint comes from the energy consumption 
of our leased offices. Consequently, this is where we focus our efforts 
to reduce our impact. Due to the COVID-19 pandemic we were 
unable to make significant improvements to energy efficiency 
within the Financial Year. However, we have made efforts to 
remove redundant technology equipment within our data suites 
to help reduce our overall energy consumption.

A building for a brighter future
In early 2021, we will consolidate our current London City offices 
into a single location at 135 Bishopsgate, reducing our occupational 
footprint in the City of London by 12%.

The BREEAM-certified building has been extensively remodelled 
and refurbished to reduce carbon emissions including the addition 
of extensive cycling facilities to encourage cycling to work; PIR 
lights that use passive infrared sensors to detect presence, 
movement and absence; and metering for electric and water usage, 
with an overall Building Management System to optimise control. 
Additional eco-friendly measures include water efficient fittings; 
crockery in kitchens; zero single-use plastics; and improved recycling 
facilities on all floors.

We have made significant progress to further our contribution to a 
more sustainable society by focusing on three core areas in 2020:

 > Embed existing and launch new diversity and inclusion (‘D&I’) 
initiatives to augment our approach to investing in our people
and processes;

 > Promote economic participation through our social

mobility strategy; 

 > Continue our charitable donation efforts during a year of

unprecedented upheaval and hardship for so many.

Diversity & Inclusion in action
In 2020, D&I issues rose further in prominence on the social and 
political agenda. At TP ICAP, we continue our commitment to 
building an inclusive place to work, where everyone – regardless 
of their educational background, ethnicity, gender, ability, age or 
sexual orientation – has an equal opportunity to succeed within 
our Company.

The focal point of our efforts to enhance gender, ethnic and 
socio-economic diversity and inclusion across the business is 
Connect our global diversity and inclusion forum. Of our people, 
by our people, for our people, Connect seeks to promote the issues 
and actions necessary to champion a strong, vibrant, meritocratic 
culture. Since its launch we have evolved Connect to be the 
overarching steering and advisory panel to drive a strong diverse 
and inclusive culture.

In 2020, we enhanced Connect’s influence by undertaking a D&I 
survey of all employees globally. As a direct result, we have 
established a new structure to respond to the issues raised through 
Connect whereby Regional CEOs and their locally appointed D&I 
Champions work together to take the learnings from the survey to 
inform local D&I strategy, thereby ensuring it is tailored to meet 
each region’s specific needs.

For example, as part of our D&I survey response action plans, 
we delivered a successful programme of Inclusive Leadership 
Workshops for all UK leaders and managers. These thought-
provoking and practical sessions were designed to support and 
enhance the way our leaders and teams work together to add 
value to the business.

As the world mobilises to tackle 
climate change, TP ICAP continues 
to adapt our brokerage activities 
to support our clients with their 
transition to a net zero economy.

Annual Report and Accounts 2020
52

Furthermore, we revised our Global D&I policy to create a 
consistent and unified approach to managing issues across the 
Group which we will communicate in March 2021. 2020 also saw the 
Group’s Performance Objectives process require all managers to 
meet a D&I objective that is linked to their performance review and, 
consequently, reward.

We continue to report our gender diversity results as part of the HM 
Treasury Women in Finance Charter. As at September 2020, women 
made up over 31% of our senior leadership team. This signals that 
we achieved our target of 25% by 2025, ahead of our target figure 
and timeline. We have shown improvement in gender diversity since 
our first Women in Finance submission in September 2018, when we 
reported 16% of senior women represented in the business. The 
targets we set then were: 20% of women represented at Group 
Executive Committee and direct reports by year 2022, and 25% 
by 2025. 

Our progress is a result of senior hires, effective succession planning, 
and a restructure of our overall governance model. We will continue 
to improve our performance through measures including 
strengthening family-friendly policies; ensuring female 
representation on every short list when hiring; promoting our 
women’s networks; and rolling out unconscious bias training.

We also submitted an update to the Hampton-Alexander Review, 
disclosing the number of men (16) and women (5) on our Executive 
Team and separately our numbers of men (110) and women (19) 
who are direct reports to the Executive Team (excluding admin and 
support). While we are proud of the work we have done so far to 
improve diversity, we know that there is still a lot more progress to 
be made. Like many financial services businesses, we know that 
gender diversity remains an issue and we will continue to work to 
improve the balance and to promote opportunities for all. 

Gender pay
In line with government guidelines, TP ICAP did not release a 
Gender Pay Gap report in 2020. However, we will report our figures 
in May 2021, despite the new extension from the Government 
Equalities Office until October 2021. For more information see 
our website.

Other D&I initiatives implemented in 2020 include updating our 
online assessments to ensure they are fair and accessible for 
disabled people, and undertaking a wholesale review of the 
wording of all job adverts and descriptions to ensure there are no 
biases and that our language is as inclusive as possible. We are 
also placing adverts in new publications to reach a wider audience.

As a signatory to the Armed Forces Covenant, we were proud to 
receive an upgrade to Silver Award for our commitment as an 
armed forces-friendly employer. We thank serving personnel and 
our reservists, veterans and military families for their valuable 
contribution to our country and to our business.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Supporting and developing our people
In 2020, we introduced a Global Mentoring Programme open to all 
employees across all locations. To date, more than 70 people have 
signed up to be mentors, and 90 as mentees. The programme will 
form part of employee development both for mentors and mentees, 
enabling a forum for individuals to discuss issues important to them 
as they develop through the business.

Turning to employee well-being, we rolled out a variety of sessions 
globally including ‘Managing Stress and Resilience’, ‘Good 
Nutrition’, ‘Good Sleep’ and ‘Mental Health Awareness for Line 
Managers’. We also continued to work in partnership with our 
medical insurance provider to provide a comprehensive insurance 
for staff. In addition to our medical insurance scheme, we provided 
support services for all employees whether they are members of the 
medical insurance or not. Services such as a Well-being App, Digital 
GP Services (employee family members can take advantage of this 
service too), as well as Mental Health support, Line Management 
training, and support using the Mental Health Plus Pathway.

Human rights and modern slavery
We continue to support the UN Guiding Principles for Human Rights 
and recognise human trafficking and forced labour exists in both 
developed and developing economies and across sectors. 
Therefore, we are committed to taking steps to combat the risk 
of any form of modern slavery from occurring in our business or 
supply chain.

Despite the COVID-19 pandemic, TP ICAP has remained vigilant 
in continuing our activity to identify and address risks of modern 
slavery in our operations and supply chains. However, the impact of 
the pandemic caused increased pressures on our procurement team 
as it strived to ensure continuity of our supply chains to keep the 
business functioning smoothly during this pressing time. Therefore, 
aligned with government guidelines, TP ICAP delayed the 
publication of its modern slavery report by six months. The 2020 
statement can be found on our website.

During 2020, we have revamped our Procurement governance 
controls, strengthening the initial assessment and ongoing 
monitoring across all areas of supply chain risk, including modern 
slavery. These updates include:

 > Introduction of a tiering process to identify high-risk suppliers or 

supply chains, including modern slavery risks;

 > Enhanced governance surrounding modern slavery checks and 
controls during supplier onboarding based on the risk tiering;
 > Inclusion of a check for suitable contractual provisions covering 
modern slavery, where appropriate, during contract approval 
governance;

 > Ongoing monitoring, using an intelligent risk monitoring 

application, to confirm there has been no law enforcement 
actions taken against a supplier in relation to known instances 
of modern slavery.

Our Group Risk, Culture and Conduct Committee oversees the 
delivery of our strategy to eliminate modern slavery in our business 
and supply chains. As part of this, we will create a KPI framework 
to review performance and hold ourselves to account on tackling 
modern slavery.

Annual Report and Accounts 2020
53

 
 
 
 
 
 
 
Environmental, Social and Governance 
continued

Championing social mobility
We introduced our strategy to champion social mobility in 2018. 
Our focus throughout has been to support initiatives that boost 
social mobility through education and skills. Our work in this area is 
more important than ever given the impact of COVID-19.

We are committed to supporting creative initiatives that inspire 
new generations and give them the confidence to succeed. In 2020, 
our face-to-face volunteering efforts have been curtailed due to 
COVID-19 social distancing restrictions; however, we have still been 
able to make an impact:

 > We once again took part in the Lord Mayor’s Appeal She Can Be, 
a programme to inspire more young women to consider a career 
in the City.

 > We also participated in the Lord Mayor’s Appeal City Giving 
Day, highlighting our support for local communities within the 
City of London. This year, employees cycled in the virtual Tour De 
City to raise awareness of the great causes that we support 
through our charitable giving.

 > In response to at-home learning, TP ICAP employees volunteered 
to help teachers manage classroom video calls; helped teachers 
deliver instructions to non-English speaking parents; and assisted 
as an online editor in New York, supporting Reach the World.
 > Stem 101 is a programme which helps public schools in the US 

that are struggling. Our colleagues recorded ‘selfie subject matter 
lessons’ delivered online. Topics ranged from a simple lesson on 
how to manage money (in English and Spanish) to lessons on 
spreadsheets and presentations. Students completed the project 
ranging from two to five hours and, after completion, each 
student received a certificate to print and email to their teacher.

Everybody Counts numeracy campaign
We are committed to helping more people be more comfortable 
with numbers. Now in its third year, our numeracy campaign, 
Everybody Counts, continues to make progress towards realising our 
ambition to engage one million people across our key markets to 
improve their basic numeracy skills.

In the UK we continue our partnership with the charity National 
Numeracy to achieve our ambition of empowering 250,000 people 
to improve their confidence with numbers by the end of 2021. As of 
the end of 2020, our partnership with National Numeracy has 
already engaged a rolling total of 205,065 people.

 > 205,065 people engaged across the UK and on track to meet our 

goal in 2021.

 > We marked National Numeracy day on 13 May 2020 by 

launching research into young women’s confidence with numbers 
and the impact this has on their ambition to enter the financial 
services sector.

 > In November 2020, TP ICAP was proud to be the Founding 

Partner, alongside the charity National Numeracy, in delivering 
the UK’s first ever Number Confidence Week to support our 
strategic objective to engage people to improve their numeracy 
skills and build confidence with numbers. See results in the 
case study.

Annual Report and Accounts 2020
54

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Case study: 

Building confidence  
in numbers 
At TP ICAP we’re numbers people and we know 
that numeracy is crucial for the success of our 
industry. According to our recent research, some 
78% of young British women, aged 18-21, said they 
would not consider a career in financial services, 
with 43% citing a lack of confidence using numbers 
as a reason. 

We’re committed to transforming the talent pipeline for our 
Company and the financial services sector as a whole, to ensure 
equal access to careers and progression. That’s why, in November 
2020, we were the Founding Partner of the UK’s first Number 
Confidence Week, held with our charity partner, 
National Numeracy. 

Number Confidence Week content was tailored specifically for 
those who have low number confidence, inspiring and encouraging 
them to act and start to feel better about understanding and 
working with numbers. 

What we achieved:
 > Over 22,000 people took action during the week towards 

building their confidence with numbers. Our pre-event target had 
been 10,000 people;

 > Over 50 young women watched and participated in our virtual 
expert panel event where they heard from women in financial 
services and financial journalism on how they improved their own 
number confidence;

 > TP ICAP female role models took part in a social media video 
series sharing their experiences of number confidence which 
gained over 143,000 views; 

 > We released a report providing insight into why low number 

confidence affects women’s career prospects and 
recommendations for the financial services sector to 
demonstrate progress. 

Annual Report and Accounts 2020
Annual Report and Accounts 2020
55
55

 
 
 
 
 
 
 
Environmental, Social and Governance 
continued

Charitable giving 
The health and economic crisis caused by COVID-19 has impacted 
everyone across the globe. At TP ICAP, we are committed to 
responding by helping charities to help the most vulnerable in 
society. Throughout the pandemic we have enabled our employees 
to support charitable causes through virtual volunteering and 
maintained donations to our chosen charities through our matched-
funding programme. We directed our entire 2020 Disaster Relief 
Fund to pandemic response charitable activities.

Our Charitable Giving policy enables our employees to assist 
charitable causes close to their hearts, either through matched 
funding or volunteering hours. Additionally, ICAP Charity Day 
raises money for charities across the globe with 100% of the 
revenues and commissions generated by ICAP set to be donated to 
a variety of worthy causes. This year, in terms of charity selection, 
we prioritised charities aligned with our strategic theme of social 
mobility, as well as those who aid the recovery process as economies 
struggle to recover from the long-term and social effects of the 
pandemic, such as mental ill-health, homelessness, addiction and 
loneliness among the elderly.

To align with government social distancing measures, we hosted 
a virtual ICAP Charity Day 2020 on 10 December, and enjoyed 
excellent support from our clients, colleagues, the charities 
themselves and their patrons and celebrity ambassadors, via social 
and digital media, right around the world. Together, in 2020, we 
proudly raised £3.6m, bringing the total funds raised since ICAP 
Charity first began in 1993, to over £150m and supporting some 
2,600 amazing charitable causes globally.

Throughout the pandemic we have 
enabled our employees to support 
charitable causes through virtual 
volunteering and maintained donations 
to our chosen charities.

Image top: Olivia Colman participated in our virtual ICAP Charity Day 2020 in 
London, as ambassador of Refuge, supporting women and children experiencing 
domestic violence.

Read more on Charitable Giving
tpicap.com

Image middle: A donation from ICAP Charity Day in the UK funded a Palliative 
and Life Limited Service Nurse, for Northern Ireland Children’s Hospice.

Image bottom: A donation from ICAP Charity Day in the UK went to NHS Charities 
Together and their programmes supporting the mental health and well-being of 
NHS staff.

Annual Report and Accounts 2020
56

Some of the charities we support around the world

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Annual Report and Accounts 2020
57

 
 
 
 
 
 
 
Environmental, Social and Governance 
continued

Governance

Incorporating ESG factors in Brokerage activities
As the world mobilises to tackle climate change, TP ICAP continues 
to adapt our brokerage activities to support our clients with their 
transition to a net zero economy.

At the forefront of this effort is our Energy & Commodities division, 
where c.40% of revenues now come from positive, neutral or 
transitional products, including renewable power sources and 
alternative fuels such as biodiesel, carbon credits, and weather, 
demonstrating that ESG factors are already well embedded in 
our activities.

Remaining relevant to our clients as the transition gathers pace and 
industry moves away from high carbon fuels to lower carbon fuels 
such as gas will be of increasing importance over the next five 
years. Liquefied Natural Gas (‘LNG’) in particular is set to play a 
pivotal role with investment in recent years in LNG infrastructure 
transforming the gas markets globally from being essentially 
domestically traded markets to be internationally traded, not unlike 
oil. With our global footprint, we are well positioned to support 
clients through this change.

Additionally, in September 2020 the Tullett Prebon Energy & 
Commodities Biofuels Desk became the first broker to transact a 
Used Cooking Oil Methyl Ester (‘UCOME’) paper contract between 
two counterparties. The strong potential of UCOME as a tradeable 
asset has gained momentum over the past few years to meet the 
demand for waste-based products as a source of clean energy. 
With the EU Renewable Energy Directive encouraging the use of 
advanced biofuels and waste-based biodiesel, and clear CO2 
savings from using this type of fuel, manufacturers and traders are 
given incentive to use this waste-derived fuel. 

This landmark trade positions Tullett Prebon Biofuels Desk as a 
leader in a highly promising marketplace of waste-based products. 
We will continue to support clients with precise market data, 
analytics and price discovery that ultimately enables them to 
manage their biodiesel price risk and exposure along the forward 
curve for both physical and derivative products.

Reflecting TP ICAP’s brokerage performance, ICAP was voted for 
and ranked number one in the Environmental Finance 2020 Market 
Rankings in the following categories:

Weather risk management – North America

Best broker
Best broker
Best broker

Weather risk management – Europe

Catastrophe risk management – Global broker

Annual Report and Accounts 2020
58

Whistleblowing, anti-money laundering and bribery and 
corruption 
TP ICAP recognises its responsibility to fully meet its legal and 
regulatory requirements to protect the integrity and stability of the 
financial markets and makes a commitment to: 

 > not be used by criminals to launder the proceeds of crime, or by 

sanctioned individuals and entities;

 > help combat terrorist financing; 
 > comply with economic and trade sanctions issued by relevant 
governments and organisations in every jurisdiction in which 
we operate;

 > ensure that neither the firm, nor any other person providing 
services ‘for and on behalf of’ it, facilitates tax evasion; 
 > prohibit the acceptance, or offering of a bribe in any form; 
 > prohibit the solicitation of business by the offering of any form 

of bribe; and

 > prohibit the offering of employment, with the intention of 

receiving an improper business advantage; and 

 > prohibit the making of facilitation payments.

TP ICAP strives to maintain the highest standards of honesty, 
openness and accountability and recognises that all those who 
work with or within the Group have an important role to play in 
achieving this goal. 

Accordingly, the Group has a global whistleblowing policy which 
encourages employees and third parties to report suspicion of 
wrongdoing in relation to TP ICAP activities including: criminal 
activity, failure to comply with legal or regulatory requirements, 
miscarriages of justice, danger to health and safety, damage to 
the environment, bribery, financial fraud, negligence, breach of 
TP ICAP’s policies and unauthorised disclosure of confidential 
information.

Tax and other social payments
The Group has published a Group Tax Strategy, which is available 
on TP ICAP’s website. The Group Tax Strategy explains that the 
Group is committed to complying with tax laws in a responsible 
manner and to having open and constructive relationships with tax 
authorities wherever we operate, and that the Group’s tax risk 
appetite is low.

The Group made payments to tax authorities for 2020 of £525m 
(2019: £507m), comprising corporation tax, premises taxes, 
employer’s social security payments, income taxes and social 
security paid on behalf of employees in the UK and the US (the 
main jurisdictions in which it operates), and VAT/sales taxes borne 
and collected. In addition, the Group makes further tax payments 
to the tax authorities in other tax jurisdictions in which it operates.

HM Treasury has adopted the requirements set out under CRD IV 
and issued the Capital Requirements Country-by-Country 
Reporting Regulations 2013. The legislation requires the 
publication of additional information, including certain tax 
payments, in respect of the year ended 31 December 2020, by 
31 December 2021. This information will be available by this date 
either in the statutory accounts of the relevant companies or on 
TP ICAP’s website www.tpicap.com.

Building a strong conduct culture
TP ICAP is committed to building a strong conduct culture. 
Initiatives implemented in 2020 include:

 > New joiner induction: Roll out of a new half day induction 
session that includes Culture and Conduct as part of the 
programme. Presented by the Regional CEO, Heads of Support 
Functions and SMDs from the Business Divisions, the induction 
covers a range of topics including: TP ICAP firm overview, Values 
& Conduct, Our Cultural Framework, TP ICAP management, 
global footprint, liquidity, global business lines, diverse trading 
technology and the 2020 Strategy.

 > Broker Performance & Conduct Bonus Process: The process has 
been enhanced to align the questions to our Honesty Integrity 
Respect Excellence values and ensure documented evidence of 
performance and conduct has taken place. All brokers are 
formally assessed in relation to performance and conduct prior 
to any bonus payment being made.

 > Conduct Review Forum: Established a Conduct Review Forum to:

 > Approve recommendations as to whether a misconduct matter 

amounts to breach of the FCA Conduct Rules;

 > In the context of disciplinary proceedings, approve 

recommendations as to whether a person remains fit and 
proper to continue in specific SMF or Certified Function;

 > Act as an escalation point for qualified regulatory reference 

received by the relevant TP ICAP SMCR Entity: 
 > Make recommendations as to whether recruitment 

should proceed;

 > Make decisions for a compensation adjustment based on the 

outcome of any disciplinary sanctions;

 > Provide MI to the Regional Risk, Culture and Conduct Committee.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Managing business continuity and technology risks
TP ICAP’s Business Continuity Management (‘BCM’) practices are 
governed globally, with the objective to ensure the safety of staff, 
minimise the impact of a business disruption, provide effective crisis 
management, and to allow for the continuation and recovery of 
critical systems and services. BCM is embedded in TP ICAP’s culture 
and the Group is committed to maintaining processes and plans in 
order to enable critical functions to continue, following a disruptive 
event. A formal governance structure exists with documented 
responsibilities, including regional management and executive 
oversight via Risk Committees.

TP ICAP’s Crisis Management teams are organised on a global and 
regional level: Gold (Global, Strategic), Silver (Regional, Tactical), 
and Bronze (Office, Operational). Crisis Management is the initial 
response to a major disruption, designed to resolve any incident 
quickly without the need to relocate or reduce critical TP ICAP 
business operations. TP ICAP has regional Silver Teams with detailed 
plans to provide an effective and timely response to disruptive 
events of varying severity and type. TP ICAP has invested in an 
Emergency Notification System to facilitate timely, effective global 
alerts to TP ICAP employees during a disruptive event.

All events must be escalated in accordance with the Group’s Event 
Rating and Escalation Scale, as stated in the Group’s Enterprise Risk 
Management Framework.

TP ICAP operates a comprehensive Change Management process 
for all technology changes including regional and global Change 
Advisory Boards, which meet weekly and where all changes are 
reviewed for approval. Any failed changes are tracked with 
associated problem tickets as part of a failed change problem 
management process. IT incidents are tracked and managed based 
upon severity of incident against an application and IT Services 
tiering scale. A formal problem management process is operated 
to track actions arising from incidents, with thematic reviews for 
repeat incidents or common patterns.

Throughout 2020, TP ICAP experienced no IT or Business Continuity 
incidents that caused significant market disruption or had a 
material adverse effect on our business. Similarly, no data breaches 
were experienced during 2020 within the TP ICAP perimeter.

Systemic risk management 
Effective risk management is essential to the financial strength 
and resilience of the Group and for delivering its business strategy. 
The Risk Management section on page 44 explains how the Group 
manages its risk profile through its enterprise risk management 
framework (‘ERMF’). The Group recognises that in order to ensure 
the effective operation of the ERMF, it must implement an 
appropriate risk management culture that fosters the desired risk 
management values and behaviours, and that is aligned to 
TP ICAP’s values. This includes promoting an environment of 
openness that encourages the reporting and discussion of risk-
related matters and incidents. 

Annual Report and Accounts 2020
59

 
 
 
 
 
 
 
Environmental, Social and Governance 
continued

The Group seeks to achieve the implementation of its risk 
management culture through a range of actions. These include the 
setting of an appropriate ‘tone-from-the-top’, clear communication 
of risk management expectations and responsibilities, and through 
remuneration structures that effectively support the achievement of 
the desired risk management behaviours.

Managing conflicts of interest
Confidence in TP ICAP’s integrity to act on behalf of its customers is 
central to the relationship of trust we have with our customers. This 
means that when providing services, TP ICAP will always act in the 
customer’s best interests, putting customers’ interests ahead of 
its own.

A robust risk framework will also enable us to play our role in 
maintaining the integrity and professionalism of the markets where 
we operate and should also be a competitive differentiator with our 
clients who are increasingly looking beyond liquidity and pricing to 
broader ESG considerations when selecting their service providers. 

In addition, to help the Group manage and discharge its ESG 
responsibilities the Group has established an Environmental Social 
and Governance Sub-Committee, reporting into the Group Risk, 
Culture and Conduct Committee.

Promoting transparent and efficient capital markets
The Group has numerous trade and transaction reporting 
requirements that it has to meet, which are both regulatory and 
exchange driven. 

The majority of the Group’s reporting requirements are completed 
by integrated, end-to-end reporting systems across a wide range of 
regulatory regimes, for example MiFID II and TRACE. With having 
implemented these systems, the Group has effective systems and 
controls to alert us of any breaches to the timings of the publication 
of this data to allow us to remediate issues as soon as possible.

The Group recognises that accurate and timely reporting is 
essential to transparent and efficient markets; to that end the 
Group and has an ongoing programme of work to improve the 
stability of its reporting systems and infrastructure.

The Group has put in place the necessary policies and procedures to 
meet its obligations with regards to the identification, prevention 
and management of conflicts of interest. Set out on our website is a 
summary of the key information needed by clients and counterparties 
(together ‘customers’) to understand the measures TP ICAP is taking 
to safeguard the interests of its customers.

TP ICAP has robust internal policies and procedures in place which 
require all staff to identify and escalate any identified conflicts of 
interest, whether business or personal, in accordance with a formal 
escalation process. Such internal obligations enable the Group to 
continually identify new conflicts of interest which arise in its 
business and to implement those measures required to adequately 
monitor, manage and control the potential impact of those 
conflicts on its customers.

It is Company policy to make no political contributions and there 
are no exceptions in 2020. We incurred no ESG related fines 
in 2020.

Annual Report and Accounts 2020
60

Section 172

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

The Board promotes the success of the Company for the benefit of our members as a whole as well as a broad range of stakeholders 
that we recognise are material to the long-term success of the business. Details of how the Board has complied with its Section 172 duty 
is explained in our Section 172 statement within the governance section on pages 72 to 75 and incorporated by reference into this 
Strategic Report.

Non-financial information statement
We aim to comply with the new Non-financial Reporting requirements contained in sections 414CA and 414CB of the Companies 
Act 2006. The table below, and information it refers to, is intended to help stakeholders to understand our position on key non-
financial matters. The Board performs regular review of policies and standards, and where appropriate, reviews the outcome of these 
policies and standards.

Reporting requirement 
Environmental matters

Policies and standards which govern our approach 
Environment – our commitments
Corporate social responsibility policy

Employees

Human rights

Social matters

Anti-corruption and anti-bribery

Description of principal risks and 
impact of business activity

Global recruitment policy 
Employee relations policy 
Equal opportunity policy 
Joiners transfers and leavers policy 
Global training and development policy
Equality, diversity and discrimination – our commitments
Employee relations policy 
Equal opportunity policy 
Data protection and retention policy
Global whistleblowing policy
Physical security policy
Human rights and freedom of association – our commitments
Modern slavery statement
Charitable giving policy
Corporate social responsibility policy
Compliance manual
Anti-money laundering and counter terrorist financing policy
TP ICAP Americas anti-bribery and corruption policy
Global whistleblowing policy
Whistleblowing – our commitments
Bribery and corruption – our commitments
Enterprise Risk Management Framework
Change Management Policy
Risk Management Handbook
Tax risk and reporting policy
Financial risk management policy

Risk management and additional 
information
Environmental, Social and 
Governance: pages 50 to 60, 
Directors’ report: page 109
Environmental, Social and 
Governance: pages 50 to 60

Environmental, Social and 
Governance: pages 50 to 60

Environmental, Social and 
Governance: pages 50 to 60
Environmental, Social and 
Governance: pages 50 to 60

Principal risks and uncertainties: 
pages 46 to 49

Description of the business model Our business model, see pages 6 and 7
Non-financial key performance 
indicators 

Key performance indicators, see pages 26 and 27

Our business model: pages 6 and 7
Key performance indicators: pages 
26 and 27

This Strategic Report, from page 1 to 61 has been reviewed and was approved by the Board of Directors on 9 March 2021.

Nicolas Breteau 
Chief Executive Officer  

Robin Stewart
Chief Financial Officer

Annual Report and Accounts 2020
61

 
 
 
 
 
 
 
 
Compliance with the UK Corporate Governance Code and section 172

Compliance with the Code 
The Board reviewed the Principles and Provisions of the UK 
Corporate Governance Code 2018 (the ‘Code’) and its compliance 
with the Code throughout 2020. Following this review, the Board 
is pleased to confirm that the Company has applied the Code 
Principles and complied in full with the Provisions for the financial 
year ended 31 December 2020. The Code can be found on the 
Financial Reporting Council (‘FRC’) website, www.frc.org.uk, and 
further information on compliance with the Code and how the 
Principles have been applied by reference to each Provision is set 
out in the index on the following page. 

Annual Report and Accounts 2020
62

Index of Code Disclosures

Board leadership and Company purpose
The Company should be led by an effective and entrepreneurial 
Board that establishes the Company’s purpose, values and strategy, 
whilst ensuring that its responsibilities to its shareholders and 
stakeholders, including the workforce, are considered and met.

Provision
1 

2

3
4
5

6
7
8

Further information
Strategic Report p1 to 61 
Risks p46 to49
Sustainability p50 to 60
Governance p71
Culture p64
Board activities p70 to 71
Workforce remuneration p94
Shareholder engagement p74 
Significant votes against – non-applicable.
Stakeholder engagement and section 172 p72 to 75
Workforce engagement p73
Whistleblowing p88 
Managing conflicts of interest p76
Board meetings p68

Division of responsibilities
The Board, led by the Board Chair who is responsible for its 
effectiveness, should be comprised of Non-executive and Executive 
Directors who hold a diverse set of skills, experience and 
backgrounds. They each receive a comprehensive induction, have 
sufficient time to meet their Board responsibilities, and receive 
support from the Group Company Secretary, all of which enable 
them to carry out their duties effectively.

Provision
9 

10
11
12
13
14

15

16

Further information
Division of responsibilities p70
The Chair biography p66
Independence of Directors p76
Board composition p76 and 77
Senior Independent Director p70
Non-executive Directors p70
Role of the Board p68  
Division of responsibilities p70
Director biographies and external appointments 
p66 and 67
Group Company Secretary p70

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Composition, succession and evaluation
Companies should have an effective succession plan in place for 
both the Board and for members of senior management. This should 
take into consideration the skills, experience and knowledge 
needed for maximum effectiveness. The Board, and the Directors 
individually, should be evaluated yearly. Annual evaluation of the 
Board should consider its composition, diversity and its effectiveness. 
Individual evaluations should demonstrate whether each Director 
continues to contribute effectively.

Provision
17 

18
19
20
21 & 22
23

Further information
Nominations & Governance Committee – Membership 
and Report p81 to 83
Election and re-election of Directors p83
Director biographies p66 and 67
Board member recruitment p81
Board evaluation p79 to 80 
Report of the Nominations & Governance Committee 
p81 to 83

Audit, risk and internal control
The Board is responsible for determining the nature and extent 
of the principal risks the Company is willing to take in achieving 
its strategic objectives, and oversees the risk management and 
internal control systems in place with the support of the Audit 
and Risk Committees. The Board is also responsible for the 
establishment of policies which ensure the independence and 
effectiveness of both internal and external audit functions.

Provision
24 
25
26
27
28
29
30
31

Further information
Audit Committee – Composition and Report p84 to 88
Key responsibilities of the Audit Committee p84
Audit Committee Report p84 to 88
Fair, balanced and understandable assessment p86
Principal risks and uncertainties p46 to 49
Risk Committee–risk management and internal control p88
Going concern p43
Viability statement p43

Remuneration
Executive Directors’ remuneration has been designed to promote 
the long-term sustainable success of the Company. No Executive 
Director is involved in deciding his or her own remuneration.

Provision
32 

33
34
35
36

Further information
Remuneration Committee – composition and report 
p92 to 108
Remuneration Policy p95 to 97
Non-executive Director remuneration p106
Advice provided to the Remuneration Committee p108
Shareholding requirements – Remuneration Policy 
Statement p104

Compliance with section 172 of the Companies Act 2006
The Directors confirm that they have acted in a way that they consider, in good faith, to be most likely to promote the success of the 
Company for the benefit of its members as a whole, and in doing so had regard, amongst other matters, to:

 > the likely consequences of any decision in the long term;
 > the interests of the Company’s employees;
 > the need to foster the Company’s business relationships with suppliers, customers and others;
 > the impact of the Company’s operations on the community and the environment;
 > the desirability of the Company maintaining a reputation for high standards of business conduct; and
 > the need to act fairly as between members of the Company.

Detail on how the Directors have had regard to the factors in section 172 of the Companies Act 2006 (‘section 172’) when performing 
their duties and the Directors’ statement required under section 414CZA of the Companies Act 2006 are set out on pages 72 to 75.

Annual Report and Accounts 2020
63

 
 
 
 
 
 
 
Board Chair’s introduction to governance

Risk and controls
We made considerable progress during the year on embedding the 
Group’s Enterprise Risk Management Framework. The Board was 
pleased to hear considerable evidence, supported by third-party 
review, that colleagues throughout the organisation had embraced 
the Framework, and were using it every day to collect and report 
risk events, issues and losses. This is already providing an invaluable 
risk data set for the Group. The Framework will continue to develop 
as the Group evolves, especially with the Jersey redomiciliation and 
Liquidnet acquisition.

I am pleased that during the year we were able to strengthen the 
governance oversight of the UK based regulated entities, with three 
independent Non-executive Directors appointed to the Boards of 
those entities, including an independent Chair. Formal Risk and 
Remuneration Committees have also been created, and we have 
ensured a linkage with the Main Board Committees by inviting the 
Chairs of the UK regulated entities’ committees to attend periodic 
meetings of the Main Board Committees.

A new corporate structure and corporate governance framework 
Our intention to reorganise the corporate structure under a new 
Group holding company registered in Jersey was announced in 
December 2019 and I am delighted that, after a lot of hard work 
from colleagues and advisors over the last 15 months, we finally 
completed the redomiciliation on 26 February 2021. As previously 
advised, the intention of this reorganisation was not to change the 
Group’s tax domicile, which will remain in the UK, but rather to 
provide greater financial flexibility for the Group, support the 
effective governance of the business and ultimately to improve our 
competitiveness. The location of TP ICAP Group plc’s primary stock 
exchange listing remains in the UK, and legal, regulatory and 
advisory regimes will continue to apply to corporate governance 
and governance reporting, including the UK Corporate Governance 
Code. Similarly, we will continue to provide a s172 statement, albeit 
there is no equivalent reporting requirement under the Jersey 
Companies Act.

Under the new corporate structure, TP ICAP Group plc has 
delegated the responsibility for the local implementation of the 
Group’s global strategy, its oversight and supervision to separate 
sub-Group holding companies. The Group’s Governance Manual 
was recently updated to reinforce this new governance framework. 
Further detail on the Governance Manual is set out on page 68. 

Liquidnet and integration
At the beginning of February shareholders gave their overwhelming 
support for the acquisition of Liquidnet. We remain on track to 
complete the acquisition by the end of Q1 2021. The Board is 
mindful that this is just the start of an important process of 
integration. Planning and preparation for integration are well 
advanced; however, we recognise the importance of execution. 
To this end, the Board has decided to set up a Strategic Execution 
Committee, drawing membership from Executive and Non-
executive members of the Board as well as other key senior 
managers to conduct regular deep-dive oversight reviews, not 
only of the Liquidnet integration, but also of other key strategic 
initiatives of the Group.

Richard Berliand  
Board Chair

Dear fellow shareholder,

Sound corporate governance provides the foundations of successful 
and sustainable businesses and is particularly important during 
times of organisational stress and challenge. In common with other 
companies around the globe, TP ICAP was confronted by a once in 
a generation global pandemic, requiring TP ICAP’s Board and 
leadership team to be agile in assessing the challenges presented, 
and then be fleet in response. I am very grateful to my Board 
colleagues and, in particular, to the executive leadership team, for 
the commitment and dedication shown as we quickly reprioritised, 
adapted to the developing situation and maintained excellent 
communication channels between all members of the Board 
allowing critical decisions to be made swiftly while having regard 
for all our key stakeholders. 

Values and culture 
TP ICAP is defined by its core values – honesty, integrity, respect 
and excellence. They underpin everything that we do and were 
never more important than in 2020. As we entered COVID-19 
related lockdowns in various global locations, we reconfigured and 
adapted workflows and put in place attestation protocols so that 
a number of front office broking staff were able to work from home. 
This could not have been achieved without the confidence in our 
people to uphold our core values and stand up to the highest levels 
of scrutiny. The Board was pleased to note that there was no 
evidence of any significant increase in risk events or issues as 
a result of these changes.

These values also remain at the heart of our culture and will ensure 
that TP ICAP stays trusted, relevant, successful and sustainable. We 
are not complacent and expectations on conduct and behaviour 
are reinforced at every opportunity, whether through the 
compulsory all-staff training programme or through regular internal 
communications from senior management and the Chief Executive 
Officer. In the Spring of last year, a revised Code of Conduct was 
launched that further reinforced expectations around conduct 
and behaviours. 

The linkage between employee behaviour and reward was also 
strengthened, with the introduction of a formal risk-adjusted 
performance review between Group control heads and the 
Remuneration Committee chair. In addition, during the year the 
Company also introduced a new Broker Equity Linked scheme, 
whereby a percentage of variable broker pay above a certain 
threshold will be deferred and can be subject to clawback in the 
event of behavioural or conduct issues coming to light. 

Annual Report and Accounts 2020
64

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Our commitment to diversity does not stop at the Board. Driving 
diversity and inclusion throughout TP ICAP remains a key objective 
for the Executive team. There has been significant progress in the 
last year, in particular at the senior management level. In 
September we submitted our latest Women in Finance data to the 
Treasury which showed that over 31% of our senior managers were 
women, compared to 16% the year before. 

Finally, I am very pleased that we are able to reinforce our 
commitment as a Board to environmental, social and governance 
(ESG) matters with the appointment at the beginning of March 2021 
of Tracy Clarke as our Non-executive ESG Engagement Director.

Board effectiveness
This year we conducted an internal Board evaluation process, 
having conducted an externally facilitated exercise last year. I am 
pleased that the evaluation confirmed that the Board operated 
effectively and responded well to the pandemic. However, there 
were opportunities identified for improvement and development: 
further detail on the evaluation and actions agreed for 2021, as well 
as the steps taken over the last year in response to the 2019 evaluation 
can be found on pages 79 to 80.

Compliance with the Code 
We have reviewed our governance framework with reference to the 
2018 UK Corporate Governance Code, and a statement of compliance 
with the Code is set out on page 62.

Conclusion
Shareholders and other key stakeholders will be assured at how, 
within a clear and defined governance framework, the Board and 
Leadership Team responded to the challenges presented in 2020. 
However, it is likely that many of these same challenges will be with 
us for some time to come, and the Board must also focus on and 
remain alive to the challenges of execution – not only of the 
Liquidnet acquisition and integration, but also of the Company’s 
other strategic initiatives. It is shaping up to be another year 
of learning. 

Richard Berliand
Board Chair
9 March 2021

An evolving Board
The Board was pleased to welcome Angela Crawford-Ingle and 
Mark Hemsley to the Board in March last year, and since the end of 
the year we have been joined by Tracy Clarke and Kath Cates, who 
were appointed on 1 January 2021 and 1 February 2021, respectively.

Lorraine Trainer stepped down as a Non-executive Director of the 
Company in Spring last year. Angela Knight, who had been due to 
retire from the Board in May last year, agreed instead to remain on 
the Board for the near-term. Angela will now be stepping down at 
the conclusion of the 2021 Annual General Meeting, as will Roger 
Perkin. Angela has been a member of the Board for nine and a half 
years and Roger is approaching nine years of tenure. It goes 
without saying that the Board will miss their considerable 
knowledge, experience and skills. Two important senior positions 
on the Board are hard to replace. However, I am pleased that 
Michael Heaney has agreed to become Senior Independent 
Director, and Angela Crawford-Ingle Chair of the Audit Committee, 
having shadowed Roger for the last year. Kath Cates will succeed 
Michael Heaney as Chair of the Risk Committee and Tracy Clarke 
will succeed Angela Knight as Chair of the Remuneration 
Committee. We thank Angela and Roger and wish them all the 
very best for the future.

While the Board remains committed to maintaining a healthy 
turnover in its Non-executive composition, I am mindful that we are 
a ‘young’ Board, the longest tenure of any one member after these 
most recent departures being three and a half years. This was an 
important consideration in the search and selection process over 
the last year, and each new Director brings broad and 
complementary experience, skills and knowledge to the Board. 
Further information in relation to all Board members, their 
knowledge and experience, as well as their other current external 
appointments may be found on pages 66 to 67.

Diversity
I am delighted that we have been able to attract individuals of such 
high calibre to the Board. I am also very pleased that three of the 
four most recent appointments were women, and each of them will 
assume the Chairs of the respective Audit, Remuneration and Risk 
Committees in May. The Board remains committed to cultural, 
ethnic and gender diversity, recognising the benefits that diversity 
brings in terms of different experiences and perspectives, which 
ultimately lead to better Board decisions. The Company has been 
compliant with the Parker Review ethnicity representation target 
since November 2017. 

I advised last year that the Board would target a minimum of 30% 
female representation by the end of 2021 and beyond. We achieved 
that target with Tracy’s appointment, and, at the date of this 
report, Board membership comprises 33% women. This percentage 
falls back to 30% after the Annual General Meeting in May. There 
have been recent important deliberations by the Nominations & 
Governance Committee in relation to the balance of, and the 
experience, skills and knowledge on, the Board. We have decided 
that the Board should meet the Hampton Alexander female 
representation target and we are committed to having a minimum 
33% women on the Board by the end of 2021 and beyond. To this 
end, the role specification will soon be finalised and a search for 
a new Non-executive Director will commence in Q2 2021.

Annual Report and Accounts 2020
65

 
 
 
 
 
 
 
Board of Directors

Richard Berliand 
Board Chair

N

Nicolas Breteau 
Executive Director and 
Chief Executive Officer

Robin Stewart
Executive Director and 
Chief Financial Officer

Appointed
19 March 2019 and 
Chair with effect from 
15 May 2019

Board skills and experience: Richard combines 
a detailed understanding of the financial 
services industry and its challenges and 
opportunities with recent senior board 
leadership experience, having held roles as 
Senior Independent Director and Deputy 
Chairman at other listed financial institutions. 
Through his broad business experience and 
previous external roles Richard brings extensive 
external insight, a deep understanding of 
relevant issues and the strong corporate 
governance expertise required to lead an 
effective Board and develop its strategy. 
He also brings considerable experience of 
engagement with key stakeholders of 
the business. 

Career: Richard had a 23-year career at 
JP Morgan where he served most recently as 
Managing Director leading the global cash 
equities and prime services businesses. He was 
also a member of the board of directors of 
Rothesay Life plc until February 2019 and a 
member of Deutsche Börse AG’s supervisory 
board until May 2019.

External appointments: 
Senior Independent Director and Chairman of 
the Remuneration Committee of Man Group plc.

Appointed
10 July 2018

Appointed
10 July 2018

Board skills and experience: Nicolas’ extensive 
experience across the global broking industry 
complements his in-depth knowledge of the 
Group’s operations and markets and enables 
him to lead the business and be a key contributor 
to the Board. Nicolas continues to lead the 
implementation and development of the 
Board’s strategy and identifies new opportunities 
for the continued future growth of the business. 
He maintains a productive dialogue with 
institutional investors and other key 
stakeholders of the business.

Board skills and experience: Robin brings to 
the Board financial expertise coupled with 
strong leadership skills developed both within 
TP ICAP plc and the wider industry over more 
than 20 years. His comprehensive knowledge 
of the financial position of the Group enables 
him to make a strong contribution to the Board 
and when engaging with investors and other 
stakeholders. He helps to drive the operational 
performance of the business and provides 
valuable expertise in financial risk 
management.

Career: Nicolas has held senior managerial 
roles at MATIF (later part of Euronext) and 
most recently prior to joining TP ICAP, as Chief 
Executive of Newedge Group. Before his current 
appointment, he was CEO of TP ICAP’s largest 
business, Global Broking. Nicolas has also 
held directorship roles in Europe, Asia and 
the Americas at the Futures and Options 
Association (UK), Futures Industry Association 
(USA), Citic/Newedge (China) and Altura (Spain).

External appointments: 
None.

Career: Robin started his career at Arthur 
Andersen and after that he spent 13 years at 
Dresdner Kleinwort where he was director and 
deputy head of tax. He joined the Group 
originally as Head of Tax in 2003 and has since 
held the roles of Head of Group Finance and Tax, 
Group Financial Controller and Deputy CFO and 
Financial Controller. 

External appointments: 
None.

Philip Price
Executive Director and 
Group General Counsel

Roger Perkin 
Independent 
Non-executive Director 

N   Ri   A  

Edmund Ng 
Independent 
Non-executive Director 

N   Ri   Re  W

Appointed
3 September 2018

Appointed
1 July 2012

Appointed
1 November 2017

Board skills and experience: Philip has over 
30 years’ experience gained in senior roles in 
the corporate and financial services sector. 
His knowledge and expertise enables him to 
bring a valuable perspective to the Board’s 
consideration of risk, governance, legal and 
compliance issues and he is able to provide the 
Board with insight as to the dynamic and 
complex regulatory environment in which TP 
ICAP operates. Having spent his career variously 
in London, Europe and Hong Kong, Philip also 
brings an understanding and insight into a 
number of the Group’s key operating markets.

Career: Prior to joining the Group in 2015, 
Philip held senior executive roles in UK listed 
companies, investment banks and alternative 
investment sector. Philip is admitted as a Solicitor 
of the Senior Courts of England & Wales. 

External appointments: 
None.

Board skills and experience: Roger’s 
longstanding financial and accounting career, 
combined with his extensive board experience, 
provide a valuable skillset as Audit Committee 
Chair and member of the Risk Committee and 
ensure he brings a high degree of scrutiny, 
additional challenge and oversight to the 
Board. He brings an excellent understanding of 
investor expectations as well as experience in 
managing relationships with the investor and 
financial communities. Having served almost 
nine years, Roger has indicated his intention to 
step down from the Board and accordingly will 
not be seeking re-election at this year’s AGM.

Career: Roger is a qualified accountant and 
spent over 40 years at EY before retiring from 
the firm in 2009. He was formerly a Non-
executive Director at The Evolution Group plc, 
Electra Private Equity plc, Friends Life Group 
and Nationwide Building Society.

External appointments: 
Non-executive Director of Hargreaves 
Lansdown plc; Non-executive Director of 
AIB Group (UK) plc; a trustee of two charities: 
Chiddingstone Castle; and the Charities 
Aid Foundation. 

Board skills and experience: With over 20 
years’ experience of the Asian capital markets 
Edmund brings a deep understanding of and 
insight into one of our key markets at Board 
level. In addition, his years of experience at 
the Hong Kong Monetary Authority enable 
Edmund to bring an in-depth understanding 
of complex financial regulatory regimes to 
the Board. As Workforce Engagement Director, 
Edmund also represents very effectively the 
views of employees from the APAC region in 
Board discussion.

Career: Edmund is currently Chief Investment 
Officer and co-founder of Eastfort Asset 
Management, which was established in 
mid-2015 with Brummer & Partners in Sweden. 
Prior to that he served as Head of the Direct 
Investment Division of Hong Kong Monetary 
Authority (‘HKMA’) and Managing Director 
of Asia Ex-Japan trading within J.P.Morgan.

External appointments: 
Chief Investment Officer and co-founder 
of Eastfort Asset Management.

Annual Report and Accounts 2020
66

 
Key

A  Audit Committee

 Chair

N  Nominations & Governance Committee

 Member

Re Remuneration Committee

Ri  Risk Committee

W  Workforce Engagement Director
External appointments: all listed and regulated 
external appointments are disclosed.

Kath Cates 
Independent 
Non-executive Director
Risk Committee Chair
Designate 

Appointed
1 February 2021

N   Ri   A  

Tracy Clarke 
Independent 
Non-executive Director
Remuneration 
Committee Chair 
Designate 

Appointed
1 January 2021

N   Re 

Angela Crawford-Ingle 
Independent 
Non-executive Director 
Audit Committee Chair 
Designate

Appointed
16 March 2020

N   Ri   A

Board skills and experience: Kath brings to 
the Board a wealth of experience in global 
financial services with over 25 years in executive 
roles based in Hong Kong, London, Singapore 
and Zurich. As Global COO, her responsibilities 
spanned risk, legal and compliance, operations, 
IT, brand, HR and strategy. More recently as 
a Non-executive Kath has gained broad 
experience on the main boards of a number 
of companies, chairing Board committees and 
acting as Senior Independent Director. 

Career: Kath was previously Global COO, 
Wholesale Banking for Standard Chartered 
Bank plc. Prior to that Kath spent over 20 years 
at UBS in a variety of senior roles including 
Global Head of Compliance. Kath was until 
recently a Non-executive Director of Brewin 
Dolphin Holdings plc where she was Chair of 
the Risk Committee.

External appointments: Non-executive 
Director of United Utilities Group plc; 
Non-executive Director and Chair of the 
Remuneration Committee of RSA Insurance 
Group plc; Non-executive Director of several 
companies in the Columbia Threadneedle 
Group including Chair of Audit of Threadneedle 
Pensions Limited. 

Board skills and experience: Tracy brings to 
the Board considerable international banking 
and financial services experience, having most 
recently served as a Director of Standard 
Chartered Bank UK for seven years. Her prior 
Non-executive appointments include Chair of 
the remuneration committees of Sky plc and 
Eaga plc, and she is therefore well positioned 
to chair the Remuneration Committee from the 
conclusion of the 2021 Annual General Meeting. 
Her previous experience will also be valuable in 
her role as ESG Engagement Director.

Career: As well as having been Director of 
Standard Chartered Bank UK from January 
2013 until 31 December 2020, Tracy served as 
Non-executive Director of Standard Chartered 
First Bank in Korea, Zodia Holdings Limited and 
Zodia Custody Ltd. She has also chaired the 
boards of Standard Chartered Bank AG and 
Standard Chartered Yatirim Bankasi Turk A.S. 
She was also Non-executive Director of 
Inmarsat plc, China Britain Business Council 
and recently stepped down as Non-executive 
Director of TheCityUK. 

External appointments: 
Non-executive Director and Chair of the 
Remuneration Committee of the All England 
Netball Association.

Board skills and experience: Angela brings 
substantial experience to the Board, both from 
her executive career, as well as from her other 
Non-executive Director roles in financial services. 
She delivers scrutiny and oversight to the Board 
from her extensive experience of audit of 
multinational and listed companies.

Career: Angela, a chartered accountant, was 
a Partner specialising in financial services at 
PricewaterhouseCoopers for 20 years, during 
which time she led the Insurance and Investment 
Management Division. She has previously 
served in Non-executive Director roles at 
Beazley plc and Swinton Group Limited.

External appointments: 
Senior Independent Director and Chair of the 
Audit Committee at River and Mercantile Group 
plc; Non-executive Director and Chair of the Audit 
Committee of Openwork Holdings and Council 
member and Chair of the Audit Committee of 
Lloyd’s of London.

Michael Heaney 
Senior Independent 
Director Designate 

N   Ri   Re  W

Mark Hemsley 
Independent 
Non-executive Director 

N   Ri   W

Angela Knight 
Senior Independent 
Non-executive Director

N   Ri   Re  A

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Appointed
15 January 2018 

Appointed
16 March 2020

Appointed
1 September 2011

Board skills and experience: Michael brings to 
the Board significant knowledge of financial 
markets, both in the USA and the UK, as well as 
expertise in international financial management 
from his long career in financial services. His prior 
experience of operations and risk management 
at senior level has been invaluable in his role as 
interim Chair of the Risk Committee. As Workforce 
Engagement Director his perspective ensures that 
he understands and brings the views of employees 
in the Americas region to Board discussions.

Career: During a distinguished career Michael 
served as Global Co-Head of the Fixed Income 
Sales and Trading Division for 28 years at 
Morgan Stanley, both in New York and London. 
He was also a member of Morgan Stanley’s 
Operating, Management and Risk 
Management Committees.

External appointments: 
Chairman of the US Securities and Exchange 
Commission Fixed Income Market Structure 
Advisory Committee.

Board skills and experience: Mark draws 
on his extensive experience of capital markets 
and exchanges from his executive career in 
the industry. His knowledge of large scale 
technology infrastructure, operations and 
oversight of operational transformation in 
several international exchanges and trading 
platforms is invaluable to the Board. During 
the year Mark assumed the role of Workforce 
Engagement Director for EMEA and has 
commenced engagement with colleagues to 
bring the perspectives of EMEA employees to 
Board discussions. 

Career: Mark was President of Cboe Europe 
until his retirement in early 2020. Prior to that 
he was Chief Executive Officer at Bats Global 
Markets in Europe, Managing Director, Market 
Solutions at LIFFE and Director Global 
Technology at Deutsche Bank GCI. Mark was 
also a board member of EuroCCP NV and was 
a member of the ESMA Securities and Markets 
Stakeholder Group and Securities and Markets 
Consultative Working Group.

External appointments: 
None.

Board skills and experience: Angela brings 
a wealth of knowledge and experience, 
stemming from her previous Chief Executive 
and Non-executive Director roles. Her prior 
experience as a Member of Parliament and 
Treasury Minister brings a unique and valuable 
perspective to Board discussions. She delivers 
scrutiny and independent oversight to the 
Board. Having served over nine years, Angela 
has indicated her intention to step down from 
the Board and accordingly will not be seeking 
re-election at this year’s AGM.

Career: Angela has had a longstanding career 
including Chief Executive roles at Energy UK, the 
British Bankers’ Association and the Association 
of Private Client Investment Managers and 
Stockbrokers, as well as previous Non-executive 
Directorships at Lloyds TSB, Scottish Widows and 
Brewin Dolphin Holdings plc.

External appointments: 
Non-executive Director of Taylor Wimpey PLC; 
Non-executive Director of Arbuthnot Latham & 
Co Ltd; Non-executive Director of Provident 
Financial Group Plc and Board member of 
Encore Capital Group Inc. 

Annual Report and Accounts 2020
67

 
 
 
 
 
 
 
 
Corporate governance report

Board meetings
The Board has a schedule of eight meetings a year to discuss the 
Group’s ordinary course of business in accordance with a detailed 
annual forward agenda developed by the Chair and the Group 
Company Secretary and agreed by the Board. Every effort is made 
to arrange Board meetings so all Directors can attend. Additional 
meetings are arranged on an ad-hoc basis as required and whilst 
every effort is made to arrange that all Board members are able to 
attend these additional meetings, as they are often at relatively 
short notice that is not always possible. All Board and Board 
Committee meetings are minuted. These summarise the principal 
points discussed during an item’s deliberation and record any 
unresolved concerns and actions arising from the discussion. 
In addition to the eight scheduled meetings there were seven 
further ad-hoc meetings held at short notice as well as numerous 
Board briefing calls led by the Chief Executive Officer, including to 
provide regular updates to the Board on the Company’s response to 
the COVID-19 pandemic. In most cases all eligible Board members 
were able to attend these additional meetings. 

2020 Board meeting attendance

Director
Richard Berliand
Nicolas Breteau
Angela Crawford-Ingle2
Michael Heaney
Mark Hemsley3
Angela Knight
Edmund Ng
Roger Perkin
Philip Price
Robin Stewart
Lorraine Trainer4

Meetings
attended1
8/8
8/8
6/6
8/8
6/6
8/8
8/8
8/8
8/8
8/8
4/4

1  Annual scheduled meetings only. See above for details of ad-hoc meetings. 
2  Angela Crawford-Ingle was appointed as a Director of the Board on 16 March 2020.
3  Mark Hemsley was appointed as a Director of the Board on 16 March 2020.
4  Lorraine Trainer stepped down as a Director of the Board on 13 May 2020. 

More online
The Board Matters Reserved and Committee  
Terms of Reference can be found at: 
www.tpicap.com/investors

The role of the Board and its Committees 
The Board is collectively responsible for the effective oversight of 
the Company and the long-term success of its business. The formal 
Schedule of Matters Reserved for the Board describes the role and 
responsibilities of the Board in full and is subject to annual review. 

The Board delegates some of its responsibilities to the Audit, 
Nominations & Governance, Risk and Remuneration Committees, 
through agreed Terms of Reference which are subject to annual 
review. The responsibilities of each Committee are described in the 
governance framework on the page opposite and in the relevant 
Committee reports. 

Responsibilities are also delegated by the Board to the Disclosure 
Committee through agreed Terms of Reference which are subject 
to annual review. The Disclosure Committee is responsible for 
considering on an ongoing basis, in accordance with legal and 
regulatory obligations and the Group Disclosure Policy, whether 
any recent developments in the Group’s business are such that 
a disclosure obligation has, or may, arise and makes 
recommendations to the Board as appropriate.

The Board also delegates responsibility for the day-to-day 
operational management of the Company to the Chief Executive 
Officer, who is supported by the Executive Committee, Group 
Management Committee (‘GMC’), Group Business Committee 
(‘GBC’), Group Operations Committee (‘GOC’) and the Group Risk, 
Culture and Conduct Committee (‘GRCCC’). The Group executive 
level Committees are chaired by the Chief Executive Officer, except 
the GRCCC which is chaired by the Group General Counsel and 
the GOC which is chaired by the Chief Operating Officer. The 
Committee responsibilities are described in the governance 
framework on the page opposite. 

Group Governance Manual and policies
A governance framework is in place, approved by the Board, 
setting out the decision-making and reporting lines across the 
Group and authority levels delegated by the Board to certain 
Committees, individual Directors and senior management. The 
Group Governance Manual sets out the governance framework in 
relation to the Group’s central and regional governance structures, 
and documents the operation and governance of the Group’s UK 
regulated entities, taking into consideration governance and 
regulatory developments, including the Senior Managers and 
Certification Regime. Most recently the Group Governance Manual 
has been revised to reflect the Group’s new organisational structure 
following the redomiciliation of the ultimate holding company to 
Jersey and the consequential changes to the governance framework. 

The Company has clearly defined policies, processes, procedures 
and controls which are subject to continuous review in order to meet 
the requirements of the business, the regulatory environment and 
the market. Ultimate decision-making on matters affecting a legal 
entity is reserved for the legal entity board.

Annual Report and Accounts 2020
68

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Governance framework

Board

Has principal responsibility for promoting the long-term sustainable success of the Company, generating value for its shareholders and 
contributing to wider society.

Provides strategic 
leadership

Determines the 
Group’s purpose, values 
and strategy and ensures 
these are aligned with 
the culture.

Ensures the 
necessary resources are 
in place to meet 
Company objectives and 
measure performance 
against them. 

Ensures that controls 
and risk management 
systems are rigorous and 
effective throughout the 
organisation. 

Determines 
the Group’s risk 
appetite and nature 
and extent of the 
principal risks and 
considers other matters 
escalated from the 
Board’s Risk 
Committee

Determines what 
matters are reserved for 
decision of the Board

Board Committees

Nominations & 
Governance
Responsible for 
reviewing the balance 
of skills, knowledge, 
experience and diversity 
of the Board and UKRE 
boards, making 
recommendations for 
Board, Committee and 
UKRE Non-executive 
Director appointments 
and monitoring 
succession plans. Also 
has responsibility for 
reviewing and making 
recommendations on all 
matters of corporate 
governance.

Remuneration 
Responsible for 
developing, maintaining 
and recommending to 
the Board formal and 
transparent policies on 
remuneration for the 
Company’s employees, 
including the Directors’ 
Remuneration Policy. 
Makes recommendations 
to the Board on the 
remuneration packages 
of the Executive Directors 
and other members of 
senior management, in 
compliance with policy.

Risk
Reviews and makes 
recommendations to 
the Board on the 
Group’s risk appetite, 
risk principles and 
policies so the risks are 
reasonable and 
appropriate for the 
Group and can be 
managed and 
controlled within the 
limits of the Group’s 
resources. Ensures 
adherence to 
risk principles 
and thresholds.

Audit
Ensures the governance 
and integrity of 
financial reporting and 
disclosures, reviewing 
the controls in place. 
It oversees the internal 
audit function and the 
relationship with the 
external auditors, 
including monitoring 
independence. The 
Committee also reviews 
the effectiveness of 
internal controls in 
the Group.

For more see page 81

For more see page 92

For more see page 89

For more see page 84

Executive
Responsible for defining 
and refining  strategic 
proposals and 
reviewing the success 
of implementation of 
Group strategy, 
overseeing performance 
against the strategy 
and budget on a 
business line and 
regional basis. 
It monitors the 
implementation and 
progress of risk and 
culture activities. 
The Committee makes 
recommendations to 
the Board and Legal 
Entities in accordance 
with the authority levels 
delegated by the Board.

Group Management Committee

Group Business Committee

Responsible for periodically monitoring and reviewing current 
business performance against budget and agreed strategy, 
developing and influencing future strategy and making 
recommendations for variation of current strategy for 
consideration by the Executive Committee. The Committee 
considers the resourcing for the delivery of future strategy.

Responsible for exercising oversight of the Group’s commercial 
issues and current business performance with reporting by 
business line. It also develops ideas on future strategy for 
consideration by the Executive Committee.

Group Operations Committee

Group Risk, Culture and Conduct Committee

Responsible for exercising oversight of the performance of 
support functions, overseeing significant Group projects and 
initiatives, monitoring operational risk within the support 
functions, reviewing, approving and prioritising potential change 
initiatives, exercising oversight of budget and cost in support 
functions and approving and reviewing support function policies. 

Responsible for providing executive oversight of the Group’s 
enterprise risk management framework, reviewing and 
maintaining progress against cultural objectives and monitoring 
conduct within the Group. Communicates with and makes 
recommendations to the Executive Committee, Risk Committee 
and Audit Committee as appropriate.

Annual Report and Accounts 2020
69

 
 
 
 
 
 
 
The Board’s activities
In addition to the eight scheduled meetings, numerous off-cycle 
Board meetings and briefings were held in 2020 at which the Board 
discussed, among other matters, COVID-19 and the impact to the 
business and its staff, the Liquidnet acquisition, the Jersey 
redomiciliation and changes to Board membership. The Board 
also held a strategy update in January 2020. 

Over the course of the year, the Non-executive Directors held 
occasional virtual meetings without the Executive Directors 
present to facilitate full and frank discussion, where they discussed 
the performance of the executive management team, among 
other matters.

The Board activities pie chart below and the table on the 
page opposite show how the Board spent its time at scheduled 
Board meetings during the year, including the key areas of focus 
and discussion.

How the Board spent its time during 
the year in scheduled meetings
%

CFO updates including 
dividend, tax matters 
and investor relations

CEO updates, including 
COVID-19 response
Business/Management updates
including operations and
technology
Strategy including 
corporate transactions
Employees, ESG and Culture
and Stakeholders
Legal and Compliance
Risk management and 
audit including Brexit
Routine matters
Corporate Governance 
and Policies

22%

16%

13%

13%

11%

8%
7%

6%
4%

Corporate governance report 
continued

Division of responsibilities
The roles of the Board Chair and Chief Executive Officer are 
separate and a formal statement of division of responsibilities 
has been adopted by the Company.

Board Chair: Independent on appointment and leads the Board 
by facilitating the effective contribution of all Directors and 
ensuring high standards of corporate governance. Chairs the 
Board meetings, sets the Board agendas and promotes effective 
relationships between the Executive Directors and Non-
executive Directors.

Chief Executive Officer: Accountable to, and reports to, the 
Board. Responsible for developing and implementing the 
strategy, setting the cultural tone throughout the organisation 
and providing coherent executive leadership in running the 
Group’s operations and activities.

Executive Directors: Support the Chief Executive Officer in 
developing and implementing the Group strategy and leading 
the Company, which is consistent with its purpose, culture and 
values. Provide specialist knowledge and experience to 
the Board.

Non-executive Directors: Independent of management, assist 
in developing and approving the strategy. Provide independent 
advice and constructive challenge to management, bring 
relevant experience and knowledge and serve on the Board 
Committees. Support the Chair by ensuring effective governance 
across the Group and reviewing the performance of the 
Executive Directors.

Senior Independent Director: Discusses with shareholders any 
concerns they have failed to resolve through the normal channels 
of Chair, Chief Executive Officer or Chief Financial Officer, or for 
which such contact is inappropriate. Provides a sounding board 
for the Chair and is available to act as an intermediary for other 
Directors when necessary. Responsible for reviewing the 
effectiveness of the Chair. Michael Heaney will be replacing 
Angela Knight as Senior Independent Director upon her 
retirement from the Board at the conclusion of the Company’s 
2021 Annual General Meeting.

Group Company Secretary: Advises the Board on matters 
of corporate governance and ensures that the correct Board 
procedures are followed. All members of the Board and 
Committees have access to the services and support of the 
Group Company Secretary.

More online
The Division of Responsibilities can be found at:
www.tpicap.com/investors

Annual Report and Accounts 2020
70

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Key agenda items discussed by the Board
Some of the key strategic priorities and areas discussed and reviewed by the Board in 2020 are shown below:

Strategic and operational priorities
Strategy formulation, 
implementation and 
monitoring

Build and sustain 
technology expertise
Develop our people

Enhance operational  
expertise
Financial performance, 
including results, capital  
and liquidity

Corporate governance and 
risk, including regulatory 
outcomes

ESG, including stakeholder 
engagement

Key activities and discussions
 > Regular Chief Executive Officer’s reports 
 > Acquisition strategy including Liquidnet acquisition, corporate transaction approvals and post 

investment reviews

 > Technology redeployment and workflow redesign in response to COVID-19
 > Reports from the Americas, EMEA and Asia Pacific regions
 > Presentations from the business including Data & Analytics, Energy & Commodities and eMarkets
 > Brexit planning and implementation
 > Dedicated strategy session
 > Presentations on technology and cyber risk 
 > Deep dive on cyber security
 > Culture and conduct initiatives 
 > Diversity and inclusion
 > Employee wellbeing and working environment, including COVID-19 measures to safeguard 

our people

 > Employee share plans
 > Employee development
 > Gender pay gap review
 > Whistleblowing updates, in conjunction with the Audit Committee
 > Presentation on operations, including updates on transition of roles to Belfast 
 > Internal and external communications strategy
 > Regular Chief Financial Officer’s reports including financial performance
 > Three-year financial plan updates
 > Financial strategy
 > Approval of the 2020 Group budget and discussion of the 2021 budget setting process
 > Approval of 2019 year end results, the Annual Report and Accounts, the AGM circular and dividends
 > Review of dividend policy
 > Group review of capital and liquidity adequacy
 > Approval of interim results and review of trading statements 
 > Viability statement and going concern
 > Pillar 3 disclosures
 > Group insurance renewal
 > Reports of the activities of the Audit, Risk, Remuneration and Nominations & Governance Committees
 > Withdrawal of the United Kingdom from the European Union and consequences for the Group 
 > Impact of Covid-19 on operations and financial results
 > Risk strategy, risk assurance plan and risk appetite statements
 > Regular legal and compliance reports
 > Corporate restructure, including Jersey domicile
 > Presentations from the CRO, including on embedding a good risk culture
 > Conflicts of interest
 > Corporate governance matters, including approval of the Group Governance Manual, Matters 

Reserved for the Board, Division of Responsibilities, Schedule of Delegations and Group Expenditure 
Control Framework
 > Board appointments
 > Board and Committee evaluation
 > Board and Committee Terms of Reference reviews
 > Review of Securities Dealing Code
 > Review of Modern Slavery Statement
 > CSR and ESG strategy and reports
 > Shareholder engagement and feedback on corporate transactions
 > Investor relations reports and shareholder analysis
 > Review of the charitable giving policy 
 > Climate change and environmental sustainability
 > Engagement with the FCA
 > Supplier engagement
 > Presentation from the Head of CRM

Annual Report and Accounts 2020
71

 
 
 
 
 
 
 
Corporate governance report 
continued

How the Board has satisfied its section 172 duty

The Board is committed to actively engaging with its stakeholders 
to ensure their interests are considered amongst other factors in 
Board discussions and decisions. Whilst physical engagement was 
challenging during the year, the Board took a number of steps to 
maintain active engagement with its stakeholders and ensure their 
views were taken into account in strategic decisions promoting the 
long-term sustainable success of the Company. This section of the 
Governance Report sets out how the Directors have had regard to 
the matters in section 172 of the Companies Act 2006 and forms 
the Directors’ statement required under section 414CZA of the 
Company’s Act 2006. A similar statement will be reported in the 
statutory accounts for each of our active UK subsidiaries for the 
year ended 31 December 2020. 

Our stakeholders
The Board reviewed the stakeholder mapping exercise carried out 
in 2018 and determined our key stakeholder groups remained 
employees, shareholders, clients, regulators and suppliers. In 
addition, environmental and community matters are key areas of 
importance. The Board also reinforced its commitment to ESG by 
appointing Tracy Clarke as the dedicated Non-executive Director 
for ESG matters whose role will be to ensure that the Board 
continues to consider the environmental and societal impact of its 
decisions alongside other key stakeholders. You can read more on 
this in the Chair’s statement on page 65 and in the Strategic Report 
on pages 50 to 60.

How we engage
The Board tailors its engagement approach for each key 
stakeholder group in order to foster effective and mutually 
beneficial relationships. On pages 73 to 75 we set out our key 
stakeholder groups and the main methods used to engage with 
them. The Board monitors the effectiveness of these engagement 
mechanisms as part of the Board evaluation process. 

To support the Board’s endeavours to better engage with and 
consider the interests of our stakeholders, Board paper templates 
invite appropriate focus on section 172 considerations to ensure 
stakeholder feedback is taken into account in the Board’s 
decision making. 

Annual Report and Accounts 2020
72

Case Study: The Board’s response to the pandemic 
Stakeholder consideration: employees, clients, regulators, 
shareholders, suppliers

The Board’s response to the pandemic required a balanced 
consideration of a number of stakeholders, as well as broader 
societal considerations. From the outset the Board was focused 
on protecting the wellbeing of its employees as a priority: Board 
briefing video conference meetings were held to discuss remote 
working and the implementation of safeguarding measures for 
those who continued to work in the office on a rotational basis. 
Among the measures was the dispatch of safety kits (including 
face masks) to staff in preparation for their return to the office. 

At the same time the Board was mindful of maintaining 
continuity of service to clients, discussing the rapid 
redeployment of technology, setting up communication lines 
and designing workflows to allow brokers to continue servicing 
their clients.

In addition, the Board was kept apprised of the steps being 
taken to ensure appropriate monitoring and surveillance was in 
place for brokers working from home and that remote broking 
activity continued to comply with regulators’ requirements. 
At the start of the crisis, briefings to discuss these stakeholder 
considerations were being held approximately every two weeks 
and included an update on discussions with regulators. Also, 
as part of the Board’s early deliberations in response to the 
pandemic, consideration was given to whether an adjustment 
or suspension to the final dividend payment for the year ended 
2019 should be made – it was decided not to make any 
adjustments at the time. Payment practices were also discussed 
and the Board was keen to ensure that invoice payment 
turnaround times were not significantly impacted by COVID-19. 

Case Study: Liquidnet acquisition
Stakeholder consideration: shareholders, clients,  
regulators, employees

Active dialogue between the Board Chair, Board members 
and shareholders was key to driving forward the Liquidnet 
acquisition and rights issue capital raise, which was approved by 
a significant majority of shareholders in February 2021 and is on 
schedule to complete in late March 2021. The Board considered 
this opportunity as one which would promote the success of 
the Company in the long term and create long-term value for 
shareholders, but also considered how our customers, and those 
of Liquidnet, would view the acquisition and the possible 
business opportunities the combination might present. Members 
of the Board engaged with the regulators for feedback on the 
proposed acquisition to ensure the acquisition and capital raise 
complied with regulatory requirements and any concerns 
were addressed. 

Following the announcement of the intention to acquire 
Liquidnet, employees were kept informed directly through 
emails from the Chief Executive Officer. The Remuneration 
Committee also discussed and addressed the potential impact 
of the rights issue on employee share awards and employee 
communications provided assurances and FAQs. 

How we engage – employees

Why we engage
The Board recognises that our people are critical to the success 
of the business. Engaging with employees at all levels and 
understanding their needs enables the Board to ensure that we 
retain and develop the best talent across the organisation. 
Employee engagement also helps the Board ensure that the 
Company’s culture, based on its core values of honesty, integrity, 
respect and excellence, is well embedded in the business and is 
aligned to the Company’s purpose and strategy.

While the Company is required to put in place a mechanism for 
engaging with UK employees, given the geographic spread of 
the business, the Board decided in 2018 to include employees 
across all our regions in the Workforce Engagement Programme 
described below.

How we engage 
During the year, Mark Hemsley replaced Lorraine Trainer as the 
nominated Workforce Engagement Director in EMEA region, 
including the UK. The purpose of the role is to gain an insight into 
regional specific issues and employee views and share these with 
the full Board so that these may be considered as part of the 
decision-making process, where appropriate. Michael Heaney 
and Edmund Ng remain the appointed Workforce Engagement 
Directors for the Americas and Asia Pacific regions, respectively.

Given the challenges presented in the year by the COVID-19 
pandemic, employee engagement was slightly different this year 
with social distancing measures across our regions impacting 
face-to-face sessions that had been planned as part of the 
Workforce Engagement Programme. Despite the challenges, some 
virtual sessions between Engagement Directors and colleagues 
were conducted: it is hoped that a fuller direct engagement 
programme will proceed in 2021.

Early in the year the Board was particularly keen to understand the 
impact of the pandemic on its workforce and ensure staff wellbeing 
was protected first and foremost, whilst maintaining a continuity 
of service to clients. Employees were asked to complete a COVID-19 
related survey which covered a number of areas including the move 
to remote working and the outcome of the survey was presented to 
the Board. This was an important initiative on our engagement 
journey and staff were strongly urged to take part. The COVID-19 
survey received an extremely high staff participation rate and 
responses indicated that staff found greater levels of working 
flexibility to be beneficial. As a consequence participants in the 
Workforce Engagement Programme were invited to be involved in 
the development of an Agile Working policy to help evolve our 
working practices and retain and attract top talent. This new policy 
is expected to be rolled out in H1 2021. 

Communication with our colleagues during this difficult year was 
particularly important and a weekly CEO update was introduced, 
initially in written format but as the lockdown progressed, we 
changed to a more personal video format, which resonated well 
with staff. It kept all employees advised of the safety measures 
being implemented across all our offices and the numerous other 
adjustments that we introduced to protect staff and ensure business 
continuity, whilst complying with local legislation and guidance. 
We also set up a dedicated COVID-19 web page where all of the 
advice could be found. 

Annual Report and Accounts 2020
73

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Other forms of engagement with employees during the year included 
the Group-wide diversity and inclusion survey providing insight into 
employee sentiment and engagement levels, monitoring progress 
on conduct and culture initiatives and providing feedback that 
would define action plans relevant to our business in order to drive 
positive change. 

The outcomes of these engagements provided a cultural barometer 
and feedback on employees’ views and concerns and were reported 
to the Board, as was a Whistleblowing report highlighting notified 
areas of concern.

In the UK there is also an employee representation forum, chaired 
by the CEO, EMEA region, and made up of elected individuals. This 
provides an opportunity for employees to engage with members of 
the executive team on various issues. Social media is monitored for 
employee feedback which is shared with the Executive Directors 
who in turn share this with the Board as part of their Board reports 
or presentations.

Impact on Board decisions
Feedback and insights from the Workforce Engagement 
Programme and other engagement mechanisms were discussed 
in Board and Board Committee meetings. Some of the matters 
considered as part of the Board’s decision making included the 
effectiveness of changes to working practices for both employees 
and clients, progress on conduct and culture initiatives, progress 
against diversity and inclusion targets, the introduction of broker 
equity plans, employee share schemes and other employee 
compensation considerations. 

The feedback from the COVID-19 engagement survey also helped 
to inform return to work plans following the first lockdown and 
provided the Board with invaluable insight into the best ways to 
support staff throughout the pandemic. 

A number of initiatives were agreed for implementation following 
the results of the diversity and inclusion survey, including the 
establishment of the TP ICAP Mentoring Programme, which was 
launched in November 2020.

The Board will continue to monitor the effectiveness of the 
Workforce Engagement Programme, as well as other informal and 
structured employee engagement across the Group during the 
coming year to review our progress, improve oversight and ensure 
employees’ views are integrated into the work of the Board and the 
strategy of the business, while supporting our people’s well-being. 

Workforce engagement in the UK – How it will work in 2021

1.  Board appointed Mark Hemsley to 
lead EMEA employee engagement

5.  Reports discussed at two Board 
meetings each year including 
feedback and next steps

2.  Invitations to be issued to all 

6.  Agree feedback and actions 

employees (including agency workers 
and contractors at identified 
office sites)

communicated to employees by 
regional CEO

3.  Meetings to be held with employee 

7.  Further meetings added to the 

participants

4.  Output from the previous direct 
engagement and employee 
 engagement survey  to be used to 
stimulate discussions at the 
engagement sessions

programme to extend reach to  more 
locations

8.  Board review of employee 

engagement approach to monitor 
progress and consider improvements

 
 
 
 
 
 
 
Corporate governance report 
continued

How we engage – our other key stakeholders

Shareholders

Clients

How we engage
Our relationships and engagement with our clients are 
fundamental to the success of the business. Regular and effective 
dialogue with our clients enables the Board to understand client’s 
needs and how satisfied they are with us as a supplier and 
business partner.

The Board is updated regularly on client engagement by the Chief 
Executive Officer as part of his Board presentation. The Client 
Relationship Management (‘CRM’) team provide holistic coverage 
of the Company’s most important clients, both at strategic and 
tactical levels, to broaden and institutionalise relationships and 
identify opportunities for TP ICAP to more comprehensively serve 
our clients. The Head of CRM presented to the Board during the 
year and CRM reports are periodically included in the Board 
agenda. Client feedback and demands are also communicated to 
the Board throughout the year through the business CEOs as part 
of their presentations to the Board.

During the year the Chief Executive Officer attended meetings 
with major clients engaging on the most important drivers of our 
clients’ business and provided feedback to the Board on these 
meetings. He also met with clients to discuss strategy and focus 
on how to increase connectivity to various TP ICAP platforms. 

Impact on Board decisions 
Throughout the year the Board has been considering the output 
from this engagement and its potential implications for the 
Company’s strategy. This year a particular focus was ensuring 
continuous provision of brokerage services and liquidity to clients 
during the COVID-19 pandemic and a case study on this is set 
out on page 72. The client impact of Brexit was also a key 
consideration for the Board in developing and implementing our 
own Brexit plans. 

Having an understanding of the impact of external economic 
factors on our clients has enabled the Board to readjust its 
immediate strategy and provide effective oversight of operational 
performance. In addition, dialogue with clients has helped the 
Board to stay informed about clients’ concerns, understand 
significant changes in their business, predict future trends and 
re-align strategy accordingly. 

How we engage 
The Chief Executive Officer, Chief Financial Officer and Board 
Chair hold frequent meetings with investors, which in 2020 
included Capital Markets Day, to hear their views on various 
matters. Some of the topics covered in the discussions were the 
Jersey redomicile, the acquisition of Liquidnet and the Company’s 
strategy, the rights issue and other matters of concern to investors 
such as ESG. The Board regularly receives feedback on these 
meetings, along with copies of analysts’ and brokers’ briefings. The 
Chair met with shareholders representing 48% of the shareholder 
register. We also engaged with institutional investors in several 
other ways, including a number of virtual group conference calls to 
accommodate overseas investors. 

All shareholders are invited to attend the Annual General Meeting 
(‘AGM’) and all the Directors normally attend these meetings and 
are available to answer questions. Given the challenges over the 
last year presented by the COVID-19 pandemic, the AGM in 2020 
was a hybrid meeting, facilitating electronic attendance by 
shareholders who, via their computers or electronic devices, were 
able to ask questions of the Board and vote in real-time at the 
meeting. The 2021 AGM will similarly be a hybrid meeting. 

All Non-executive Directors are available to meet shareholders, 
if requested, and the Board is regularly updated on shareholder 
feedback.

There is a regular reporting and announcement schedule to 
ensure that matters of importance are communicated to investors. 
The Annual Report and interim results, together with information 
on the Group’s activities, trading performance, products 
and recent developments are on the Company’s website 
www.tpicap.com/investors. 

Impact on Board decisions
The Board considers shareholders’ interests and views as part of 
their deliberations on an ongoing basis, including in relation to the 
Company’s strategy, dividend payment, and capital and liquidity. 

Engagement with and participation from the Company’s 
shareholders is of key importance to the success of the business 
and in achieving our aim to create long-term and sustainable 
shareholder value. Feedback from investors was a key 
consideration in Board discussions during the year, particularly in 
relation to major corporate transactions including the Liquidnet 
acquisition, corporate reorganisation and redomiciliation and 
executive remuneration Committee discussions. An example case 
study can be found on page 72 regarding the acquisition of 
Liquidnet. The Board has also accelerated its focus on its ESG 
strategy taking into account numerous communications from 
investors on the topic. 

Annual Report and Accounts 2020
74

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Suppliers

Regulators

How we engage
The Board receives periodic updates from the Head of 
Procurement on the status of supplier engagement which includes 
a status update on Corporate Social Responsibility (‘CSR’), ESG 
and modern slavery matters, expenditure information, issues and 
risks and an update on any strategic initiatives in progress. 
During the year, the Board has continued to monitor progress on 
formalising our key strategic supplier management framework. 
The Board has also reviewed purchasing policies which aim to 
minimise the risk of modern slavery in our supply chain and the 
Board reviewed and approved the Modern Slavery Statement, 
which it does annually. In addition, the Board also received regular 
updates on Payment Practices reporting.

Impact on Board decisions
Engagement with our key infrastructure suppliers is important for 
monitoring performance, managing risk and driving value. These 
suppliers provide business critical infrastructure services and 
certain outsourced operations across a wide spectrum of sectors 
including IT, telecommunications, market data and clearing and 
settlements. There has also been a focus on consolidating our 
supplier base to monitor performance, manage risk, influence CSR 
and ESG matters and drive value. The Board was keen to ensure 
that the COVID-19 pandemic did not cause significant additional 
delays to our accounts payable. 

How we engage
As the Group has been lead regulated by the FCA we regularly 
engage with the FCA’s supervisory team but, depending on the 
issues to be discussed, we may meet with the FCA’s policy, 
prudential or competition teams. We also engage with the FCA 
and other regulatory bodies via sector consultation and round 
table exercises.

The Board is kept apprised of discussions with the FCA and 
regulators in other jurisdictions in which we operate through 
Board presentations and regular legal and compliance updates 
presented by the Group General Counsel at the Board meetings. 
The Board was briefed on the views being expressed by 
regulators on how the markets would operate post-Brexit, the 
governance implications of the Jersey redomiciliation and the 
Liquidnet acquisition.

In addition to engagement with regulators, we share our 
experience and expertise through engagement with various trade 
bodies to help raise standards and approaches across the sector. 

Impact on Board decisions
The Board and its Committees take the views of our lead regulator 
into consideration during deliberations on the Group’s risk and 
internal control framework, culture and conduct initiatives, as well 
as in the future design of pay and compensation structures, 
including share plans. Feedback from regulators during the year 
was a key consideration in Board discussions and decisions around 
the corporate reorganisation and redomiciliation, the acquisition 
of Liquidnet, Brexit plans and the response to the COVID-19 
pandemic. Case studies can be found on page 72.

Other stakeholder interests

Community and environment
The Board is cognisant of society’s continuing focus on ESG, especially the environment and climate change, and is committed to striving 
to operate in a sustainable and responsible way whilst delivering value for stakeholders. 

During 2020 the Board increased its focus on the Group’s environmental management approach and changes required to meet best 
practice among the FTSE 350 companies. The Board will be regularly updated on progress against actions or targets set. Our reporting on 
greenhouse gas emissions can be found in the Directors’ report on page 111. This also sets out our environment and climate responsibilities.

The Board was updated on the work that was carried out to support the communities in which the business operates across its global 
locations and further information can be found in the Environmental, Social and Governance report on pages 50 to 60.

Annual Report and Accounts 2020
75

 
 
 
 
 
 
 
Corporate governance report 
continued

Board composition
At the year end the Board comprised ten Directors: three 
Executive Directors, six independent Non-executive Directors and
a Non-executive Chair who was independent on appointment. 
In compliance with the Code, over half the Board was comprised 
of independent Non-executive Directors throughout 2020 and this 
remains the case as at the date of this report with a total of eight 
Non-executive Directors, following the appointments of Tracy 
Clarke and Kath Cates since the year end. 

The Board recognises that a balanced and diverse Board, with 
a broad range of skills, experience and knowledge is more likely 
to be an effective Board. The Directors’ biographies on pages 66 to 
67 and charts on page 77 demonstrate the depth and breadth of 
the Board’s skills, knowledge, experience and competencies. The 
charts on the opposite page reflect the constitution of the Board 
as at 31 December 2020.

Independence of Directors
The Board continually assesses the independence of each of the 
Non-executive Directors and has determined that all the Non-
executive Directors are independent in character and judgement, 
including Angela Knight who has served on the Board for over nine 
years. The Chair was independent on appointment. None of the 
Non-executive Directors has received any remuneration additional 
to their Directors’ fees and the reimbursement of reasonable 
expenses incurred in the course of performing their duties. The 
Board believes that there are no relationships, conflicts of interest 
or other circumstances which are likely to affect, or could appear 
to affect, any Director’s judgement.

Management of conflicts of interests
At the start of each Board meeting, the Directors are invited to 
advise of any conflicts or potential conflicts in respect of any item 
on that meeting’s agenda. 

The Nominations & Governance Committee reviews at each of its 
meetings the Company’s Conflicts and Relevant Situations Register, 
which sets out information on Directors’ conflicts that have either 
been authorised (in accordance with section 175 of the Companies 
Act 2006) or declared (in accordance with section 177 of the 
Companies Act 2006), as well as setting out Directors’ other 
directorships. At any time that the Board considers a Director’s 
appointment, the Board is also invited to consider an extract of the 
Conflicts and Relevant Situations Register for the individual under 
consideration and is asked to authorise conflicts as necessary.

Terms of appointment
The terms of the Directors’ service agreements and letters of 
appointment, which are aligned to the provisions of the Code, are 
summarised in the Report of the Remuneration Committee on page 
108. Each of the Directors is subject to election by shareholders at 
the first AGM after their appointment by the Board and subject to 
annual re-election by shareholders thereafter. The service 
agreements and letters of appointment are available for inspection 
during normal business hours at our registered office, and at the 
AGM from 15 minutes prior to the meeting until its conclusion.

During the year, the Nominations & Governance Committee 
introduced a process for the formal review and renewal of a 
Non-executive Director’s appointment prior to the end of each 
three-year term. As part of the process the Chair conducts an 
interview and assessment to confirm that the Non-executive 
Director continues to contribute effectively and to demonstrate 
commitment to the role. Should the Chair determine that is the 
case, a recommendation is made to the Nominations & Governance 
Committee to extend the appointment for another three-year term. 
In line with best practice governance, a proposal for a third 
three-year term will be subject to more rigorous scrutiny before 
making a recommendation. During the year, the Nominations & 
Governance Committee considered and supported second 
three-year terms for each of Edmund Ng and Michael Heaney.

External appointments
The Directors’ other directorships are set out in the biographies 
on pages 66 to 67. The Board continually monitors external 
appointments to ensure that all Directors are able to allocate 
sufficient time to the Company to discharge their responsibilities 
effectively. The Board allows Executive Directors to take up 
appointments with other companies provided the time involved 
is not too onerous and would not conflict with their duties at 
TP ICAP. None of the Executive Directors currently holds any 
external appointments.

Annual Report and Accounts 2020
76

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Keeping the Board informed 
The Board and its Committees are provided with appropriate and 
timely information. For scheduled meetings, agendas are drafted 
based on the previously agreed forward agenda schedule and are 
then reviewed to replace or include supplemental items to reflect 
current business priorities as determined by the Chief Executive 
Officer and the Executive Directors. Additionally, the Chair of the 
Board or the Chairs of each of the Committees have sessions, 
in person, by telephone or exchange of email, with the Group 
Company Secretary or relevant function heads to review the 
agendas for scheduled meetings. 

Wherever possible agenda items for consideration are 
accompanied by written reports and supporting papers. Oral 
updates are permitted where matters are progressing at a pace to 
ensure the Directors have the most current information available. 
Board and Committee papers are circulated sufficiently in advance 
of meetings to enable Directors to review them. 

The Group has a comprehensive system for financial reporting 
on the Group’s financial position and prospects, which is subject 
to rigorous review by both internal and external audit. Budgets, 
regular forecasts and monthly management accounts including 
KPIs, income statements, balance sheets and cash flows are 
prepared and the Board reviews consolidated reports of these.

The Group Company Secretary and Group General Counsel are 
responsible for ensuring the Board stays up to date with key 
changes in legislation which may affect the Company. There 
are also procedures in place for the Board to take independent 
professional advice at the Company’s expense, should the 
need arise.

The Board continually monitors the quality of the information it 
receives to ensure it is clear, comprehensive and helps the Board 
to carry out its duties. 

Composition of the Board as at 31 December 2020

Gender

Male
Female

Nationality 

British
French

American

Canadian

Skills 

Tenure 

Banking
Corporate Transactions
Risk
Regulatory
Strategy
Corporate Governance
Broking
Remuneration

Audit
Operational
Accounting
Technology

0-3 years
6+ years
3-6 years

8
2

7
1

1

1

9
9
9
8
7
6
6
5

5
5
4
2

7
2
1

Annual Report and Accounts 2020
77

 
 
 
 
 
 
 
Corporate governance report 
continued

Board training and development
All Directors receive a comprehensive induction on joining the 
Board. Further details on the general process for the induction of 
new Directors is set out in the Nominations & Governance 
Committee Report on page 82.

The Chair has overall responsibility for ensuring Directors 
continually update their skills and knowledge, and familiarity with 
the Company, so as to fulfil their role. Each of the Directors is, 
however, also personally responsible for ensuring that any specialist 
skills and competencies they have remain current. The Board and its 
main Committees receive briefings from relevant function heads on 
any relevant current developments as part of the normal Board 
reporting process. 

A schedule of formal training provided to the Board and its 
Committees is maintained. During 2020 the Board and Committees 
had almost eight hours of formal training on a wide range of topics, 
despite the challenges presented by COVID-19 and the consequential 
reprioritisation of the Board’s agenda. The subjects included deep 
dives on capital strategy and usage, ICAAPs overview and 
methodology, franchise risk and the Investment Firms Directive. 
The Board also received training on crisis and cyber training as well 
as Jersey versus English law in preparation for the redomiciliation. 
In addition to this formal training there were regular briefing 
sessions at Board meetings throughout the year on the UK’s exit 
from the European Union, implications for financial services and 
the Company’s consequential plans.

The Board is also kept informed of any material shareholder 
correspondence, broker reports on the Company and sector, 
institutional voting agency recommendations and documents 
reflecting current shareholder thinking. In addition, members of 
the GMC make regular presentations to the Board on a wider 
range of topics.

The Non-executive Directors are encouraged to take advantage of 
external conferences, seminars and training events, and sign up to 
receive briefings issued by professional advisers on legislative, 
regulatory and best practice guidance and updates. They are also 
encouraged to meet members of the management teams both in 
the UK and overseas to enhance both their knowledge and 
understanding of the Group’s core business areas. Such direct 
engagement with staff also helps embed the Non-executive 
Directors’ role as workforce engagement champions and enables 
them to observe first-hand the controls, culture and conduct 
behaviours in operation. 2020 presented clear challenges, given 
COVID-19 restrictions, to engage on a face to face basis but where 
possible this was conducted virtually.

Annual Report and Accounts 2020
78

Board evaluation
The Board undertakes an external evaluation every three years, the most recent external evaluation having taken place last year. The 2020 
Board and Committees evaluation process was therefore internally facilitated and is illustrated in the following diagram:

2.
In December 2020 the 
questionnaire was 
circulated to all 
Directors for completion 
and returned to Group 
Company Secretariat for 
collation. A report with 
unattributed scoring and 
comments was prepared. 

3.
Once completed, the 
Report’s findings and 
proposed actions were 
initially discussed 
with the Board Chair 
and presented to the 
Board also on a 
non-attributable basis. 
The Report was 
discussed at the January 
2021 Board meeting 
and 2021 action plans 
were agreed.

4.
Each Board Committee 
will consider evaluation 
outcomes relevant to 
the Committee at 
meetings in March and 
May 2021. 

1.
The Board agreed to 
carry out an internally 
facilitated 
questionnaire based 
Board and Committee 
evaluation. The 
questionnaire was 
designed by Group 
Company Secretariat, 
taking into account the 
FRC’s guidance on 
Board Effectiveness, 
with input from the 
Chairs of the Board and 
Committees. The 
questionnaire included 
both qualitative and 
quantitative questions.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Progress against 2020 actions 
The outcome of the 2019 Board evaluation exercise, which was externally facilitated, was reported in detail in last year’s Annual Report. 
The main action points arising from that exercise, and actions taken in respect of each, are set out in the table below. 

2019 evaluation recommendations
Enhance the Board’s 
engagement on the Group’s 
culture and behaviours

Monitor and evaluate 
progress in implementing 
the Group’s strategy
Enhance the Board’s 
composition, dynamics and 
processes

Progress made during the year
 > The Board maintained a strong focus on workforce culture and behaviours throughout the year 

despite the challenges posed by the COVID-19 pandemic. Some examples include the introduction 
of a broker equity scheme, maintaining focus on the embedding of the Group’s Enterprise Risk 
Management Framework and the holding of regional town halls and employee engagement 
sessions earlier and at the end of the year (though these were curtailed by the pandemic).

 > ESG and CSR became a regular agenda item for the Board.
 > The Board approved the establishment of a Strategy Execution Committee to assist with monitoring 

and evaluating progress on strategic implementation.

 > Since the publication of the last Annual Report, four Directors were appointed to the Board with 
invaluable, broad-ranging skillsets as set out in the Director biographies on pages 66 to 67. This 
year’s Board evaluation indicated that the appointments had a positive effect on the composition 
and dynamics of the Board, though it was also recognised that new Directors would require to be 
brought up to speed quickly with specific knowledge of TP ICAP in light of the relatively short overall 
tenure of the Board as a whole.

Annual Report and Accounts 2020
79

 
 
 
 
 
 
 
Corporate governance report 
continued

Actions agreed for 2021
The 2020 evaluation process highlighted that Board members felt that they worked well together as a unit, the Chair successfully led and 
guided members on the pace, focus and discussions of important topics at meetings. Board members were also considered to be aligned 
on the Company’s purpose, values and wider responsibilities. The main recommendations arising from the Board evaluation for 2020, and 
actions planned during 2021, are set out in the table below.

2020 evaluation recommendations
Strengthen the Group’s ESG 
strategy and appoint an ESG 
representative to facilitate 
its implementation
Ensure new Directors are 
integrated swiftly into Board 
discussions
Continue to improve the 
Non-executive Director 
Employee Engagement 
Programme

Actions to be taken during 2021
 > Appoint a Director as the nominated ESG representative, enhance oversight of environmental 

statistics, consider ESG objectives and maintain regular dialogue with stakeholders on ESG matters. 
The Board approved Tracy Clarke’s appointment as ESG Engagement Director in March 2021. 

 > Adapt Director induction programmes to ensure Directors are brought up to speed quickly on the 

activities of the business. Consider alternative engagement and induction methods where COVID-19 
related restrictions still exist.

 > Continue to improve and monitor the effectiveness of the Non-executive Director Employee 

Engagement Programme to ensure continuity despite the current challenges presented by COVID-19.

Specific developments and actions to be taken during 2021 by each of the Board Committees will be considered at future meetings 
of the Committees.

Individual performance evaluation
As a separate part of the annual evaluation process, there is a review of the effectiveness and commitment of individual Directors and the 
need for any training or development is assessed. This is carried out as follows:

 > The Chair meets with the Non-executive Directors to evaluate the performance of the Chief Executive Officer; 
 > The Chair meets each Non-executive Director individually; and 
 > The Senior Independent Director and the other Non-executive Directors meet to evaluate the Chair’s performance, having first obtained 

feedback from the Chief Executive Officer.

As part of the annual evaluation, an individual’s commitment of time to the Company in light of their other commitments, as noted in their 
biographies on pages 66 to 67, is reviewed. In addition the Chair will conduct an interview and assessment of Non-executive Directors as 
he or she approaches the end of each three-year term to determine their contribution and commitment to the role. Further information on 
this is on page 83.

All Directors subject to the annual evaluation were deemed to be effective members of the Board and are recommended for re-election at 
the AGM, except Angela Knight and Roger Perkin who will not be seeking re-election. 

Annual Report and Accounts 2020
80

Report of the Nominations & Governance Committee

Richard Berliand 
Chair, Nominations  
& Governance Committee

Committee members
Richard Berliand
Angela Crawford-Ingle2
Michael Heaney
Mark Hemsley3
Angela Knight
Edmund Ng
Roger Perkin
Lorraine Trainer4

Meetings
attended1
5/5
3/3
5/5
3/3
5/5
5/5
5/5
2/2

1 

In addition to the scheduled meetings, four further meetings were held at short 
notice to consider Board composition, Non-executive Director recruitment and 
the appointment of independent Non-executive Directors to the UK Regulated 
Entities. All members were able to attend the additional meetings.

2  Angela Crawford-Ingle attended all meetings upon joining the Committee on 

16 March 2020. 

3  Mark Hemsley attended all meetings upon joining the Committee on 

16 March 2020. 

4  Lorraine Trainer stepped down as a member of the Committee with effect 

from 13 May 2020. 

How the Committee spent its time during  
the year in scheduled meetings  
%

Governance
Board member recruitment 
including skills, experience and 
diversity review
Executive Director and senior 
management succession planning
Routine matters
UK regulated entities 
– Board oversight matters
Policies and Controls
Stakeholder engagement

29%
21%

19%

11%
10%

7%
3%

More online
The Committee’s terms of reference are available  
on the Company’s website: 
tpicap.com/investors

Annual Report and Accounts 2020
81

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Dear fellow shareholder,

I am delighted to present the Nominations & Governance 
Committee Report which summarises how the Committee has 
discharged its responsibilities during the year. Areas of focus this 
year included Board recruitment, composition and succession 
planning, Board and workforce diversity, senior management 
succession planning, ESG and Governance matters including the 
Group Governance Manual. 

Board composition, recruitment and succession planning 
One of the agreed actions following last year’s Board and 
Committee evaluation was to review the composition of the Board 
and Committees, taking into consideration Board members’ skills, 
experience and knowledge, as well as diversity aspirations, 
recognising that this needed to keep pace with the execution of the 
Group’s strategy. The Committee made good progress in this area 
with the appointments of Mark Hemsley and Angela Crawford-
Ingle in March 2020 and Tracy Clarke and Kath Cates more recently 
in January and February 2021, respectively. An important focus of 
the search and recruitment process was the Committee’s diversity 
aspirations as well as the Company’s strategic priorities.
The skills, experience and external appointments of the new 
Directors can be found on pages 66 to 67. The Board is already 
benefiting from Mark’s and Angela’s considerable experience and 
contributions to Board discussions. Kath and Tracy bring strong 
relevant experience and expertise to the Board which will prove 
invaluable to their roles as Chair of the Risk Committee and Chair 
of the Remuneration Committee, respectively.

The recruitment process for each appointment was carried out with 
the support of an independent search consultancy firm, Russell 
Reynolds, with no connection to the Company or to individual 
Directors, who were asked to compile a diverse long and short list of 
candidates with specific skills and expertise to fill the gaps left by 
departing Board members. During the recruitment process, 
candidate specifications (including expected time commitment, 
skills and expertise) were agreed and used by Russell Reynolds to 
identify potential external candidates in the market based on 
objective criteria with due regard to the Board’s diversity goals. The 
potential candidates’ profiles were mapped with the Board Skills 
Matrix, which is regularly reviewed by the Committee, to ensure the 
skills and expertise that are considered important to achieving the 
organisation’s strategic priorities are covered. Members of the 
Committee met individually with the shortlisted candidates and 
all the Board members met with the preferred candidates. 

Whilst every effort is made to ensure appropriate succession plans 
are in place in the medium and long term, on occasion the 
Committee has to consider unanticipated near-term succession 
plans. Lorraine Trainer decided in March 2020 not to seek re-
election at the 2020 Annual General Meeting and consequently 
stepped down from the Board on 13 May 2020. In light of Lorraine’s 
departure, Angela Knight, who had been due to step down from the 
Board, agreed to remain on the Board for the near-term and 
assume the Chair of the Remuneration Committee as well as 
continue as the Company’s Senior Independent Director. This not 
only gave the Board the opportunity to continue to benefit from her 
considerable knowledge and experience, but also gave the 
Nominations & Governance Committee time to conduct a thorough 
and extensive search for a permanent Chair of the Remuneration 
Committee alongside the search for a permanent Chair of the Risk 
Committee, which was already in train. 

 
 
 
 
 
 
 
Report of the Nominations & Governance Committee 
continued

Key responsibilities of the Committee
The Board has delegated responsibility to the Committee for: 

Board and Committee membership, and succession planning
 > reviewing the balance, skill, knowledge and experience of the 
Board and Board Committees; making recommendations to 
the Board as to necessary and appropriate adjustments in 
structure, size and composition;

 > overseeing succession planning processes for the Board and 

senior management;

 > making recommendations to the Board on all proposed 

new appointments, elections and re-elections of Directors 
at AGMs;

Board performance
 > supervising the Board performance evaluation process; 

overseeing any remedial action required as a result of the 
Board performance evaluation process concerning the 
composition of the Board;

Director independence
 > assessing and making recommendations to the Board in 
relation to the independence of Non-executive Directors;

Conflicts and related person transactions
 > reviewing conflicts; 

Governance
 > considering various governance matters, including compliance 

with the UK Corporate Governance Code, the UK Senior 
Managers and Certification Regime and/or other relevant 
regulatory regimes; 

 > reviewing key non-pay related workforce policies and 

stakeholder engagement mechanisms;

Social and environmental matters 
 > reviewing and approving the content of any social and 

environmental related statements or policies; 

Conduct
 > reviewing and approving the Company’s Code of Conduct, 

share dealing code and related policies; 

UK regulated entities (‘UKREs’)
 > agreeing procedures for the selection of and making 

recommendations to the UKRE boards on new appointments 
of independent Non-executive Directors and considering the 
succession planning process for the UKRE boards; and

 > reviewing the balance, skills, knowledge and experience, time 
commitment, independence and diversity of the UKRE boards, 
and making recommendations as required.

Annual Report and Accounts 2020
82

The Committee recognises that Angela Knight has served on the 
Board for more than nine years, but is confident that she remained 
independent in character and judgement during the year. Angela 
and Roger Perkin will step down from the Board from the conclusion 
of the 2021 Annual General Meeting and will be succeeded by 
Michael Heaney and Angela Crawford-Ingle as Senior Independent 
Director and Audit Committee Chair, respectively.

In addition to Board succession planning, the Committee also 
considered executive and senior management succession planning. 
Details of the senior management talent pools were presented to 
the Committee during the year and it is pleasing to report that 
there was an increase in female senior managers during the year. 
More details can be found on page 53.

Diversity
Diversity of the membership of the Board, UK Regulated Entities 
and wider workforce is regularly considered by the Committee to 
ensure progress against the diversity targets set out in the Parker 
Review, Hampton-Alexander guidelines and the Women in Finance 
Charter. In the Committee’s consideration of diversity, we look at it 
in its broadest sense, not just in respect of gender, but also age, 
experience, ethnicity and geographical expertise.

I am pleased to report that at the date of this report we have met 
the requirements of the Parker Review and Hampton-Alexander 
guidelines and that three of the four most recent Board 
appointments were women. When Angela Knight and Roger Perkin 
step down from the Board in May 2021 the composition of the 
Board will reduce to 30% female representation. The Board is 
committed to continuing to comply with Hampton-Alexander and 
therefore intends to begin the search for a female Non-executive 
Director with a view to the Board once again comprising at least 
33% women by the end of 2021 and going forward.

Additionally, we are proud to have exceeded our Women in Finance 
targets to achieve 25% senior women in the business by the year 
2025: as of September 2020 female representation in senior 
management was 31%. Further details of our diversity and inclusion 
commitments can be found on our website at www.tpicap.com and 
on pages 52 and 53 of this report.

Induction
The induction process for all newly appointed Directors includes the 
appointee receiving a comprehensive induction programme and 
briefing with external legal advisers on Directors’ duties, roles and 
liabilities, either prior or soon after appointment. Access is provided 
to the Board and Committee packs (including minutes and papers) 
from previous Board cycles and one-to-one induction meetings are 
held with Executive Directors and senior management, including 
the Group Company Secretary. Company constitutional, 
compliance and governance documentation, as well as information 
relating to the Group and governance structure and the 
expenditure control framework, is also provided. The Committee 
seeks feedback on the induction process from newly appointed 
members of the Board with a view to improving the programme. 

Having appointed four Directors to the Board during the year, the 
Group Company Secretary and Chair have been working with those 
individuals to ensure they are brought up to speed on the activities 
of the business as quickly as possible, recognising the challenges 
presented over the last year because of restrictions of movement 
during the COVID-19 pandemic.

Governance
During 2020 the governance framework for the Group as set out in 
the Group Governance Manual (‘Manual’) was further developed 
with key changes made to the Executive Committee structure. The 
Committee continued to monitor the organisation’s evolving 
governance framework which needed to be reflected in the Manual, 
particularly in light of the Jersey redomiciliation. Subject matter 
experts were consulted in support of this review and ensured the 
governance structure post-redomiciliation is in line with regulatory 
requirements. Details of the governance framework can be found 
on page 69.

Additional areas of focus for the Committee have included an 
internal assessment of the Company’s compliance with the changes 
to the UK Corporate Governance Code, a review of the UK 
Regulated Entity governance framework, the composition, skills 
and experience of the UK Regulated Entity boards and oversight 
of the setup of the Strategic Execution Committee. In addition the 
Committee has conducted a review of the effectiveness and 
independence of the Non-executive Directors who have completed 
their first three-year term.

The regulated entities’ governance
During 2020 the Committee made recommendations on the 
appointments of independent Non-executive Directors to the Group’s 
UK regulated entity boards. As part of its consideration, the 
Committee takes into account the balance of independence, skills, 
experience and diversity on the boards. In relation to the latter, the 
Committee is committed to ensuring there is appropriate female 
representation on the UK regulated entity boards. 

Stonehaven, an independent search consultancy with no other 
connection to the Company, has assisted the Committee and Executive 
Directors in the formal search for UK regulated entity independent 
Non-executive Directors. As a part of the recruitment process members 
of the Committee met with the shortlisted candidates. 

Stakeholder engagement
The Committee has considered engagement with a number of key 
stakeholders during the year, including discussions of key topics 
raised by shareholders and monitoring progress of the Workforce 
Engagement Programme including output actions. The 
effectiveness of the Board’s stakeholder engagement was also 
considered as part of the Board’s most recent evaluation. 

Other areas of the Committee’s focus

Social and environmental matters
The 2020 review of the Charitable Giving and CSR Policies. 
Discussions on the Group’s Corporate Social Responsibility Strategy, 
Climate Change and Environmental Sustainability for 2021 were 
undertaken by the Committee with the Board members present.

Conduct
The Group’s Code of Conduct, underlining expectations of high 
ethical standards and integrity in all aspects of the Group’s 
operations and business, was an area of discussion and review by 
the Committee prior to its revision and approval in March 2021. 
The meeting also discussed how this would be embedded and 
upheld throughout the Group.

Board performance
During 2020 the Committee oversaw the Board evaluation process, 
including discussion on the process and timings for the internally 
facilitated Board evaluation to be completed at the end of 2020. 
Further details on the Board evaluation process can be found on 
pages 79 and 80.

Annual Report and Accounts 2020
83

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Director independence, conflicts and related person 
transactions
Director independence was assessed as part of the formal review 
of the Non-executive Directors who had completed their initial 
three-year term during the year. 

The Board’s reported potential conflicts and relevant situations 
were reviewed at every Committee meeting. Related party 
transactions were considered as situations arose. Further details on 
Director independence can be found on page 76. 

Ahead of making any appointment decision, consideration is given 
to whether, in the Company’s view, the proposed Director would 
have sufficient time to fulfil his or her Board responsibilities given 
their other appointments. 

Committee effectiveness
Since the external review of effectiveness conducted in January 
2020, the Committee has progressed areas identified for 
improvement. During the year the Committee made real progress 
on Board refreshment, with four Non-executive Directors appointed 
in the last 12 months. The Committee also monitored succession 
planning and diversity of the senior management talent pools. 
The Committee was pleased to see major progress with regard to 
diversity with a significant year-on-year increase of female senior 
managers within the organisation. 

An internal review of the Committee’s effectiveness was conducted 
in December 2020 to January 2021 which determined that the 
Committee was operating well in most areas. Specific 
developments and actions to be taken by the Committee during 
2021 will be considered at a future meeting.

Election and re-election of Directors 
The Committee takes into account the results of the evaluations of 
individual Directors (see page 80 for further information) to assist 
in determining whether to recommend to the Board the election or 
re-election of Directors at every AGM, as required in accordance 
with the Company’s Articles of Association. The Committee has 
considered the mix of skills, knowledge, experience, competencies 
and background of the members of the Board. The Board considers 
that it exhibits gender and cultural diversity, and the range of skills 
and backgrounds encompasses financial, commercial, operating, 
control, corporate governance, accounting, regulatory, audit, 
political and international attributes.

All Non-executive Directors have submitted themselves for election 
at the 2021 AGM with the exception of Angela Knight and Roger 
Perkin. The Committee is pleased to recommend all Directors 
putting themselves forward for election. 

Following completion of a three-year term, the Committee carried 
out a formal review of Edmund Ng and Michael Heaney’s 
appointments and it was determined that they both continued to 
contribute effectively and demonstrate commitment to their roles 
as Non-executive Directors and were recommended for a second 
three-year term by the Committee. The biographies of the Directors 
standing for election can be found on pages 66 to 67 with further 
detail accompanying the Notice of the AGM and also on the 
Company’s website: www.tpicap.com.

Richard Berliand
Chair
Nominations & Governance Committee 
9 March 2021

 
 
 
 
 
 
 
Report of the Audit Committee

Roger Perkin
Chair, Audit Committee 

Committee members
Roger Perkin 
Angela Knight
Lorraine Trainer1
Angela Crawford-Ingle2

Meetings
attended
5/5
5/5
1/1
4/4

1  Lorraine Trainer attended all meetings prior to stepping down from the 

Committee on 13 May 2020.

2  Angela Crawford-Ingle attended all meetings upon joining the Committee 

on 16 March 2020.

How the Committee spent its time during  
the year in scheduled meetings  
%

Annual/interim reporting and 
trading statement review 
External Auditor Reporting
Internal Auditor Reporting
Risk management and 
internal controls
Governance
Routine matters
Tax matters

32%

23%
22%
12%

6%
4%
2%

Dear fellow shareholder,

I am pleased to present the Committee report for the year ending 
31 December 2020 which sets out how the Committee has discharged 
its responsibilities during the year and explains how the Committee 
ensured the integrity of financial reporting. The report also 
highlights the Committee’s assessment of significant financial 
reporting judgements in connection with the 2020 financial 
statements, and the conclusions reached. A summary of the 
Committee’s responsibilities is set out below.

All Committee members are independent Non-executive Directors 
with experience in the financial services sector and both myself and 
Angela Crawford-Ingle, as qualified accountants, fulfil the UK 
Corporate Governance Code (the ‘Code’) requirement of having 
recent and relevant financial experience. As Committee Chair 
Designate, Angela will be appointed Chair of the Committee upon 
my retirement from the Board at the conclusion of the 2021 AGM. 
We also welcomed Kath Cates as a member of the Committee 
effective from her appointment to the Board on 1 February 2021. 
The Committee believes that it has complied with the Audit 
Committee composition requirements in the Code.

Key responsibilities of the Committee
The Board has delegated responsibility to the Committee for:

Financial reporting 
 > considering significant financial reporting judgements;
 > reviewing the Annual Report and Financial Statements and 

half-year results;

 > considering Group tax matters;
 > considering whether the financial statements taken 
as a whole, is fair, balanced and understandable;
 > monitoring compliance with accounting standards;
 > reviewing the going concern and the longer-term 

viability statement;

External audit
 > reviewing the effectiveness of external audit;
 > assessing external auditor independence;
 > developing a policy for non-audit services provided by the 

external auditor;

Risk management and internal control
 > considering the effectiveness of the Group’s systems 

of risk management and internal control, including all 
material controls;

 > reviewing whistleblowing arrangements;

Internal audit
 > approving the internal audit’s risk assessment, internal audit 

charter and annual audit plan;

 > considering the results and findings of internal audit’s work;
 > reviewing the effectiveness of internal audit; and
 > reviewing whistleblowing arrangements.

More online
The Committee’s terms of reference are available  
on the Company’s website: 
tpicap.com/investors

Annual Report and Accounts 2020
84

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Following the Committee’s review of the 2020 Annual Report, the 
Committee made a recommendation to the Board that, taken as a 
whole, the Annual Report is fair, balanced and understandable and 
provides the information necessary for shareholders to assess the 
Company’s position and performance, business model and strategy. 
The ‘fair, balanced and understandable’ recommendation to the 
Board, is explained on page 86.

I provide regular reports to the Board on the activities of the 
Committee and how we have discharged our duties. To ensure I 
have a full understanding of the challenges facing the Group I 
communicate regularly with the risk and finance functions, as well 
as with external and internal audit, both in the UK and our principal 
overseas locations.

Financial reporting
The Committee has reviewed the integrity of the Consolidated Financial Statements included in the half-year and year end announcements 
of results and the Group’s Annual Report and Accounts. The Committee also reviewed the integrity of the Consolidated Financial Statements 
included in the Prospectuses published on 7 January 2021. 

Significant financial reporting judgements in 2020
We considered a number of judgements in connection with the 2020 Consolidated Financial Statements. These judgements, how the 
Committee addressed them and the conclusions we reached, are set out below:

Judgement
Impairment of goodwill and 
other intangibles

Note
13

Action the Committee took
 > Reviewed the basis on which goodwill 
was allocated to CGUs and discussed 
management’s annual impairment 
assessment.

 > Considered the basis for determining the 

recoverable amount of each CGU.
 > Challenged the methodology and 

valuation assumptions used.

 > Considered whether the information 

provided to the Group’s external valuation 
specialists was complete and accurate.
 > Reviewed the carrying amounts of other 

intangible assets and

 > discussed management’s annual review 

of impairment triggers.

The Group’s assessment and 
disclosure of legal cases and 
regulatory investigations

26 and 35

 > Reviewed the cases identified and 

discussed management’s provisioning and 
disclosure assessment. 

 > Considered the basis for determining 

provisions in respect of cases. 

 > Considered whether the information 
disclosed was consistent with the 
information maintained by the Group 
Legal Counsel and the Group’s external 
legal advisors.

 > Reviewed the procedures performed by 
the external auditor, including their 
inquiries performed of the Group’s external 
legal advisors. 

Continued over the page.

Conclusions
 > The Committee is satisfied with the 

process undertaken, that an 
impairment charge of £21m is 
required in the year to the Asia 
Pacific CGU and that the disclosures 
are appropriate.

 > The Committee is satisfied with the 
process undertaken and that the 
provisions and contingent liability 
disclosures are appropriate. 

Annual Report and Accounts 2020
85

 
 
 
 
 
 
 
Report of the Audit Committee 
continued

Judgement
The use, presentation and 
explanation of Alternative 
Performance Measures used 
by management to explain 
the Group’s performance.

Note
Financial 
Review and 
Note 4

Conclusions
 > The Committee is satisfied that the 

definition and presentation, 
reconciliation and explanations of 
APMs were appropriate and that 
the disclosure relating to adjusted 
performance and significant items 
are appropriate.

Action the Committee took
 > Challenged management on the rationale 
for each Alternative Performance Measure 
used to describe the Group’s performance 
and the justification for separate 
presentation of significant items from the 
Group’s adjusted results.

 > Reviewed the adequacy of the disclosure of 
Alternative Performance Measures used to 
review Executive performance.

 > Challenged and reviewed the adequacy of 
managements disclosure and description 
of significant items to ensure sufficient 
clarity and justification provided in the 
Annual Report.

 > Reviewed the Annual Report to ensure that 

undue prominence was not given to 
Alternative Performance Measures in line 
with guidance from the European Securities 
and Markets Authority.

 > Reviewed the adequacy and completeness 

of reconciliations of Alternative 
Performance Measures to the nearest 
equivalent Reported measure

 > Sought the view of the external auditor and 

reviewed its procedures as set out in 
its report.

Other items that were less significant but were discussed included: 
the application of IAS 19 as regards holiday pay accruals at interim 
reporting dates; the application of IFRS9 Expected Credit Losses; 
the Group’s reporting of its acquisitions and related remeasurement 
of outstanding consideration as disclosed in Note 32.

Fair, balanced and understandable 
Before the 2020 Annual Report was approved, the Committee was 
asked to review and consider the processes and controls in place to 
help ensure it presents a fair, balanced and understandable view of 
the business. When conducting these reviews, the Committee:

 > examined the preparation and review process;
 > considered the level of challenge provided through that process 

and whether the Committee agreed with the results; and

 > considered the continuing appropriateness of the accounting 
policies, important financial reporting judgements and the 
adequacy and appropriateness of disclosures.

Board members received drafts of the Annual Report for their 
review and input which provided an opportunity to discuss the 
drafts with both management and the external auditor, 
challenging the disclosures where appropriate. 

We concluded that the processes and controls were appropriate, 
and were therefore able to make the following assurance to 
the Board: 

 > in our view, the Annual Report, taken as a whole, is fair, balanced 
and understandable and provides the information necessary for 
shareholders to assess the Group’s position, performance, 
business model and strategy. 

Going concern and viability statement
The assumptions relating to the going concern review and viability 
statement were considered, including the medium-term projections, 
stress tests and mitigation plans.

On the basis of the review, we advised the Board that it was 
appropriate for the Annual Report and Financial Statements to be 
prepared on a going concern basis. We also reviewed the long-term 
viability statement taking into account the Group’s current position 
and principal risks and uncertainties, and advised the Board that 
the viability statement and the three-year period of the assessment 
were appropriate.

Internal audit 
The Committee is responsible for monitoring and reviewing the 
effectiveness of the internal audit function. We approve the internal 
audit plan and keep it under review during the year, to reflect the 
changing business needs and to ensure it considers new and 
emerging risks.

During 2020, the Committee:

 > reviewed the work and reports of internal audit;
 > reviewed how internal audit findings had been implemented; 
 > monitored progress against the internal audit plan during 2020; 

and

 > approved the 2021 Annual Audit Plan.

Annual Report and Accounts 2020
86

During 2020, the internal audit function has continued to build out 
the in-house team, including implementing revised methodologies 
and hiring of staff. During the year Mark Pointer was appointed as 
Chief Internal Auditor as part of our succession planning. We also 
appointed a new co-source provider, EY, to provide specialist skills 
to supplement the in-house team. The Committee considered the 
resourcing and skills of internal audit and is satisfied that it has 
appropriate resources and remains independent. At the beginning 
of 2021 we appointed PwC to complete an external assessment of 
the internal audit function, with the results of the review to be 
presented to the Committee in early 2021.

External auditor 
Effectiveness 
I meet regularly with the external audit partner throughout the year 
to ensure that there are no unresolved issues of concern. This helps 
ensure that the external auditor is able to operate effectively and 
challenge management sufficiently when required.

During the year as part of the 2020 effectiveness review of both the 
external auditor and the 2020 audit, the Committee considered:

 > the quality of Deloitte’s 2020 external audit;
 > the effectiveness of the external audit process including the 

expertise, efficiency, global service delivery and cost 
effectiveness of the auditor;

 > the external auditor’s plans and feedback from senior 

management; and

 > effectiveness of management in relation to the timely 

identification and resolution of areas of accounting judgement, 
analysing those judgements, the quality and timeliness of papers, 
management’s approach to the value of independent audit and 
the booking of any audit adjustments arising, and the timely 
provision of draft public documents for review by the external 
auditor and the Committee. 

The Committee is pleased to report that the effectiveness review of 
the external auditor did not identify any significant concerns.

In addition, the Committee concluded that the 2020 external audit 
had been effective.

Independence and non-audit services
When considering the 2020 Annual Report, the Committee 
reviewed the objectivity and independence of the external auditor. 
We also considered the professional and regulatory guidance on 
auditor independence and Deloitte’s policies and procedures for 
managing independence. 

The non-audit services policy was updated during the year and 
reviewed by the Audit Committee to ensure the requirements of the 
Financial Reporting Council’s Revised Ethical Standard (2019) were 
fully covered by the policy. Deloitte confirmed that no non-audit 
services prohibited by the FRC’s Ethical Standard were provided to 
the Group or Parent Company. 

To safeguard the external auditor’s independence and objectivity, 
the Company does not engage Deloitte for any non-audit services 
except where it is work that they must, or are clearly best suited to, 
perform. All proposed services must be pre-approved in accordance 
with the non-audit services policy.

The Committee reviewed the level of fees paid to the external 
auditor for the various non-audit services provided during 2020. 
During the period under review the non-audit services performed by 
the external auditor amounted to £1,599m, 25% compared to the 
£6,327m of audit fees. Non-audit services primarily relate to 
regulatory reporting, the interim review of the Group’s half year 
financial statements, audits of subsidiary financial statements not 
mandated by law and reporting accounting services in respect of 
the proposed acquisition of Liquidnet and incorporation of a new 
Jersey-domiciled Group holding company. These services are 
typically performed by the external auditor. There were no advisory 
or consulting services provided by the external auditor to the Group.

8

7

6

5

4

3

2

1

0

6,141

6,327

1,918

1,599

2019

2020

2019

2020

Audit

Non-audit

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

More information can be found on page 145 in Note 5 to the 
Consolidated Financial Statements 

External Audit
Deloitte has been the Company’s auditor since its predecessor 
company listed in 2000. In 2013, the Board put the external audit 
contract out for tender and concluded that Deloitte should be 
re-appointed. 

During the year, Fiona Walker replaced Alan Chaudhuri as lead 
audit partner for the year ended 31 December 2020.

In accordance with prevailing corporate governance requirements, 
the audit contract will be put out to tender at the latest in 2023 in 
respect of the year ending 31 December 2024. This would allow a 
four-year term for the new lead audit partner. The Committee will 
continue to monitor legal requirements and developments in best 
practice with regard to audit tender arrangements. 

The Committee is very aware of the developments relating to the 
external audit process driven by various reviews and welcomes 
moves to ensure the continuing robustness, challenge and 
independence provided that they genuinely address acknowledged 
quality issues. We have alerted other major audit firms to the audit 
tender process referred to above with a view to ensuring that, 
at that time, we will be able to choose from the widest possible 
selection of appropriately skilled and independent firms, with the 
geographical reach to audit us globally.

The Company confirms its compliance with the requirements of the 
Statutory Audit Services for Large Companies Market Investigation 
(Mandatory Use of Competitive Tender Processes and Audit 
Committee Responsibilities) Order 2014 throughout the year ended 
31 December 2020.

Annual Report and Accounts 2020
87

 
 
 
 
 
 
 
Committee effectiveness
An internal review of the Committee’s effectiveness was conducted 
in December 2020 to January 2021 which determined that the 
Committee was operating well in most areas. Specific 
developments and actions to be taken by the Committee during 
2021 will be considered at a future meeting. During the year the 
Committee also conducted a review of its Terms of Reference.

Roger Perkin
Chair
Audit Committee 
9 March 2021

Report of the Audit Committee 
continued

Risk management and internal control
The Board is responsible for:

 > setting the Group’s risk appetite;
 > ensuring the Group has an appropriate and effective Enterprise 

Risk Management Framework (‘ERMF’); and

 > monitoring the ongoing process for identifying, evaluating, 

managing and reporting the significant risks faced by the Group.

The ERMF and principal risks are described in the Risk 
Management section of the Strategic Report on pages 44 to 49.

The Board is also responsible for the Group’s system of internal 
control and for reviewing its effectiveness. The system is designed 
to manage rather than eliminate the risk of failure to achieve 
business objectives and can provide only reasonable and not 
absolute assurance against misstatement or loss.

The Committee carried out an annual review of the effectiveness 
of the internal control and risk management systems and reported 
back to the Board to enable it to discharge its responsibilities. 
We conducted a formal review of the effectiveness of the Group’s 
internal control systems for 2020, considering reports from 
management, external audit and the work of the Group Risk and 
Internal Audit functions. As a result of both changes in the business 
and regulatory feedback, the Group has undertaken a complete 
review and enhancement of its global risk management framework 
and ongoing enhancement of internal control. Further details can 
be found in the Report of the Risk Committee on pages 89 to 91.

The process for identifying, evaluating and managing the principal 
risks faced by the Company is reviewed regularly by the Board and 
has been in place for the year under review and up to the date of 
approval of the Annual Report. It is also in accordance with the 
FRC’s ‘Guidance on Risk Management, Internal Control and Related 
Financial and Business Reporting’. 

Whistleblowing
The Committee oversees the operation and effectiveness of 
TP ICAP’s whistleblowing systems and controls. During the year 
the Committee reviewed whistleblowing reports and metrics and 
considered the effectiveness of the whistleblowing arrangements in 
place. Employees and individuals outside of TP ICAP are able to 
raise their concerns anonymously using an independent reporting 
facility managed by a third party. This mechanism is combined with 
a number of ‘Speak Up’ initiatives to raise employees’ awareness of 
the Whistleblowing Policy and procedures. As Whistleblowing 
Champion, I oversee the integrity, independence and effectiveness 
of the whistleblowing arrangements. Angela Crawford-Ingle will 
take over as Whistleblowing Champion from the conclusion of the 
2021 Annual General Meeting.

During the coming year the Committee will continue to review the 
Whistleblowing arrangements in conjunction with the Board.

Annual Report and Accounts 2020
88

Report of the Risk Committee

Michael Heaney
Interim Chair, Risk Committee 

Committee members
Michael Heaney
Angela Crawford-Ingle1
Mark Hemsley1
Angela Knight
Edmund Ng 
Roger Perkin

Meetings
attended
4/4
3/3
3/3
4/4
4/4
4/4

1  Angela Crawford-Ingle and Mark Hemsley attended all meetings upon being 

appointed to the Committee on 16 March 2020. 

How the Committee spent its time during  
the year in scheduled meetings  
%

Project and function risk reviews 
(including business continuity)
Risk framework and governance
Risk culture and compliance
Update from CRO 
Routine matters

29%

27%
18%
16%
10%

More online
The Committee’s terms of reference are available  
on the Company’s website: 
tpicap.com/investors

Annual Report and Accounts 2020
89

Dear fellow shareholder,

On behalf of the Board, I am pleased to present the Report of the 
Risk Committee explaining how the Committee discharged its risk 
oversight responsibilities during 2020.

The Committee’s principal focus throughout the year was on the 
Group’s response to the wide-ranging and rapidly evolving 
challenges posed by the global pandemic, including the steps taken 
to ensure the Group’s operational and financial resilience during 
this period.

However, the Committee also continued to discharge its broader 
risk oversight responsibilities by monitoring the Group’s enterprise-
wide risk profile across all material risk types, with a particular 
focus on the other key risks facing the Group, such as Brexit and 
cyber risk. 

In addition, the Committee oversaw the completion of the project 
to embed the Group’s new Enterprise Risk Management Framework 
(‘ERMF’) across the Group which has resulted in a significant 
enhancement to the Group’s risk management capability. 

In discharging its risk oversight responsibilities, the Committee has 
remained cognisant of the high standards of risk management 
expected of market infrastructure providers and the requirement 
to safeguard the interests of its clients, investors and shareholders.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Key responsibilities of the Committee
The Board has delegated responsibility to the Committee for:

Setting risk appetite, culture, controls and policy 
 > defining the nature and extent of the risks the Group is willing 

to take;

 > defining the expectations for the Group’s risk culture; 

Monitoring, reporting and advisory activities 
 > reviewing the Group’s culture monitoring arrangements and 

promoting a risk-aware culture;

 > overseeing the implementation and annual monitoring of the 
ERMF, including the adoption and implementation of risk 
tolerances and minimum risk management standards;
 > ensuring the Group has an appropriate and effective risk 

management and internal control framework;

 > reviewing the control environment and tracking any 

remedial actions;

 > considering the risks arising from any strategic initiatives and 

advising the Board accordingly;

 > considering the Company’s prospects, current position, 

principal risks, and assessing whether there is reasonable 
expectation that the Company will continue to operate and 
meet its liabilities as they fall due;

 > identifying and considering future and emerging risks, 

regulatory developments and relevant mitigants;

 > providing input to the Remuneration Committee on the 

alignment of remuneration to risk performance; 

 > reviewing resourcing within the Three Lines of Defence;
 > overseeing the independence and effectiveness of the Risk 

and Compliance functions; and

 > reviewing the appointment or dismissal of the Group Chief 

Risk Officer (‘CRO’) and Group General Counsel.

 
 
 
 
 
 
 
Report of the Risk Committee 
continued

Key matters considered by the Committee in 2020

Topic
Broking process

Matters considered and actions taken by the Committee
 > Oversight of the key risks arising from the Group’s broking and post-trade activity, including through 

Infrastructure

Cyber security and data 
protection

the review of the Risk Profile Report presented by the CRO. 

 > This included reviewing material risk events and ensuring remedial action was adopted where 

required, and monitoring the status of systems and controls adopted in relation to pre- and post-trade 
transparency reporting. 

 > Updates on key aspects of the Group’s technology and other infrastructure, including presentations 
by the Group Chief Operating Officer (‘COO’) and Chief Controls Officer. This included oversight of 
the contingency arrangements implemented to ensure continuity of operations during the pandemic, 
including the infrastructure support required to deliver a Group-wide working-from-home capability 
which is compliant with regulatory obligations. 

 > The Committee also continued to monitor the status of the ongoing programmes to enhance the 

Group’s operational resilience and ensure that it can meet its targeted recovery time objectives across 
all areas of the business. 

 > The status of the Group’s cyber security capability, including updates provided by the COO, and 
continuing to monitor the Group’s ongoing activity to enhance cyber resilience against the ever 
evolving cyber threat landscape.

Human capital

 > The Group’s resourcing profile and the steps taken to address key person dependencies. This included 

Financial risk

Capital and liquidity 
adequacy

consideration of the potential implications of the new UK prudential regime for investment firms 
(IFPR) as it relates to compensation structures (due to come into force in January 2022), and 
monitoring the status of succession planning for key senior management positions, particularly in 
light of a number of senior departures during the year.

 > The Group’s financial risk exposure, including its FX profile, credit risk exposure and liquidity demand. 
This included a deep-dive review into the Group’s margin call profile at the start of the pandemic to 
ensure that this could be managed within risk appetite (particularly in light of heightened market 
volatility), and overseeing the completion of a number of projects to migrate clearing arrangements 
to new third-party providers and reduce the Group’s liquidity demand profile. 

 > The Committee also considered the potential impact of both the pandemic and a hard Brexit on the 

Group’s FX exposure and the status of mitigating actions to address this. 

 > Ongoing monitoring of the Group’s capital and liquidity position. As part of this activity, the 

Committee reviewed the annual Group Review of Capital and Liquidity Adequacy, which assesses 
the Group’s prudential position at consolidated Group level. This included reviewing and challenging 
the stress tests undertaken to calculate the capital and liquidity requirements in stressed conditions.
 > In addition, the Committee reviewed the Group Recovery Plan to assess the appropriateness of both 

the various recovery actions defined in the plan and the calibration of the recovery indicators 
adopted to ensure that the Group has sufficient early warning of any potential deterioration in the 
Group’s financial position.

 > Finally, the Committee commissioned an additional out-of-cycle reverse stress test at the start of 

the pandemic to further investigate the Group’s financial resilience in very extreme conditions and 
confirm the specific management actions that could be taken to protect the Group’s financial 
position if required.

Legal and compliance

 > The Committee received updates at each meeting from the Group General Counsel and Head of 

Brexit

Legal entity reorganisation

Capital structure

Compliance on key legal and compliance issues. This included overseeing the Group’s response to a 
range of regulatory issues across the business and to material changes to the regulatory framework in 
which the Group operates. 

 > The Committee also monitored the progress of material litigation brought by or against the Group. 
 > Monitoring the risks associated with Brexit and the status of the Group’s contingency plans to 

maintain UK-EU liquidity in the event that the UK and EU failed to reach agreement on equivalence.
 > Monitoring the Group’s ongoing programmes to relocate its Parent Company to Jersey (in Q1 2021) 
and rationalise its legal entity structure, to ensure any programme risks were being managed effectively.
 > The Committee undertook a number of reviews of the Group’s capital structure in preparation for the 
planned redomiciliation of TP ICAP plc to Jersey and the anticipated acquisition of Liquidnet in Q1 
2021, and in light of the expected introduction of the IFPR in January 2022 (noting that the details of 
this regime are still to be confirmed).

Liquidnet

 > The Committee monitored the status of the Liquidnet transaction and conducted a deep-dive into the 

potential commercial risks associated with the transaction.

Risk framework

 > Monitoring the operation of the Group’s new ERMF with the objective of ensuring that this was 

consistently embedded across all areas of the Group (both organisationally and geographically). 
This included receiving independent third-party reports on the status of the ERMF operation and 
a presentation on the new GRC system that underpins the ERMF.

Annual Report and Accounts 2020
90

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Review of Committee effectiveness
An external review of the Committee’s effectiveness was completed 
in January 2021 which determined that the Committee was 
operating effectively in most areas. Specific developments and 
actions to be taken by the Committee during 2021 will be considered 
at a future meeting. During the year the Committee also conducted 
a review of its Terms of Reference.

Key priorities for 2021
The Committee will continue to monitor the key risks faced by the 
Group to ensure these are being managed effectively and in 
accordance with the Group’s risk appetite. 

This will include ongoing oversight of the Group’s response to the 
global pandemic and ensuring that the Group incorporates the 
lessons learned during 2020 to further enhance the robustness and 
efficiency of its business continuity arrangements. The Committee 
will also closely monitor the Group’s business performance to ensure 
that prompt management action can be taken, if required, to 
perverse the Group’s financial position. 

In addition, the Committee will continue to monitor the Group’s 
ongoing response to Brexit to ensure that appropriate action is 
taken to protect the Group’s business in the context of the evolving 
political and regulatory situation. The Committee will also be 
paying close attention to the status of the Liquidnet integration 
programme which will include ensuring that the acquired business is 
appropriately incorporated within the Group’s Enterprise Risk 
Management Framework. 

This monitoring will be informed by deep-dive reviews into specific 
areas of the business, with a number of such reviews planned for 
2021 covering a range of business areas and risk types. 

The Committee will also continue to monitor the key emerging risks 
to which the Group is exposed. This includes the potential impact of 
any changes to US policy implemented by the new administration, 
including in relation to financial regulation and taxation, as well the 
potential changes to the EU regulatory regime arising from the 
ongoing review of MiFID II. 

The Committee will also continue to track the emerging risks for the 
Group’s business associated with climate change, including the risks 
arising from climate change itself and from the transition to a zero 
carbon economy, and will also monitor regulatory developments in 
this area to ensure the Group continues to meet regulatory 
expectations as regards effective risk management.

Finally, the Committee will continue to oversee the ongoing 
initiatives in relation to conduct and culture, to assess the Group’s 
performance against its stated objective of ensuring that its staff 
maintain the expected high standards of personal and 
professional conduct.

Michael Heaney
Interim Chair
Risk Committee 
9 March 2021

Annual Report and Accounts 2020
91

 
 
 
 
 
 
 
Report of the Remuneration Committee

Angela Knight
Interim Chair, Remuneration Committee

Committee members
Angela Knight
Edmund Ng
Michael Heaney
Lorraine Trainer2

Dear fellow shareholder,

As interim Chair of the Remuneration Committee, I am pleased to 
present the Directors’ Remuneration Report on behalf of the Board. 
I would first like to pay tribute to the work of Lorraine Trainer the 
previous Chair of the Committee who stood down from the Board 
at the 2020 AGM for personal reasons, as well as welcoming Tracy 
Clarke who, following the 2021 AGM, will be taking over as the new 
Chair of the Remuneration Committee.

Introduction
Briefly, looking back at the 2020 AGM, the Annual Report on 
Remuneration was overwhelmingly supported by 98% of our 
shareholders, following on from a similar support of 96% for our 
Remuneration Policy. 2020 then rapidly became a year that none 
had expected. I think it is therefore important to state at the start of 
this letter that the Committee recognises the enormous challenges 
posed by COVID-19 and the immense impact that it has had on our 
employees and all our stakeholders. Most of these challenges are 
still with us in 2021 and all the uncertainties remain. 

Meetings
attended1
7/7
7/7
7/7
3/3

1 

In addition to the seven scheduled meetings, two further meetings were held at 
short notice to discuss employee share plans and executive remuneration. All 
members were able to attend the additional meetings.

2  Lorraine Trainer stepped down as a member of the Committee on 13 May 2020.

How the Committee spent its time during  
the year in scheduled meetings 
%

Executive director remuneration
Senior management and 
wider workforce remuneration
Policy and Compliance 
(including risk and control 
impact on remuneration)
Executive Incentive Schemes
Remuneration Reporting
Routine matters

27%
25%

22%

12%
9%
5%

In this report we have set out the key decisions taken by the 
Committee on remuneration, alongside the rationale for why these 
were most appropriate for TP ICAP. Where judgements needed to 
be made, in addition to performance against targets, we have 
taken into consideration the experience of all our stakeholders and 
the performance of the business in important areas such as ESG, 
where metrics are currently still being developed. The Committee 
has been mindful that the Executive Director’s pay should 
appropriately reflect the Company’s actual performance and is 
aligned with the experience of our employees and the wider 
context in which the Company operates. 

Business and stakeholder context in 2020
In this challenging year, it is very clear that the Company as a whole 
has delivered a robust performance and at the same time has 
supported our various stakeholders.

For the greater part of the pandemic, our staff have worked from 
home and we have only brought them back to the office when 
lockdown rules allowed and we could properly protect them. From 
a business, regulatory and staff perspective, the Committee has not 
underestimated the complexity and cost of operating a global 
broking company safely in this way and returning our staff to the 
office is our preferred business model.

Throughout this period, TP ICAP also took the decisions to:

 > make no redundancies as a result of COVID-19;
 > make no salary reductions for our general workforce; 
 > make no dividend reductions as a result of COVID-19; and
 > not apply for any government support packages except a 
de-minimis amount in Hong Kong, which we are returning.

Suppliers have continued to be paid promptly, more services and 
products have been provided to our customers at competitive prices 
and investment in the business has continued.

More online
The Committee’s terms of reference are available  
on the Company’s website: 
tpicap.com/investors

Annual Report and Accounts 2020
92

Whilst these decisions impacted our operations and financial 
performance, the Group still delivered a robust financial 
performance, demonstrating our strong operational capability 
and the growing success of our diversification strategy against the 
difficult macroeconomic backdrop. This resulted in a revenue of 
£1,794m in 2020, being a marginal decline of 2% on a reported 
basis and 1% at constant currency basis.

The Board declared and paid an interim dividend per share in 
November 2020 and is recommending a final dividend to be paid 
in May 2021. Overall this represents a one-off 50% reduction 
year-on-year and this decision was taken following the views and 
comments expressed to us by shareholders regarding investment in 
the strategic priorities of the business and particularly the game 
changing acquisition of Liquidnet. To be clear, the dividend 
reduction was not related to the pandemic. Importantly, 98% of the 
rights issue linked to the acquisition of Liquidnet was taken up by 
our shareholders, demonstrating their strong support for this 
strategic priority. Similarly strong support was also achieved for the 
redomiciliation of TP ICAP to Jersey, which will allow the Company 
more flexibility in using its capital to develop and grow the business.

Liquidnet is an integral part of the strategy of focusing the 
Company on its three key strategic pillars of electronification, 
aggregation and diversification, which in turn is to underpin 
long-term growth and sustainability in a fast changing market, 
with accompanying benefits to shareholders. The details were set 
out at our Capital Markets Day presentations in December.

Work is now underway to develop clear targets for the purpose of 
ensuring the full realisation of the benefits of these strategic steps 
and again, with particular emphasis on the Liquidnet acquisition.

Remuneration outcomes for 2020
The Committee set the bonus targets for 2020 early in the year, 
before the global impact of the COVID-19 pandemic was 
understood fully. The Committee has taken the decision that 
one-off unforeseen costs incurred in order to preserve the Group’s 
business operations and preserve the investment in strategy would 
be added back to the adjusted operating profit of £272m.

During the year the business made a one-off £8m investment in 
technology to support all of our employees to be able to work from 
home going forward. This, combined with the cost incurred replanning 
the Group’s strategy to assist in the re-prioritisation and re-phasing 
of the Group’s resources, resulted in a revised £283m adjusted 
operating profit for executive remuneration calculation purposes.

For the executive team this has resulted in 2020 bonus outcomes for 
the Executive Directors that are reduced by c.18% compared with 
2019. This is comparable to bonus reductions across the cohort of 
senior executives within the business. Further detail on incentive 
outcomes, including performance against individual and firm-wide 
strategic objectives can be found on pages 100 to 102. 

Given the strong execution of these transformational strategic 
steps, and the experience of the key stakeholders of our 
shareholders, employees and customers, the Committee 
determined that this outcome was a fair and true reflection 
of performance in the year. 

Meanwhile, in respect of the LTIP, no Long Term Incentives had 
performance periods ending in 2020.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Potential windfall gains
The share price performance over the last year has been volatile, partly 
driven by the changing demands of the TP ICAP customers and to a 
lesser extent by the overall market volatility as a result of COVID-19. 
The 2020 LTIP award was granted on 30 March 2020, based on the 
share price at the time and in line with our normal approach. 

As highlighted in the announcement at the time, the Committee 
has full discretion to ensure that the final outcomes are warranted 
based on the performance of the Company in light of all relevant 
factors and that there have not been any windfall gains, and the 
Committee will conduct this review at the point of vesting.

Remuneration packages and our peer group
Salary
The Committee reviewed the base salaries of the Executive 
Directors, to ensure that they reflect the scope of individual 
responsibilities and are sufficiently competitive for TP ICAP to 
be able to attract and retain high calibre employees. 

TP ICAP operates in a very specific market, which in turn presents 
challenges when benchmarking the appropriate levels of 
remuneration for the executive team and many of its employees. 
TP ICAP is the largest – as measured by revenue – of the three 
global broking firms, with no other directly comparable UK 
competitors of any size.

The remuneration paid to the senior executives in our global 
competitors is substantially greater than in TP ICAP and this 
differential was flagged in the 2019 Remuneration Report. The 
Committee is aware and understands that there are different 
remuneration regimes and expectations in different geographies, 
but nevertheless we are presented with a unique situation as the 
only global company in our sector that is headquartered in the UK 
and very real difficulties, when it comes to determining an 
appropriate peer group. 

In undertaking this review, the Committee has considered the 
remuneration as benchmarked against both our international peers 
where we compete for talent, as well as with other UK FTSE listed 
companies. As part of this review, the Committee found that in 
practice, our market for senior executive talent seldom comes 
from other UK quoted companies and confirmed that our key 
international peers, operating under their different regulatory 
regimes, have different payment models, such as significantly less 
requirements for deferral. 

Considering this market data in accordance with our Policy, the 
salary review clearly demonstrated to the Committee that the 
current remuneration was not at a level commensurate with the 
essential goal of attracting and retaining first class international 
employees in the Group. This concern has been highlighted by the 
incoming Committee Chair as a priority, ahead of the new 
remuneration policy.

The Committee has sought to strike an appropriate balance 
between recognising FTSE company pay models, whilst ensuring 
executives are appropriately retained and motivated, when 
compared to our international peers.

With the Company moving through an extensive and essential 
transformation, led by the CEO, the need to ensure stability of 
leadership at this time is paramount. As an interim step ahead of 
the new policy, the Committee has therefore determined that an 
increase to the salary of the CEO of 9.7% will be made from 1 April 
2021, after the completion of the Liquidnet acquisition. 

Annual Report and Accounts 2020
93

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

In coming to this decision, the Committee has taken into account the 
c.14% increase in size of the Group following the purchase of Liquidnet 
which in turn will result in greater and additional responsibilities for 
the CEO, as well as the ongoing challenges of COVID-19. Taken in 
the round, and given the scale of misalignment with our key peers, 
the Committee believes that this increase is appropriate.

Bonus and LTIP
When engaging with shareholders during the acquisition of 
Liquidnet there was a clear request to understand how the 
acquisition would impact Executive Director Remuneration. 
Shareholders were understandably keen to ensure that our 
Executives were aligned to the success of this deal both in terms 
of the integration of Liquidnet and in developing its potential to 
transform the wider TP ICAP Group. The Committee was required 
to bring a new Directors’ Remuneration Policy to shareholders at 
the 2022 AGM; however, given the transformational impact of this 
acquisition we have decided to bring this Policy review forward. 
The Committee has decided not to award a 2021 LTIP and to 
commence consultations with shareholders over a new 
Remuneration Policy in the coming months with the intention of 
holding an Extraordinary General Meeting (‘EGM’) by the autumn 
to approve the new policy, including the grant of a 2021 long-term 
incentive. Given the acquisition will complete in the early part of 
the year, when we would normally be setting measures and targets 
for the coming award, this approach allows the Committee the time 
to fully reflect on what the most appropriate incentive will be and 
to ensure that our Executives are fully aligned to the success of this 
deal, and the wider TP ICAP strategy going forward.

Until the intended EGM, the bonus measures for 2021 will remain 
underlying operating profit and RoE and are unchanged 
from 2020.

Engagement with stakeholders
The new strategy coupled with the acquisition of Liquidnet has 
resulted in significant engagement with shareholders, particularly 
in the last months of 2020. Although not specifically about 
remuneration, as noted above, shareholders have commented on 
the need to align Executive Director remuneration with the new 
strategy of the Company. Specific points raised will be included 
in the consultation on the new Remuneration Policy.

Wider workforce consideration
The Committee has regular oversight of the wider employee 
population. Supporting our colleagues through this difficult period 
was, and continues to be, a clear priority from the outbreak of the 
pandemic. Our staff have met these challenges with aplomb 
showing exceptional resilience over the period, including adapting 
their working arrangements.

A very high proportion of our staff participated in our COVID-19 
Response Survey following the first lockdown, which provided the 
Committee with invaluable insights as to how a new way of working 
could be established. This has helped to shape both our Agile 
Working policy and a Non-executive Director (NED) led workforce 
engagement programme as well as an Agile Working model which 
is being piloted in Singapore.

From a remuneration perspective, no colleagues were either 
furloughed or made redundant as a result of the pandemic. Salaries 
have been increased across the Group appropriately, including for 
support staff, who have also been eligible for and in a large 
majority of cases, awarded bonuses.

Annual Report and Accounts 2020
94

As highlighted in the Governance section, Town Hall and Open 
forum sessions have taken place with representatives of the 
Business and NED employee champions to ensure the employee 
voice continues to be heard.

Diversity and inclusion
Off the back of the employee engagement survey in July 2020 
the Committee have looked to evolve and develop diversity and 
inclusion at TP ICAP. This includes the establishing of a D&I 
governance structure and the introduction of dedicated Champions 
whose role includes supporting the D&I agenda alongside 
regional CEOs.

Looking forward
As highlighted above, the Committee will commence consultations 
with shareholders over a new Remuneration Policy in the coming 
months with the intention of holding an EGM by the autumn to 
approve the new policy, including the grant of a 2021 long-term 
incentive. This consultation will include the implications of the 
Investment Firm Prudential Regime on our remuneration, both at 
Board level and below. 

I mentioned earlier the importance of ESG and Diversity & Inclusion 
and the Committee has noted that good progress has been made 
in recruiting more senior women into the Company. This is a 
significant step that I am personally particularly pleased to see 
happen. Notably, in the energy and commodity business, some 
40% of the trading undertaken is now in environmentally friendly 
products, green energy and transition fuels and during 2021 the 
Committee will be giving consideration on the introduction of more 
formal targets in these areas for the purpose of increasing focus 
and transparency.

In conclusion, this extraordinary year has resulted in the Committee 
exercising its judgement in a number of ways, to recognise not only the 
challenges of the year that the Company has had to face, but also 
the strategic and essential transformation programme underway. 

As always, we look forward to a constructive engagement with 
shareholders, and your support of the Directors’ Remuneration 
Report at the 2021 AGM.

Angela Knight
Interim Chair
Remuneration Committee 
9 March 2021

Definitions used in this report
‘Executive Director’ means any executive member of the Board.

‘Senior Management’ means those members of the Company’s 
Group Management Committee (other than the Executive 
Directors) and the first level of management below that level 
including the direct reports to the Chief Information Officer and 
the Global Head of Operations.

‘Broker’ means front office revenue generators; ‘Control 
Functions’ means those employees engaged in functions such as 
Compliance, Legal, HR, Finance, Operations and Risk Control; 
‘Remuneration Code’ means the Remuneration Code of the FCA; 
and ‘2013 Regulations’ means the Large and Medium-sized 
Companies and Groups (Accounts and Reports) Regulations 
2013, as amended by the 2018 and 2019 Regulations.

Remuneration at a Glance 

Remuneration Policy Summary Table

The Remuneration Policy is designed to attract, motivate and retain employees with the necessary skills and experience to deliver the 
strategy, in order to achieve the Group’s objectives and I can confirm that it has operated as intended. We set out below a summary of our 
remuneration policy, and a summary of how each element will be implemented in 2021. The full Executive Directors’ Remuneration Policy, 
approved by shareholders in May 2019, can be viewed on the Company’s website.

Purpose and link to strategy
Reflects the scope of individual 
responsibilities to attract and 
retain high calibre employees

Key features
Reviewed periodically to ensure 
not significantly out of line with 
the market

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Implementation
in 2021
N Breteau £735,000 9.7% increase
R Stewart £438,000 1.2% increase
P Price £445,000 1.6% increase
(page 98)
N Breteau and R Stewart received 
pension contributions of £3k and 
£6k respectively in 2020. Due to 
lifetime allowance limits, P Price 
did not receive any company 
pension contribution page 98. 
This equates to a contribution of 
0.4%, 1.5% and 0% of salary 
respectively.

Performance measures and 
weightings:
 > Adjusted Operating Profit 50%
 > Return on Equity 20%
 > Strategic Performance 30%
(pages 99 to 101)

 > As outlined on Page 94 the 

Committee intends to hold an 
EGM in autumn 2021 to approve 
a new policy, including the grant 
of a 2021 long-term incentive 
(subject to shareholder 
consultation)

Shareholdings as at  
31 December 2020:
 > N Breteau 267,574
 > R Stewart 133,337
 > P Price 158,142
 > (page 103)

In line with the pension allowance 
available to the wider UK 
employee population: currently 
6% of fixed remuneration up to a 
cap of £105,600. No cash 
allowance is provided where 
employees have reached either 
annual or lifetime allowance limits
Medical cover and participation 
in any schemes available to all 
UK employees
Annual assessment of 
performance against strategic 
and financial objectives
On-target performance delivers:
 > CEO: 125% salary
 > Other EDs: 100% salary
Maximum performance delivers:
 > CEO: 250% salary
 > Other EDs: 200% salary
Mandatory 50% deferral into 
shares with a three-year deferral 
period 
Malus and clawback apply
Annual awards of conditional 
shares vesting after three years, 
subject to performance conditions
Subsequent two-year holding 
period (except for any sale to 
settle tax liability)
Maximum: 250% salary
Malus and clawback apply
Share ownership requirements:
 > CEO: 300% salary
 > Other EDs: 200% salary
5-year period to achieve the 
requirement
Post-employment: shares at a level 
equal to:
 > the lesser of 2x base salary or 

the actual shareholding in year 
one, and

 > the lesser of 1x base salary or the 
actual shareholding in year two

Salary

Pension and
benefits

Annual bonus

Provide basic pension provision 
and benefits in line with other 
UK-based employees

Incentivises delivery of TP ICAP’s 
financial and strategic targets

Provides a direct link between 
the achievement of annual 
performance targets and reward.

Long-term  
incentive plan

Align Directors’ interests with 
shareholders by focusing on mid- 
to longer-term shareholder returns

Shareholding  
requirements

Align Directors’ interests with 
shareholders by focusing on 
longer-term shareholder returns, 
including after cessation of 
employment

Annual Report and Accounts 2020
95

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Alignment of Policy with the 2018 Code

To read about how the Committee addresses the factors of clarity, simplicity, risk, predictability, proportionality and alignment to culture 
when determining the Executive Director Remuneration Policy, as set out in Provision 40 of the UK Corporate Governance Code, see page 
83 of the 2019 Annual Report and Accounts.

Performance/retention periods 
TP ICAP plc’s incentive arrangements are designed to ensure good alignment with shareholder experience over the long term.

2020

2021

2022

2023

2024

2025

2026

2027

Salary

Pensions  
and benefits
Annual bonus 
– cash
Annual bonus 
– deferral

LTIP

100%
of variable awards to 
Executive Directors in 
respect of 2020 are at risk 
of clawback

 Clawback period 

 Deferral period 

 Holding period

Malus and Clawback provisions apply to the annual bonus and the LTIP. The circumstances where it may apply include a material or 
adverse misstatement of performance or a material misstatement of results for the period to which the bonus related, or an Executive 
Director’s conduct is found to amount to gross misconduct and/or fraud, wilful dishonesty or accounting malfeasance.

Strategic rationale: the link between strategic objectives and incentive metrics

Our 2020 performance measures were chosen to ensure that our remuneration arrangements support the delivery of our corporate goals, 
including a direct assessment against our strategic objectives through the annual bonus performance measures (see pages 99 to 101). 
The Committee has decided not to award a 2021 LTIP and to commence consultations with shareholders over a new Remuneration Policy 
in the coming months with the intention of holding an EGM by the autumn to approve the new policy, including the grant of a 2021 
long-term incentive. This enables the Committee to ensure that any performance measures best support the Company strategy following 
the Liquidnet transaction.

The table below sets out our Business KPIs, how they link to our strategic pillars (as set out on pages 21 and 22 of the annual report) and 
demonstrates how our in-flight incentive arrangements are aligned to these through our careful selection of performance measures.

Link to strategic objectives

Performance measure

Bonus weighting

LTIP weighting

Adjusted Operating Profit
New Business Growth

50% (UOP)

20% (NBG)

Return on Equity (%)
EPS (Compound Annual 
Growth Rate)

20%

Relative TSR

Strategic Performance

30%

30%

50%

Overall TP ICAP goals
Financial KPIs
Revenue Growth
Adjusted Operating 
Profit Margin
Contribution
Adjusted earnings 
per share
Ratio of front office to 
support function 
employees
Wider goals
Core aims to create 
long-term shareholder 
value across the market 
cycle
Core strategic objectives as 
set out on pages 99 to 101 
for 2020

Strategic Objectives

 Electronification and technology   Liquidity aggregation   Diversification   People, conduct and compliance 

Annual Report and Accounts 2020
96

 
 
 
 
 
 
 
 
Illustration of the application of the Remuneration Policy

The charts below show the potential total remuneration for each Executive Director for 2020 at minimum, target and maximum as well 
as the actual pay received. This shows the actual pay delivered was below target for each Executive Director.

Illustration of the application of  
the Director’s Remuneration Policy 
CEO

Illustration of the application of  
the Director’s Remuneration Policy 
CFO

£5.0

£4.0

£3.0

£2.0

£1.0

£0.68m

)

m
£
(
n
o
i
t
a
r
e
n
u
m
e
R

£4.03m

41.6%

41.6%

£2.35m

35.6%

35.6%

£1.94m

65.1%

£0

100%

28.8%

16.8%

34.9%

Minimum

Target

Maximum

Actual

)

m
£
(
n
o
i
t
a
r
e
n
u
m
e
R

£5.0

£4.0

£3.0

£2.0

£1.0

£0

£1.41m

38.2%

30.6%
31.2%

£0.44m

100%

£2.39m

45.3%

36.2%

18.5%

Minimum

Target

Maximum

£1.07m

58.6%

41.4%

Actual

Fixed pay

Annual bonus

Long-term incentives

Fixed pay

Annual bonus

Long-term incentives

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Illustration of the application of  
the Director’s Remuneration Policy 
GGC

)

m
£
(
n
o
i
t
a
r
e
n
u
m
e
R

£5.0

£4.0

£3.0

£2.0

£1.0

£0

£1.42m
38.4%
30.7%
30.9%
Target

£0.44m
100%
Minimum

£2.41m

45.4%

36.3%

18.3%
Maximum

£1.10m

59.9%
40.1%
Actual

Fixed pay

Annual bonus

Long-term incentives

Annual Report and Accounts 2020
97

 
 
 
 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Annual Report on Remuneration (audited)

The Annual Statement made by the Remuneration Committee Chair on pages 92 to 94 and this Annual Report on Remuneration are 
subject to a shareholders’ advisory vote at the forthcoming AGM. Information in this report is audited, where stated.

The single total remuneration for the Executive Directors who held office during the year-ended 31 December 2020 was as follows:

Executive Directors
(£000s)
Nicolas Breteau
2020
2019
Robin Stewart
2020
2019
Philip Price
2020
2019

Salaries

Taxable
benefits1

Pension

Total fixed 
remuneration

Short-term incentives
Deferred

Cash

Total

Long-term 
incentives
vested2

Total variable 
remuneration

Single total 
figure of 
remuneration

670
650

433
425

438
425

3
3

3
3

3
3

3
3

6
9

–
–

676
656

442
437

441
428

631
764

313
385

329
398

631
764

313
385

329
398

1,261
1,528

626
769

659
795

–
–

–
–

–
–

1,261
1,528

626
769

659
795

1,937
2,184

1,068
1,206

1,100
1,223

1  Taxable benefits represent private medical insurance. 
2  No Long Term Incentives vested during 2020 as the Transformation LTIP granted in 2017 was forfeited upon grant of awards under the LTIP plan in 2019.

Fixed remuneration (audited)
For 2021, the Executive Directors’ base salaries have been reviewed and as set out in the Chair’s letter on pages 92 to 94 the following 
increases applied:

Executive
Nicolas Breteau
Robin Stewart
Philip Price

Date of appointment
10 July 2018
10 July 2018
3 September 2018

Base salary effective  
from 1 January 2020
£670,000
£432,500
£437,500

Base salary1
£735,000
£438,000
£445,000

1  Base salary effective from 1 April 2021 for Nicolas Breteau and 1 January 2021 for Robin Stewart and Philip Price.

2020 annual bonus (audited) 
For 2020, the annual bonus was based 70% on financial performance and 30% on strategic performance, with a maximum opportunity of 
2.5x base salary for the CEO and 2x base salary for the CFO/GGC. Details of the 2020 financial measures and weightings, the targets set 
and performance against these targets are provided in the table below: 

Financial performance measure
Adjusted Operating Profit

Weighting
50%

Return on Equity

20%

Threshold 
performance target 
(25% of maximum)

Target  
performance  
target (50% of 
maximum)

Maximum  
performance  
target (100% of 
maximum)

Actual (£m), 283

Actual, 11%

260

10%

280

11%

Actual  
performance 
achieved
£283m

Weighted payout  
(% of maximum 
total bonus)
34%

11%

13%

300

12%

Strategic Performance

30%

Strategic objectives, along with the corresponding 
performance assessment, are set out in the tables below. 

25%–28%

25%–28%

Total bonus outcomes

72%–75%

Annual Report and Accounts 2020
98

 
 
 
 
 
S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

COVID-19 crisis, with no government support 
or need for staffing reductions. Liquidity has 
been well managed and excellent strategy 
progress has been made with the proposed 
acquisition of Liquidnet.

3% Strong progress during the year with 

completion of the redomiciliation expected in 
Q1 2021 and good progress on the liquidity 
and capital adequacy strategy models.

2.5% Excellent progress with key strategic 

appointments operating effectively to 
deliver results.

3% Further progress has been made in 
relationships with regulators.

4% Very strong delivery with exceptional results.

3.5% Despite the COVID-19 crisis, significant 

progress has been made across all areas.

5% Nicolas has demonstrated exceptional 

performance on an individual level, whilst also 
leading the management team to deliver on 
the strategy in unprecedented circumstances.

Details of the 2020 strategic objectives for each Executive Director, along with the corresponding performance assessment, are set out 
in the following tables:

Nicolas Breteau

CEO strategic objectives 
Demonstrate efficient stewardship of the COVID-19 crisis, 
focusing on stakeholders, liquidity, cost control and the 
medium-term Group strategy.

Weighting1
7%

Score Assessment of performance
7% Demonstrated strong stewardship of the 

Develop long-term Capital and Liquidity strategy for the 
Company including redomiciliation and the review and 
development of capital adequacy models and capital 
allocation models.
Continue strategic development of the leadership team, with 
a focus on both organisational structure and the evaluation 
of performance.
Develop and maintain constructive and positive relationships 
and dialogue with regulatory bodies.
Drive the delivery of the TP ICAP Risk Management 
Framework with focus in 2020 on embedding 
the programme.
Drive and continue to embed the right culture for TP ICAP 
with particular emphasis on ESG, Diversity and Inclusion and 
employee engagement.
Remuneration Committee discretion.

4%

3%

3%

4%

4%

5%

Total for strategic metrics

30%

28%

1 

Expressed in percentage points summing to 30% in total, 30% being the proportion of the total bonus determined by reference to non-financial metrics. Weightings 
adjusted to take into account the introduction of a specific COVID response objective part-way through the year.

Annual Report and Accounts 2020
99

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Robin Stewart

CFO strategic objectives
Demonstrate efficient stewardship of the COVID-19 crisis, 
focusing on liquidity, costs and the medium-term 
Group strategy.

Weighting1
7%

Develop long-term Capital and Liquidity strategy for the 
Company, specifically capital adequacy models and capital 
allocation models.

Continue to strengthen the finance leadership team, with 
focus on both organisational structure, succession and 
evaluation of performance. 
Strengthen the financial planning and cost control teams 
within the Finance function.
Drive the Group budget process and management 
information outputs.
Drive and continue to embed the right culture for TP ICAP 
looking to improve diversity and inclusion as well as 
employee engagement scores.
Remuneration Committee discretion.

5%

3%

3%

4%

3%

5%

Score Assessment of performance
7% Demonstrated strong stewardship of the 
COVID-19 crisis. Liquidity has been well 
managed and costs have been well controlled 
via a revised cost framework.
3.5% Strong progress during the year with 

completion of the redomiciliation expected in 
Q1 2021 and good progress on the liquidity 
and capital adequacy strategy and models.

2% Noticeable progress has been made this year 

with key roles filled and upgraded.

2% This objective is in progress and is on track for 

completion during 2021.

2.5% Work continues to improve processes.

3% A strong contribution. Robin has acted as an 
advocate for the Group’s values, actively 
participating in a number of initiatives.
5% Robin has demonstrated strong performance 
on an individual basis but has also worked as 
part of the management team to ensure that 
the strategy was delivered upon despite the 
complexity created by the COVID-19 crisis.

Total for strategic metrics

30%

25%

1 

Expressed in percentage points summing to 30% in total, 30% being the proportion of the total bonus determined by reference to non-financial metrics. Weightings 
adjusted to take into account the introduction of a specific COVID response objective part-way through the year.

Annual Report and Accounts 2020
100

Philip Price

GGC strategic objectives
Demonstrate efficient stewardship of the COVID-19 crisis, 
focusing on stakeholders, liquidity, costs and the medium-
term Group strategy.

Weighting1
6%

Develop long-term Capital and Liquidity strategy for the 
Group, with the key delivery of the redomiciliation strategy 
alongside the implementation of revised Governance 
structures and progress against the UK legal entity review.
Continue to develop and strengthen leadership teams, with 
focus on organisational structure, succession, individual 
development and evaluation of performance.
Develop and maintain constructive and positive relationships 
and dialogue with regulatory bodies.

Manage the delivery of the TP ICAP Risk Management 
Framework with a focus in 2020 on embedding 
the programme.
Drive and continue to embed the right culture for TP ICAP 
looking to improve diversity and inclusion as well as 
employee engagement scores.
Remuneration Committee discretion.

5%

3%

3%

5%

3%

5%

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Score Assessment of performance
6% Philip has been instrumental in developing 
our strategic roadmap during the COVID-19 
crisis and has ensured the regulators were up 
to speed throughout.

5% Exceptional performance, delivering on all 
objectives relating to governance structures.

1% Progress has been made with further focus 

required during 2021.

3% Positive and constructive relationships 
have been maintained throughout all 
strategic activity.

5% This objective was fully achieved with 

outstanding input from Philip.

3% Philip is a role model for the right conduct 

and culture, with extensive engagement 
throughout the organisation.
5% Philip has demonstrated very strong 

performance on an individual level (particularly 
as it related to the redomiciliation), whilst also 
working as part of the management team to 
deliver on the strategy and objectives in 
unprecedented circumstances. 

Total for strategic metrics

30%

28%

1 

Expressed in percentage points summing to 30% in total, 30% being the proportion of the total bonus determined by reference to non-financial metrics. Weightings 
adjusted to take into account the introduction of a specific COVID response objective part-way through the year.

Total annual bonus outcome for 2020 performance
The total bonus for each Executive Director for the year to 31 December 2020 is therefore as follows (audited):

Measure
Underlying Operating Profit
Return on Equity
Strategic Performance
Total bonus (as a percentage of maximum)
Total bonus (£000s)

Weighting
50%
20%
30%
100%

CEO bonus 
(% Max bonus)
34%
13%
28%
75%
1,261

CFO bonus
(% Max bonus)
34%
13%
25%
72%
626

GGC bonus
(% Max bonus)
34%
13%
28%
75%
659

50% of the total bonus for each Executive Director will be awarded in Company shares and deferred for three years in accordance with the 
Rules of the Executive Director Bonus Plan.

Annual Report and Accounts 2020
101

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Long-term incentives
Transformation LTIP Units awarded in 2017 (audited) 
Awards were originally granted to the former Executive Directors on 19 May 2017, subject to Absolute TSR and Underlying EPS 
performance measures. The targets were disclosed in full on page 77 of the 2017 DRR. In 2019 the Executive Directors were granted awards 
under the current LTIP and awards they had held in the Transformation LTIP were simultaneously forfeited. Subsequent to this, the Absolute 
TSR and Underlying EPS threshold conditions of 8% p.a. and 48p, respectively, were measured and deemed not have been achieved and 
the Committee therefore agreed that these awards will lapse in full for all other participants. 

Performance graph
A graph depicting the Company’s TSR in comparison to other companies in the FTSE 250 index (excluding investment trusts) in the ten 
years to 31 December 2020 is shown below. 

The Board believes that the above index is most relevant as it comprises listed companies of similar size.

Total shareholder return

£
)
d
e
s
a
b
e
r
(
n
r
u
t
e
r

l

r
e
d
o
h
e
r
a
h
s

l

a
t
o
T

250

200

150

100

50

Dec 10

Dec 11

Dec 12

Dec 13

Dec 14

Dec 15

Dec 16

Dec 17

Dec 18

Dec 19

Dec 20

TP ICAP

FTSE 250 Index (excluding Investment Trusts)

Source: Eikon from Reﬁnitiv

This graph shows the value, by 31 December 2020, of £100 invested in TP ICAP on 31 December 2010, compared with the value of £100 
invested in the FTSE 250 (excluding investment trusts) Index on the same date.

Chief Executive remuneration history 

Year ended
31 December 2020
31 December 2019
31 December 2018

31 December 2017
31 December 2016
31 December 2015
31 December 2014

31 December 2013
31 December 2012
31 December 2011
31 December 2010

Name
Nicolas Breteau
Nicolas Breteau
Nicolas Breteau1
John Phizackerley2
John Phizackerley6
John Phizackerley
John Phizackerley
John Phizackerley3
Terry Smith4
Terry Smith 
Terry Smith5
Terry Smith5
Terry Smith5

Total 
Remuneration 
£000
1,937
2,184
757
325
1,666
3,381
2,250
720
433 
2,856
3,153
4,929
4,344

Annual bonus % 
of max payout
75.0%
94.0%
56.6%
0%
88%
94%
80%
n/a
n/a 
51%
n/a
n/a
n/a

LTI % of max 
vesting
0%
0%
0%
0%
62%
74%
n/a
n/a
–
–
–
45%
–

For the six-month period from 10 July 2018. Percentage represents the overall percentage score achieved on individual performance targets.

1 
2  Total Remuneration includes base salary received through to termination date of 9 July 2018.
3  For the four-month period from 1 September 2014.
4  For the eight-month period from 1 January 2014 to 31 August 2014.
5  Variable remuneration was uncapped in the years 2009-2012.
6  2017 reflects the final LTIS paid out in 2018 relating to 2017 reduced by the forfeiture of deferred bonus relating to 2017. 

Annual Report and Accounts 2020
102

 
 
 
 
Relative importance of spend on remuneration 
The table below shows the expenditure and percentage change in overall spend on employee remuneration and dividend payments:

£m
Employee remuneration1
Shareholder dividends paid2

2020
1,153
94

2019
1,120
94

% change
–
–

Employee remuneration includes employer’s social security costs and pension contributions.

1 
2  Shareholder dividends comprises the dividends paid.

Directors’ interests 
The interests (all beneficial) as at 31 December 2020 in the ordinary share capital of the Company were as follows:

Director
Richard Berliand
Nicolas Breteau
Robin Stewart
Philip Price
Angela Knight
Roger Perkin
Edmund Ng
Michael Heaney
Angela Crawford-Ingle4
Mark Hemsley4

LTIP shares3
–
1,031,475
670,402
674,009
–
–
–
–
–
–

Unvested
shares2
–
419,986
187,976
205,930
–
–
–
–
–
–

Shares1
75,000
44,982
33,710
49,000
2,150
5,000
20,000
40,000
9,716
–

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

1 

Following the redomiciliation, the Directors no longer hold these interests in the Company but instead hold interests in ordinary shares in TP ICAP Group plc. In addition, 
since 31 December 2020, certain of the Directors also took up their entitlements under the Rights Issue. Further to the redomiciliation and the Rights Issue, the Directors held 
the following interests (all beneficial) in shares in TP ICAP Group plc as at 5 March 2021:

Director
Richard Berliand
Nicolas Breteau
Robin Stewart
Philip Price
Angela Knight
Roger Perkin
Edmund Ng
Michael Heaney
Angela Crawford-Ingle4
Mark Hemsley4

LTIP shares3
–
1,157,315
752,191
756,238
–
–
–
–
–
–

Unvested
shares2
–
471,225
210,909
231,052
–
–
–
–
–
–

Shares1
105,000
62,974
47,194
68,600
3,010
7,000
28,000
56,000
13,602
–

2  Shares awarded under the Deferred Bonus Plan for 2016, 2017, 2018 and 2019 as appropriate. Share vesting is governed by the rules of the Plan.
3  LTIP shares are subject to performance conditions, details of which are set out in the table entitled ‘Conditional Share Awards under the LTIP’ 
4  Appointed to the Board on 16 March 2020.

Annual Report and Accounts 2020
103

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Shareholding requirements (audited)
Executive Directors must build a holding in minimum value of the Company’s ordinary shares equivalent to 300% of base salary in respect 
of the Chief Executive and 200% of base salary for all other Executive Directors. The normal expectation is that this is built up over 
a maximum five-year period from appointment to the Board. All Executive Directors who served during the year complied with the 
Company’s requirements in respect of their interests in the shares of the Company.

Scheme interests awarded in the year (audited) 
The table below sets out scheme interests awarded to Executive Directors in the year, alongside details of the performance conditions, 
vesting schedule and retention period. 

Date of  
Grant

Granted during 
the year1

Executive  
Director
Conditional Share Awards under the LTIP 
30/03/20
Nicolas Breteau
30/03/20
Robin Stewart
30/03/20
Philip Price
Deferred shares awarded under the Annual Bonus 
30/03/20
Nicolas Breteau
30/03/20
Robin Stewart
30/03/20
Philip Price

220,496
111,043
114,723

483,433
312,067
315,674

Face value  
£000

Face value % 
salary

Performance  
conditions

Vesting  
date

End of retention 
period

£1,675
£1,081
£1,094

£764
£385
£398

250%
250%
250%

118%
91%
94%

Relative TSR (50%)
EPS (30%)
New Business Growth (20%)

March 2023 March 2025
March 2023 March 2025
March 2023 March 2025

n/a

March 2023
March 2023
March 2023

n/a
n/a
n/a

1  The face value of the awards was converted into a number of shares using a share price of £3.4648, being the closing share price on the dealing day immediately preceding 

the grant date, adjusted for SDRT and commission to replicate a theoretical purchase price to the Company.

Chief Executive pay ratio 
The table below compares the 2020 single total figure of remuneration for the CEO with that of the Group’s UK employees who are paid at 
the 25th percentile (lower quartile), 50th percentile (median) and 75th percentile (upper quartile).

Year
2020
2019

Method
A
A

25th percentile  
pay ratio 
34:1
38:1

50th percentile 
pay ratio
18:1
20:1

75th percentile  
pay ratio
8:1
9:1

The Committee chose to use Option A to calculate the ratio as the data was available and it considered that approach to be the most 
accurate. The employee data was taken as at 31 December 2020; employee means anyone employed under a contract of service. 
A full-time equivalent total was created for part-time employees and the remuneration of employees hired during the year was annualised. 
The resulting list was then ranked to identify the individuals at the 25th, 50th and 75th percentiles compared to whom the ratios were 
calculated. The table below sets out the salary and total pay and benefits for the three identified quartile point employees.

2020
Salary
Total pay and benefits
2019
Salary
Total pay and benefits

25th percentile

50th percentile

75th percentile

£46,000
£57,128

£55,000
£57,064

£100,000
£107,115

£51,667
£109,716

£131,250
£233,703

£95,000
£230,554

Total pay and benefits have remained broadly consistent, with movement in salary levels reflective of the range of compensation 
arrangements within the Group.

Annual Report and Accounts 2020
104

Percentage change in Directors’ remuneration 
The Committee monitors the changes year-on-year between our Directors’ pay and average employee pay. In accordance with The 
Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019, the table below shows the percentage 
change in Executive Director and Non-Executive Director total remuneration compared to the change for the average of employees within 
the Company. 

Chief Executive Officer
Chief Financial Officer
Group General Counsel
Richard Berliand (NED)
Angela Knight
Roger Perkin
Michael Heaney
Edmund Ng
Lorraine Trainer
Angela Crawford-Ingle
Mark Hemsley
Employees

Salary/fees
FY 2020
3%
2%
3%
5%
22%
13%
2%
-6%
-32%
n/a
n/a
2%

Taxable benefits
FY 2020
3%
3%
3%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
10%

Short-term 
variable pay
FY 2020
-17%
-19%
-17%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
-15%

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Short-term variable pay includes annual bonus (both cash and deferred bonus).

As the Parent Company does not have employees, the data above represents a voluntary disclosure against a suitable comparator group. 
A large portion of the Group’s remuneration is payable to Brokers who earn a significant portion of their income as contractual bonus 
based on a formula linked to revenue. It was therefore considered that comparison of the Executive Director’s remuneration with that of UK 
non-broker staff would accordingly be more meaningful than comparison with all employees. Employee calculations have been carried out 
using the mean figures, which we believe best reflects the compensation paid within the Group.

The increase in taxable benefits for employees is reflective of an increased take up in family medical insurance during 2020, whilst 
movements in NED fees relate to changes in roles during 2019 and 2020.

Fees paid to NEDs (audited)
The single total remuneration for each of the Non-executive Directors who held office during the year ended 31 December 2020 was 
as follows:

Richard Berliand1
Angela Knight2
Roger Perkin
Michael Heaney
Edmund Ng
Lorraine Trainer3
Angela Crawford-Ingle4
Mark Hemsley5

Fees

Benefits

Total

2020
£000
300
124
105
141
126
42
72
70

2019
£000
285
102
93
138
135
98
–
–

2020
£000
–
–
–
–
–
–
–
–

2019
£000
–
–
–
–
–
–
–
–

2020
£000
300
124
105
141
126
42
72
70

2019
£000
285
102
93
138
135
98
–
–

1  The remuneration figure of £285k comprises £235k in respect of Richard Berliand’s annual Chairmanship fees pro-rated for the year from his date of appointment and £50k 
(excl. VAT) consultancy fees paid to his services company, Richard Berliand Limited. The consultancy fees were paid in respect of services provided between 22 January and 
18 March 2019 prior to but in anticipation of his appointment, which are treated as remuneration for qualifying services and accordingly disclosed as part of his 
remuneration total.

2  Appointed as Remuneration Committee Chair on 13 May 2020. Her remuneration has been pro-rated accordingly.
3  Retired from the Board on 13 May 2020. Her remuneration has been pro-rated accordingly.
4  Appointed 16 March 2020. Her remuneration has been pro-rated accordingly.
5  Appointed 16 March 2020. His remuneration has been pro-rated accordingly.

Annual Report and Accounts 2020
105

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Payments for loss of office and payments to past Directors (audited) 
There were no payments made for loss of office or remuneration payments made to former Executive Directors during the year.

Non-executive Directors’ fees (audited)
The NED fees for 2021 are as follows:

£m
Chair
Base fee
Senior Independent Director
Chair of the Audit, Risk and Remuneration Committees
Membership of the Audit, Risk and Remuneration Committees
Overseas-based NED supplement
Regional Engagement NED

Fees from 
1 January 2021
£300,000
£70,000
£15,000
£25,000
£10,000
£35,000
£10,000

Fees from
1 January 2020
£300,000
£70,000
£15,000
£25,000
£10,000
£35,000
£10,000

Non-executive Directors received no other benefits or other remuneration other than reimbursement of all reasonable and properly 
documented travel, hotel and other incidental expenses incurred in the performance of their duties and any tax and social costs arising 
thereon. NEDs based overseas will be reimbursed for reasonable costs of travel and accommodation for trips to London to attend Board 
meetings. Any UK tax liability thereon will be met by the Company.

With effect from October 2020 the overseas-based NED supplement has been temporarily suspended.

Voting at the 2020 AGM 
At the AGM held on 13 May 2020 the following votes were cast in respect of the Report on Directors’ Remuneration. The votes shown below 
in relation to the Directors’ Remuneration Policy were cast on 15 May 2019:

Approval of the Directors’ Remuneration Report
Approval of the Directors’ Remuneration Policy

For1,2

Against1

Votes withheld1

Number
486,343,685
483,902,686

%
97.67
96.33

Number
16,758,981
18,425,092

%
3.33
3.67

Number
12,334
431,643

1  Votes ‘For’ and ‘Against’ are expressed as a percentage of votes cast. A ‘Vote withheld’ is not a vote in law.
2  Votes ‘For’ includes those giving the Chairman discretion.

Governance
The Directors’ Remuneration Report has been prepared in accordance with the Large and Medium-sized Companies and Groups (Accounts 
and Reports) (Amendment) Regulations 2008 (as amended by the 2013 Regulations) the UKLA Listing Rules and the UK Corporate 
Governance Code. The Companies Act 2006 requires the auditor to report to the Company’s members on certain parts of the Directors’ 
Remuneration Report and to state whether in their opinion those parts of the report have been properly prepared in accordance with 
the regulations. 

The Remuneration Committee Chair’s statement, the Remuneration at a Glance section and certain parts of the Annual Report on 
Remuneration (indicated in that report) are unaudited. 

Remuneration Committee
Members of the Remuneration Committee during the year were: Lorraine Trainer (Chair until 13 May 2020), Angela Knight (Chair from 
13 May 2020), Edmund Ng and Michael Heaney.

Annual Report and Accounts 2020
106

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Outside directorships
Nicolas Breteau, Robin Stewart and Philip Price did not have any 
outside directorships from which they received any remuneration 
during 2020.

The alignment of Executive remuneration with wider Company 
pay policy
The employees of TP ICAP are critical to its long-term success and 
the Remuneration Committee is responsible for developing 
and maintaining formal and transparent policies on remuneration 
for the Company’s employees. 

Our philosophy on remuneration, that applies to all employees:

 > We seek to attract and retain high-performing and motivated 

employees and remunerate them with a competitive base salary.

 > We align reward with the delivery of the Group’s business 

strategy, values, key priorities and long-term goals.

 > We reward behaviours that both create sustainable results in line 
with our core values of honesty, integrity, respect and excellence 
and do not encourage excessive risk taking and are in line with 
our current risk conduct framework.

 > We align remuneration with the principle of protection of 

customers and the prevention of conflicts of interest.
 > We deliver some elements of compensation as shares in 
the Company to align senior employee, Executive and 
shareholder interests.

 > We provide standard benefits that apply across all 

employee groups.

2021 AGM
Copies of the Executive Directors’ employment contracts and the 
Non-executive Directors’ letters of appointment are available for 
inspection at the registered office of the Company during normal 
business hours and will be available for shareholders to view at the 
2021 AGM. Executive Directors have rolling contracts which may be 
terminated by either the Company or the Director giving 12 months’ 
notice. Details of the contractual arrangements for the Non-
executive Directors are set out in the Directors’ Remuneration 
Policy, available on the Company’s website.

Key responsibilities of the Committee
The Board has delegated responsibility to the Committee for:

 > working with management to formalise and approve transparent 

policies on remuneration for the Company’s employees, that 
support the Company’s long-term strategic goals and are aligned 
to it’s culture;

 > reviewing remuneration policies to ensure compliance with 

corporate governance and regulatory requirements;

 > ensuring implementation of the Company’s remuneration policies 

is subject to review;

 > considering relationships between incentives and risk to ensure 
that risk management and appetite are properly considered in 
setting and implementing the remuneration policy;

 > reviewing wider workforce pay and considering mechanisms for 
explaining to the workforce how executive pay and any related 
policies are aligned with remuneration for the wider workforce;
 > keeping under review the Company’s gender and ethnic pay gaps 

and overseeing the implementation of actions identified as 
being required;

 > ensuring Executive Director remuneration is in line with the most 
recent Directors’ Remuneration Policy and that wider workforce 
pay has been considered when setting Executive pay;

 > setting appropriately challenging incentive targets for the 

Executive Directors;

 > ensuring risk management events are reflected in 

remuneration outcomes;

 > determining and approving the rules of any new employee share 
scheme or other equity-based long-term incentive programme or 
any new performance related pay schemes and total annual 
payments under such schemes; and

 > reviewing and approving after consultation with the 

Chief Executive, the level and structure of remuneration 
for senior management.

Key Remuneration Committee activities in 2020 
The Committee’s focus areas this year were:

 > assessing the 2019 performance of the Executive Directors 
against the financial and personal non-financial metrics;
 > determining the financial metrics used to assess 70% of the 

Executive Directors’ 2020 Bonus and the performance ranges for 
the LTIP award made in 2020;

 > setting specific 2020 Strategic performance objectives for each 
of the Executive Directors in order to assess 30% of their 2020 
Bonus;

 > establishing share schemes for the 2020 share awards as part of 

the redomiciliation project;

 > benchmarking the remuneration of the Executive Directors;
 > reviewing risk-adjusted reward procedures to ensure conduct and 

culture are considered in all reward decisions;

 > reviewing the Company’s FCA Remuneration Policy Statement 
and undertaking a review of its Remuneration Code Staff; and

 > undertaking a full review of remuneration below Board and 

senior management level.

Annual Report and Accounts 2020
107

 
 
 
 
 
 
 
Report of the Remuneration Committee
continued

Implementation of Remuneration Policy in 2021
Executive Directors 
The Executive Directors’ salaries have been increased effective 
January/April 2021 as disclosed on page 98.

Until the intended EGM, the annual bonus will continue to be based 
on the existing scorecard of financial and strategic performance 
targets aligned to the business strategy, conduct and risk KPIs, with 
no change to the maximum bonus opportunities of 2.5x base salary 
and 2x base salary for the Chief Executive Officer and CFO/GGC 
respectively. The split between financial and strategic performance 
targets will, for 2021, be 70% financial targets and 30% strategic 
targets. Details of targets are deemed to be commercially sensitive 
and will be disclosed retrospectively in the next Directors’ 
Remuneration Report. 50% of the total bonus awarded will be 
deferred into shares vesting after three years. 

As outlined on page 94 the Committee has decided not to award 
a 2021 LTIP but will commence consultation with shareholders over 
a new Remuneration Policy in the coming months with the intention 
of holding an EGM by the autumn to approve the new policy, 
including the grant of a 2021 long-term incentive.

Advice provided to the Remuneration Committee 
During 2020, PricewaterhouseCoopers provided external 
remuneration advice to the Remuneration Committee. They 
advised on aspects of our Remuneration Policy and practice, 
including the benchmarking of Directors’ compensation, trends in 
market practice and regulatory disclosures. PricewaterhouseCoopers 
was appointed by the Remuneration Committee, initially in 
November 2018 to provide advice to the Remuneration Committee 
on the development of the new Directors’ Remuneration Policy and 
was subsequently appointed as the sole advisor to the Committee. 
In addition, PricewaterhouseCoopers provided tax advice to the 
Company. PricewaterhouseCoopers is a signatory to the 
Remuneration Consultants Group Code of Conduct which requires 
it to provide objective and impartial advice. 

The Remuneration Committee is satisfied that the PwC 
engagement partner and team, which provide remuneration 
advice to the Committee, do not have connections with TP ICAP 
that might impair their independence or objectivity. The fees 
payable for advice provided by PricewaterhouseCoopers in 2020 
were £162,965 (excluding VAT). Fees are charged on a time and 
materials basis, other than when a scope of fees is provided for 
services upfront. The Committee is satisfied that these fees are 
appropriate for the work undertaken. 

Allen & Overy LLP provided advice on law and regulation in 
relation to employee incentive matters. This firm also provided 
general legal advice to the Company. Advice was also provided on 
occasion by the CEO, CFO, Group General Counsel, Group Head of 
HR and CRO.

Approved by the Board and signed on its behalf by

Angela Knight
Interim Chair 
Remuneration Committee 
9 March 2021

Annual Report and Accounts 2020
108

Directors’ report

The Directors present their report together with the audited consolidated Financial Statements for the year ended 31 December 2020.

As permitted by legislation, the following statements made pursuant to company law, the UK Listing Authority’s Listing Rules, Disclosure 
Guidance and Transparency Rules are set out elsewhere in this Annual Report and are incorporated into this report by reference:

Disclosure
Board of Directors
Results for the year
Dividends
DTR 7 Corporate Governance Statement (excluding DTR 7.2.6,  
which is covered by this Directors’ report)
How the Directors have engaged with and had regard to 
employees
How the Directors have had regard to the need to foster business 
relationships with stakeholders
Directors’ share interests
Financial instruments
Viability statement
Going concern statement
Principal risks and uncertainties
Human rights and equal opportunities
Related party transactions
Business activities and performance
Financial position
Key risk analysis
Loans and other provisions

Issued share capital
Future developments
Statement of Directors’ responsibilities

Location
Board of Directors (pages 66 to 67)
Consolidated Income Statement (page 124)
Strategic Report (front cover)
Corporate governance report (page 62 to 63)

Corporate governance report (pages 72 to 73)

Corporate governance report (pages 74 to 75)

Report of the Remuneration Committee (page 104)
Note 28 to the Consolidated Financial Statements (pages 162 to 167)
Strategic Report (page 43)
Strategic Report (page 43)
Strategic Report (pages 46 to 49)
Strategic Report (pages 50 to 55)
Note 38 to the Consolidated Financial Statements (page 181)
Strategic Report (pages 6 to 42)
Strategic Report (pages 28 to 41)
Strategic Report (pages 46 to 49)
Notes 3, 24 and 26 to the Consolidated Financial Statements  
(pages 130, 159 and 161)
Note 29 to the Consolidated Financial Statements (page 167)
Strategic report (pages 9 to 25)
Page 113

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Listing Rule 9.8.4 disclosure
The trustee of the Employee Benefit Trust waived its rights to receive dividends on shares held by them. Information regarding long-term 
incentive schemes is contained within the Report of the Remuneration Committee (pages 92 to 108) and incorporated into this report by 
reference. Otherwise than as indicated, there are no further disclosures to be made under Listing Rule 9.8.4.

Post balance sheet events
Following the loss of the EU passporting rights as a result of the UK’s withdrawal from the EU, TP ICAP’s UK-based authorised subsidiaries 
no longer have the full scope of necessary regulatory permissions to service all clients based in the EU 27. TP ICAP’s UK-based authorised 
subsidiaries continue to service clients based in certain EU 27 member states where possible under available temporary permission 
regimes, existing third country access rights, or as otherwise permitted by applicable laws and regulations. In those EU 27 member states 
where TP ICAP’s existing operating model does not allow it to service clients under available temporary permission regimes, existing third 
country access rights, or applicable laws and regulations, TP ICAP is adjusting its operating model to ensure that it services clients in those 
jurisdictions in accordance with such temporary permission regimes, existing third country access rights, or applicable law and regulation. 
Such adjustments include, amongst other things, obtaining additional third country permissions for its UK authorised firms and servicing 
clients from its EU establishments once a sufficient number of brokers have been relocated from the UK.

On 1 February 2021 shareholders approved:

 > the introduction of a new Jersey incorporated holding company, TP ICAP Group plc (New TP ICAP) by means of a Scheme of 

Arrangement; and

 > The acquisition of Liquidnet Holdings, Inc.

On 2 February 2021 the Company allotted pursuant to a rights issue and admitted 225,334,552 new ordinary shares of 25 pence each, nil 
paid, to trading on London Stock Exchange plc’s main market for listed securities. 

On 24 February 2021, the High Court of England and Wales approved the Scheme of Arrangement pursuant to which TP ICAP Group plc 
would become the new holding company of the TP ICAP Group and the Company’s immediate parent. On 26 February 2021, following 
delivery of the Court order sanctioning the Scheme of Arrangement, the Scheme of Arrangement become effective and the TP ICAP 
Ordinary Shares were delisted from, and New TP ICAP Ordinary Shares were listed on, in each case the premium listing segment of the 
Official List and to trading on the London Stock Exchange plc’s main market for listed securities. TP ICAP Group plc therefore replaced the 
Company as the ultimate parent entity of the TP ICAP Group. On 8 March 2021 the Company was re-registered as a private limited 
company. 

Annual Report and Accounts 2020
109

 
 
 
 
 
 
 
Directors’ report 
continued

Directors 
The biography for each of the current Directors is set out on pages 66 to 67. Each of these Directors served throughout the year except for:

 > Angela Crawford-Ingle and Mark Hemsley, who were appointed to the Board of Directors on 16 March 2020; and 
 > Tracy Clarke and Kath Cates who were appointed since the end of the year on 1 January 2021 and 1 February 2021, respectively.

Lorraine Trainer resigned from the Board on 13 May 2020.

With regard to the appointment and replacement of Directors, the Company is governed by its Articles of Association (the ‘Articles’), 
the Companies Act 2006 and related legislation. The Articles may be amended by special resolution of the shareholders and were last 
amended in February 2021. The Articles provided that, at each AGM, all the Directors who held office on the date seven days before the 
Notice of that AGM must retire from office and each Director wishing to continue to serve must submit themselves for election or re-election 
by shareholders. The Articles of TP ICAP Group plc include a similar provision, in line with the UK Corporate Governance Code and, in 
accordance with corporate governance requirements, having served TP ICAP for nine years, Angela Knight and Roger Perkin have 
indicated their intention to step down and accordingly will not be seeking re-election at the AGM.

Directors’ conflicts
The Directors are required to notify the Company of any potential conflicts of interest that may affect them in their roles as Directors of 
TP ICAP. All new potential conflicts of interest are recorded and reviewed by the full Board as they arise, and the Register of Conflicts and 
Relevant Situations is reviewed at each scheduled meeting of the Nominations & Governance Committee.

Directors’ indemnity arrangements
The Company maintains liability insurance for its Directors and officers and, to the extent allowed by law and the Company’s Articles of 
Association, the Company provides a standard indemnity against certain liabilities that Directors may incur in their capacity as a Director 
of the Company. The liability insurance provided to a Director does not provide cover in the event a ruling of actual dishonest or fraudulent 
activity is found. A similar indemnity has been provided by TP ICAP Group plc to the extent allowed by Jersey law. The principal employer 
of the Tullett Prebon Pension Scheme has given indemnities to the Directors who are trustees of that Scheme.

Share capital and control
The Company has one class of ordinary shares, which carry no right to fixed income. Each share carries the right to one vote at general 
meetings of the Company. No shareholder has any special rights of control over the Company’s share capital and all issued shares are fully 
paid. The voting rights of the ordinary shares held by the Tullett Prebon plc Employee Benefit Trust 2007 are exercisable by the trustees in 
accordance with their fiduciary duties. The right to receive dividends on these shares has been waived. Details of employee share schemes 
are set out in Note 31 to the Consolidated Financial Statements.

Restriction on transfer of securities
There are no specific restrictions on the size of a holding nor on the transfer of shares, both of which are governed by the provisions in the 
Articles and prevailing legislation. The Directors are not aware of any agreements between holders of the Company’s shares that may 
result in restrictions on the transfer of securities or on voting rights, nor are there any arrangements by which, with the Company’s 
co-operation, financial rights carried by securities are held by a person other than the holder of those securities.

Powers of the Directors
The Directors were granted at the 2020 AGM the authority to allot shares and to buy the Company’s shares in the market up to a maximum 
of approximately 10% of its issued share capital. At the last AGM, resolutions were passed to authorise the Directors to allot up to a 
nominal amount of £93,889,396.50 (subject to restrictions specified in the relevant resolutions) and to purchase up to 56,333,638 
ordinary shares.

During 2020 no shares were purchased in the market under the authority granted at the 2020 AGM. On 2 February 2021 the Company 
allotted 225,334,552 ordinary shares pursuant to a rights issue. 

Significant agreements and change of control
The Company’s banking facilities give the lenders the right not to renew loans and to cancel commitments in the event of a change of control. 
The Company’s lenders were therefore engaged in the lead up to the Scheme of Arrangement. The Company’s share schemes contain 
provisions relating to change of control, subject to the satisfaction of relevant performance conditions and pro-rata for time, if appropriate. 
As a consequence of the recent reorganisation and the Scheme of Arrangement TP ICAP Group plc has assumed the awards under the share 
schemes. The Company is not aware of any other significant agreements that take effect, alter or terminate upon a change of control of the 
Company following a takeover bid, nor any agreements with the Company and its employees or Directors for compensation for loss of office 
or employment that occurs because of a takeover bid. 

Research and development
The Group uses various bespoke information technology in the course of its business and undertakes research and development in order 
to enhance that technology.

Employees
The Group is an inclusive employer and considers diversity to be of utmost importance. We give full and fair consideration to applications 
we receive from disabled persons and support those who incur a disability whilst employed at the Group. All opportunities of career 
progression and development, including promotions and training, are equally applied to all employees.

Annual Report and Accounts 2020
110

All employees receive information of relevance to them and factors affecting the Group’s performance through emails and our regular 
Group-wide newsletter, The Wire. The Group consults employees, taking into account their views in the Board’s decision making processes, 
using surveys to encourage employee involvement in the Company’s performance. This is supplemented by the workforce engagement 
programme, in which Mark Hemsley, Edmund Ng and Michael Heaney have been commissioned to represent the Board in engaging with 
the workforce in EMEA, Asia Pacific and the Americas respectively. For more information on the progress made over the course of 2020, 
see pages 72 to 73.

Political donations
It is the Company’s policy not to make cash contributions to any political party. However, within the normal activities of the Group, there 
may be occasions when an activity might fall within the broader definition of ‘political expenditure’ contained within the Companies Act 
2006. Therefore, the Company has sought to obtain shareholder authority to make limited political donations at each AGM. During 2020, 
no political donations were made by the Group (2019: £nil).

Statement of Directors’ responsibilities 
The Directors’ Statement regarding their responsibility for preparing the Annual Report is set out on page 113.

Substantial shareholders
The following table shows the holdings of the Company’s total voting rights attached to the Company’s issued ordinary share capital, 
that were notified to the Company in accordance with DTR 5 as at 31 December 2020, together with information on further notifications 
received by the Company or TP ICAP Group plc, as applicable, as at the date of this Annual Report.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Schroders plc
Jupiter Asset Management
Liontrust Asset Management
Silchester International Investors LLP
Blackrock, Inc.
Ameriprise Financial Inc.

31 December 
2020 
% 
12.42
8.85
5.07
5.04
4.85
–

9 March 
2021
%
11.53
8.85
5.07
5.04
4.85
5.13

Greenhouse gas emissions 
TP ICAP, as an office-based business, is not engaged in activities that are generally regarded as having a high environmental impact 
However, the Board has agreed that it will seek to adopt policies to safeguard the environment to meet statutory requirements or where 
such policies are commercially sensible.

The emission of greenhouse gases result from office-based business activities and business travel, is the Company’s main environmental 
impact and statistics relating to these emissions are set out in the Directors’ report. The below table and supporting narrative summarise 
the Streamlined Energy and Carbon Reporting (SECR) disclosure in line with the requirements for a quoted company, as per The Companies 
(Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. The disclosure also extends beyond 
the scope of a quoted company and includes emissions and energy consumption from business travel via air and taxi (Scope 3).

Global GHG emission data for the period: 2020

Emission Source
Emissions from activities for which the Company own or control including 
combustion of fuel and operation of facilities (Scope 1) (tCO2e)
Emissions from purchase of electricity, heat, steam and cooling purchased 
for own use (Scope 2) (tCO2e)
Emissions from business travel via air and taxi (Scope 3) (tCO2e) 
Total gross Scope 1, Scope 2 and Scope 3 emissions (tCO2e)
Energy consumption used to calculate Scope 1 emissions (kWh)
Energy consumption used to calculate Scope 2 emissions (kWh)
Energy consumption used to calculate Scope 3 emissions (kWh)
Total energy consumption based on the above (kWh)
Intensity ratio: tCO2e (gross Scope 1, 2 + 3) per employee

Current reporting year
1 January 2020 – 31 December 2020

Comparison reporting year
1 January 2019 – 31 December 2019

UK
475

Global  
(excluding UK)
297

UK
421

Global  
(excluding UK)
551

4,421

4,107

1,937

4,595

300
5,196
2,584,497
5,439,505
1,157,271
9,181,274

477
4,880
1,480,384
4,855,965
1,866,947
8,203,296

1,281
3,638
595,047
7,837,991
5,142,135
13,575,173

2,385
7,598
2,747,545
9,448,303
9,599,074
21,794,922

2.0

2.3

Methodology 
Anthesis has calculated the above greenhouse gas emissions estimates to cover all material sources of emissions for which the Group is 
responsible. The methodology used was that of the ‘Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (revised 
edition, 2015)’. Responsibility for emissions sources was determined using the operational approach. All emission sources required under 
the ‘Companies, Partnerships and Groups (Accounts and non-financial reporting) Regulations 2016 ‘ are included. 

Annual Report and Accounts 2020
111

 
 
 
 
 
 
 
Directors’ report 
continued

This estimate covers all the Group’s operations that are consolidated in the financial statement and the offices leased to conduct these 
operations. Data has been collected from representative sites of different sizes in each region, and where data was not available, energy 
consumption was calculated based on floor area extrapolation from similar operations to estimate the consumption across the rest of 
the Group’s global operations. Data was collected for the Group’s managed or owned transport activity, and business travel, specifically 
in relation to travel via air and taxi. Activity data was then converted to greenhouse gas estimates using the UK Government’s GHG 
Conversion Factors for Company Reporting 2020 and the International Energy Agency’s (IEA) Overseas Electricity factors from 2020 
for overseas electricity consumption. 

Energy Efficiency Action
Due to the COVID-19 pandemic TP ICAP have made few improvements to energy efficiency within the financial year; however, TP ICAP 
have made efforts to remove a lot of redundant technology kit within their data suites.

Auditor
Deloitte LLP have expressed their willingness to continue in office as auditor and a resolution to re-appoint them will be proposed at the 
forthcoming AGM.

Disclosure of information to the auditor
Each of the persons who is a Director at the date of approval of this Annual Report confirms that:

 > so far as the Director is aware, there is no relevant audit information of which the Company’s auditor is unaware; and
 > the Director has taken all steps that he/she ought to have taken as a Director in order to make himself/herself aware of any relevant audit 

information and to establish that the Company’s auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

Annual General Meeting 
An Annual General Meeting of TP ICAP Group plc will be held at 2.15pm on 12 May 2021. The Company’s Annual Report and Accounts will 
be presented to shareholders at the TP ICAP Group plc AGM, together with the financial statements of TP ICAP Group plc. The Company’s 
Annual Report and Accounts will also be presented for approval by the Company’s sole shareholder, TP ICAP Group plc, later in 2021. 
Details of the resolutions to be proposed at the TP ICAP Group plc AGM are set out in a separate Notice of Meeting together with 
explanatory notes set out in a separate circular. The Notice of this Meeting will be sent to all shareholders of TP ICAP Group plc entitled to 
receive such notice. Only members on the register of members of TP ICAP Group plc as at close of business on 10 May 2021 (or two days 
before any adjourned meeting, excluding non-business days) will be entitled to attend and vote at the AGM. Any proxy must be lodged 
with TP ICAP Group plc’s registrars or submitted to CREST at least 48 hours, excluding non-business days, before the AGM or any adjourned 
meeting thereof.

Approved by the Directors and signed on behalf of the Board.

Richard Cordeschi
Group Company Secretary
9 March 2021

Annual Report and Accounts 2020
112

Statement of Directors’ responsibilities

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a

l

s
t
a
t
e
m
e
n
t
s

Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report, the Directors’ Remuneration Report and the Financial Statements in 
accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors are required to 
prepare the Group financial statements in accordance with international accounting standards in conformity with the requirements of the 
Companies Act 2006 and International Financial Reporting Standards (‘IFRS’) adopted pursuant to Regulation (EC) No 1606/2002 as it 
applies in the European Union.

Under company law, the Directors must not approve the accounts unless they are satisfied that they give a true and fair view of the state 
of affairs of the Company and of the profit or loss of the Company for that period.

In the case of Group Financial Statements, IAS 1 requires that Directors:

 > select and apply accounting policies properly;
 > present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable 

information;

 > provide additional disclosures when compliance with the specific requirements in IFRS are insufficient to enable users to understand the 

impact of particular transactions, other events and conditions on the entity’s financial position and financial performance; and

 > make an assessment of the Company’s ability to continue as a going concern.
 > In the case of the Parent Company Financial Statements, the Directors are required to:
 > select suitable accounting policies and apply them consistently;
 > make judgements and estimates that are reasonable and prudent;
 > state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in 

the Financial Statements; and

 > prepare the Financial Statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions 
and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the Financial 
Statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for 
taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s 
website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from 
legislation in other jurisdictions.

Responsibility statement
Each of the Directors, whose names and functions are listed in the Corporate governance report on pages 66 to 67 and who are Directors 
as at the date of this Statement of Directors’ responsibilities, confirm to the best of their knowledge that:

 > the Financial Statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the 
assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as 
a whole;

 > the Strategic report includes a fair review of the development and performance of the business and the position of the Company and the 
undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that it 
faces; and

 > the Annual Report and Financial Statements, taken as a whole, are fair, balanced and understandable and provide the information 

necessary for shareholders to assess the Company’s position, performance, business model and strategy.

On behalf of the Board.

Nicolas Breteau
Chief Executive Officer 
9 March 2021

Annual Report and Accounts 2020
113

 
 
 
 
 
 
 
Independent Auditor’s Report to the members of TP ICAP Limited  
(formerly ‘TP ICAP PLC’)

2. Basis for opinion
We conducted our audit in accordance with International 
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our 
responsibilities under those standards are further described in the 
auditor’s responsibilities for the audit of the financial statements 
section of our report. 

We are independent of the group and the parent company in 
accordance with the ethical requirements that are relevant to our 
audit of the financial statements in the UK, including the Financial 
Reporting Council’s (the ‘FRC’s’) Ethical Standard as applied to 
listed public interest entities, and we have fulfilled our other ethical 
responsibilities in accordance with these requirements. The 
non-audit services provided to the group and parent company for 
the year are disclosed in note 5 to the financial statements. We 
confirm that the non-audit services prohibited by the FRC’s Ethical 
Standard were not provided to the group or the parent company.

Report on the audit of the financial statements

1. Opinion

In our opinion:

 > the financial statements of TP ICAP Limited (the ‘parent 

company’) and its subsidiaries (the ‘group’) give a true and fair 
view of the state of the group’s and of the parent company’s 
affairs as at 31 December 2020 and of the group’s profit for 
the year then ended;

 > the group financial statements have been properly prepared 
in accordance with international accounting standards in 
conformity with the requirements of the Companies Act 2006, 
and International Financial Reporting Standards (IFRSs) as 
adopted by the European Union;

 > the parent company financial statements have been properly 

prepared in accordance with United Kingdom Generally 
Accepted Accounting Practice, including Financial Reporting 
Standard 101 “Reduced Disclosure Framework”; and

 > the financial statements have been prepared in accordance 

with the requirements of the Companies Act 2006.

We have audited the financial statements which comprise:

 > the consolidated income statement;
 > the consolidated statement of comprehensive income;
 > the consolidated and parent company balance sheets;
 > the consolidated and parent company statements of changes 

in equity;

 > the consolidated cash flow statement;
 > the related consolidated financial statement noted 1 to 40; and
 > the related parent company financial statement notes 1 to 11.

The financial reporting framework that has been applied in the 
preparation of the group financial statements is applicable law, 
and international accounting standards in conformity with the 
requirements of the Companies Act 2006, and IFRSs as adopted by 
the European Union. The financial reporting framework that has 
been applied in the preparation of the parent company financial 
statements is applicable law and United Kingdom Accounting 
Standards, including FRS 101 “Reduced Disclosure Framework” 
(United Kingdom Generally Accepted Accounting Practice).

Annual Report and Accounts 2020
114

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

3. Summary of our audit approach

Key audit matters

The key audit matters that we identified in the current year were:

Materiality

Scoping

Significant changes in our 
approach

 > Name Passing revenue
 > Impairment of goodwill
The materiality that we used for the group financial statements was £9.2m which was determined with 
reference to the underlying profit before tax.
Our Group audit scope focused primarily on 5 locations (2019: 6 locations) with 18 subsidiaries 
(2019: 28 subsidiaries) subject to a full scope audit and 6 subsidiaries (2019: 5 subsidiaries) subject to 
specified audit procedures.

In aggregate, these subsidiaries represent the principal business units within each of the Group’s operating 
segments. These subsidiaries account for 96% (2019: 98%) of the Group’s total assets, 98% (2019: 98%) 
of the Group’s total liabilities, 81% (2019: 88%) of the Group’s revenue and 78% (2019: 85%) of the 
Group’s expenses.
Over the years, the Group has rationalised its structure resulting in fewer subsidiaries largely contributing to 
the Group’s results. As a result of this, our selection of subsidiaries subject to full scope audit and specified 
audit procedures has changed. 

We also no longer identify a key audit matter in relation to the presentation and disclosure of integrated 
related items as the Group completed its integration of ICAP in 2019. We identified no additional risk on the 
presentation of the income statement in the current year as the Group has changed its presentation of the 
income statement to a single columnar approach to show reported profit. 

All other key audit matters are consistent with the prior year. There have been no other significant changes 
to our audit approach compared to prior year.

4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation 
of the financial statements is appropriate.

Our evaluation of the directors’ assessment of the group’s and parent company’s ability to continue to adopt the going concern basis of 
accounting included:

 > Challenging the underlying data and key assumptions used to make the assessment, including cash flow forecasts, impact of the 

proposed acquisition of Liquidnet Holdings Inc and its subsidiaries and the impact of Covid-19;

 > Performing stress tests in relation to key assumptions; 
 > Evaluating the directors’ plans for future actions, including evaluating the feasibility of the mitigating actions that they control, 

in relation to their going concern assessment; and 

 > Considering the Group’s forecasts in the context of the ongoing Brexit readiness plan and the potential impact of the Group’s delay 

in relocating staff to EU member states and, therefore, the loss of EU passporting rights.

For the company only financial statements of the parent company, we inspected board minutes and other relevant strategy documents to 
understand the future plans for the parent company following the announcement that the Scheme of Arrangement became effective on 
26 February 2021 and TP ICAP Group plc became the new parent company of the group. We also assessed the confirmation from the 
directors of TP ICAP Group plc, who are also the directors of the parent company, that they will continue to support the parent company to 
allow it to continue as a going concern for at least 12 months from the date of approval of the financial statements. Based on the work we 
have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may 
cast significant doubt on the group’s and parent company’s ability to continue as a going concern for a period of at least twelve months 
from when the financial statements are authorised for issue.

On the Group ‘s application of the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to 
the directors’ statement in the financial statements about whether the directors considered it appropriate to adopt the going concern 
basis of accounting.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Annual Report and Accounts 2020
115

 
 
 
 
 
 
 
Independent Auditor’s Report to the members of TP ICAP Limited (formerly ‘TP ICAP PLC’)
continued

5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements 
of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we 
identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the 
audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, 
and we do not provide a separate opinion on these matters.

5.1. Name Passing revenue
Refer to the summary of significant accounting policies on page 130 and “Our business model” on page 6.

Key audit matter 
description

Name Passing revenue is earned for the service of matching buyers and sellers of financial instruments. 
The Group is not a counterparty to the trade and commissions are invoiced for the service provided by 
the Group. 

It is the largest revenue stream of the Group and accounts for approximately 70% of the Group’s revenue 
and so a significant amount of audit time is utilised on this area. It also has a longer cash collection period 
than the other revenue streams of the Group. Revenue associated with past due trade debtors was £90.2m 
(89% of total trade debtors) at 31 December 2020. 

How the scope of our audit 
responded to the key 
audit matter

We identified a risk of material misstatement of revenue, due to fraud or error, related to revenue incurred 
during the year but remain unpaid for 60 or more days as at year-end. 
We obtained an understanding of relevant controls relating to Name Passing invoicing and cash collection. 
The Group’s control environment continues to be decentralised and reliant on manual processes, and there 
are improvements required to the IT environment. As a result we did not adopt a controls reliance approach.

We agreed a sample of Name Passing transactions, which were outstanding at year-end, to cash received 
post year-end or where amounts remained unpaid to other evidence to corroborate the validity of the 
revenue booked. 

Key observations

We reviewed communications with counterparties and tested a sample of post year-end trade adjustments 
and credit notes to evaluate whether these items were accurate and valid.
Our substantive procedures were completed satisfactorily. We consider Name Passing revenue incurred 
during the year, but remaining unpaid for 60 or more days as at year-end, to be appropriate. 

Annual Report and Accounts 2020
116

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

5.2. Impairment of goodwill
Refer to the Audit Committee’s report on page 85, the summary of significant accounting policies on page 132, accounting estimates and 
judgements on page 140 and the intangible assets arising on consolidation note on page 148.

Key audit matter 
description

As required by IAS 36, goodwill is reviewed for impairment at least annually. The Group has changed its 
annual impairment assessment from 31 December to 30 September and annually thereafter. Determining 
whether the goodwill of £998m is impaired requires an estimation of the recoverable amount of the 
Group’s cash generating units (“CGUs”), or a group of CGUs, using the higher of the value in use or fair value 
less costs to sell.

How the scope of our audit 
responded to the key 
audit matter

Key observations

The value in use approach was used to assess the recoverable amount of the EMEA, Americas and APAC 
Group of CGUs.

The value in use approach involves an estimation of future cash flows arising for the CGUs or group of CGUs 
and hence requires the selection of suitable discount rates and forecast future growth rates. It is therefore 
inherently subjective with an increased risk of material misstatement due to error or fraud. The value in use 
of each CGU or group of CGU can be sensitive to changes in underlying assumptions. We focused our testing 
on the EMEA CGU cashflows, due to the impact of Brexit, and the Asia Pacific CGU which was sensitive 
to the forecast future growth rate. Management have also assessed for impairment triggers between 
30 September 2020 and 31 December 2020 and concluded no impairment triggers were identified. 

An impairment of £21m was recorded in the year for the Asia Pacific CGU.
We obtained an understanding of relevant controls relating to the impairment of goodwill. 

We performed detailed analysis of the Group’s assumptions used in the annual impairment review, 
in particular the cashflow projections, forecast future growth rates, and discount rates used by the Group 
in its impairment tests of the group of CGUs. We challenged cash flow projections and growth rates by 
evaluating recent performance, trend analysis and comparing growth rates to those achieved historically 
and to external market data where available. 

We have also assessed the impact of the UK based subsidiaries losing their regulatory permissions to service 
clients in a number of EU countries subsequent to the UK leaving the EU on the EMEA CGU cashflows. 

We worked with our internal valuations specialists to independently derive discount rates which we 
compared to the rates used by the Group and we benchmarked discount rates to available external peer 
group data.

We performed scenario analysis, flexed key assumptions, assessed for impairment triggers between 
30 September 2020 and 31 December 2020, and considered the appropriateness of the disclosures in the 
notes to the financial statements.
We concluded that the directors’ valuation used in the impairment test and the recognition of an 
impairment charge in respect of the Asia Pacific CGUs was appropriate.

The cash flow forecasts used in the annual impairment review were consistent with the most recent 
financial budgets approved by the Board and were reasonable in the context of recent business 
performance. The growth rates used by management were reasonable. 

We identified the discount rate for the EMEA CGU was not within the reasonable range calculated by our 
internal valuation specialist, however, the recoverable value of the EMEA CGU is not sensitive to a 
reasonable possible change in discount rates. We concurred with the directors’ conclusion that no 
impairment was required. 

Annual Report and Accounts 2020
117

 
 
 
 
 
 
 
Independent Auditor’s Report to the members of TP ICAP Limited (formerly ‘TP ICAP PLC’)
continued

6. Our application of materiality
6.1. Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of 
a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and 
in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Materiality
Basis for determining 
materiality

Group financial statements
£9.2m (2019: £9.6m)
We have used 5% of normalised profit based tax 
as a basis for determining materiality. We have 
determined adjusted profit before tax of £184m as 
profit before tax of £223m less amortisation of 
intangible assets arising on consolidation of £39m. 
Amortisation of intangible assets arising on 
consolidation is a recurring cost and therefore 
reflects ongoing business performance. 

Parent company financial statements
£4.6m (2019: £4.8m)
For the 2020 Parent company financial statements, 
we have determined our materiality to be £4.6m. 
This equates to 50% of Group materiality and less 
than 1% of Parent Company total equity.

Rationale for benchmark 
applied

Materiality equates to less than 1% of total equity. 
In determine the Group materiality, we considered a 
number of factors, including the needs and interest of 
the users of the Group financial statements. In our 
view, an adjusted underlying profit before tax is 
a more stable metric for group profitability.

In determining Parent company materiality, we 
considered a number of factors including Group 
materiality and performance materiality and the 
relative significance of the Parent Company to 
the Group.

6.2. Performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected 
misstatements exceed the materiality for the financial statements as a whole. 

Performance materiality
Basis and rationale for 
determining performance 
materiality

Group financial statements
65% (2019: 70%) of group materiality
In determining performance materiality we considered that the control environment remains decentralised 
and reliant on manual processes, and that improvements are required to the information technology 
environment. We also considered the increased operational risk in relation to the COVID-19 pandemic, 
including the move to remote working. We also considered:

Parent company financial statements
65% (2019: 70%) of parent company materiality 

 > our past experience of the audit, which has indicated a low number uncorrected misstatements identified 

in prior periods; and

 > our risk assessment, which has indicated no changes in the business that could affect our ability to 

forecast potential misstatements.

Annual Report and Accounts 2020
118

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

6.3. Error reporting threshold
We agreed with the Audit Committee that we would report to the 
Committee all audit differences in excess of £0.5m (2019: £0.5m), as 
well as differences below that threshold that, in our view, warranted 
reporting on qualitative grounds. We also report to the Audit 
Committee on disclosure matters that we identified when assessing 
the overall presentation of the financial statements.

Revenue 
%

Full scope
Speciﬁed audit procedures
Analytical review

75
06
19

7. An overview of the scope of our audit
7.1. Identification and scoping of components
Our Group audit scope focused primarily on 5 locations 
(2019: 6 locations) with 18 subsidiaries (2019: 28 subsidiaries) 
subject to a full scope audit and 6 subsidiaries (2019: 5 subsidiaries) 
subject to specified audit procedures.

These subsidiaries account for 96% (2019: 98%) of the Group’s total 
assets, 98% (2019: 98%) of the Group’s total liabilities, 81% (2019: 
88%) of the Group’s revenue and 78% (2019: 85%) of the Group’s 
expenses. Over the years, the Group has rationalised its structure 
resulting in fewer subsidiaries largely contributing to the Group’s 
results. As a result of this, our selection of subsidiaries subject to full 
scope audit and specified audit procedures has changed. There 
have been no other significant changes to our audit approach 
compared to prior year. 

The subsidiaries were selected based on their quantitative 
contribution to the Group and qualitative risk factors. Our audits 
of each of the subsidiaries were performed using lower levels 
of materiality based on their size relative to the Group. The 
materiality for each subsidiary audit ranged from £2.9m to £3.6m.
We tested the Group’s consolidation process and carried out 
analytical procedures to confirm that there were no significant risks 
of material misstatement in the aggregated financial information 
of the remaining subsidiaries not subject to a full scope audit or 
specified audit procedures.

Annual Report and Accounts 2020
119

Expenses 
%

Assets 
%

Liabilities 
%

Full scope
Speciﬁed audit procedures
Analytical review

72
06
22

Full scope
Speciﬁed audit procedures
Analytical review

96
00
04

Full scope
Speciﬁed audit procedures
Analytical review

98
00
02

 
 
 
 
 
 
 
Independent Auditor’s Report to the members of TP ICAP Limited (formerly ‘TP ICAP PLC’)
continued

7.2. Our consideration of the control environment 
The Group uses a number of different IT systems across components 
and we worked with our IT specialists to assess General IT controls 
for relevant systems. The control environment remains 
decentralised, reliant on manual processes with improvements 
required to the IT environment in order for us to adopt a controls 
reliance approach. Management continue to implement 
improvements to the existing environment.

7.3. Working with other auditors
The Group audit team maintained dialogue with all component 
auditors throughout all phases of the audit and received written 
reports from component auditors setting out the results of their 
audit procedures. The Senior Statutory Auditor met with key 
members of overseas management remotely. The Group audit team 
performed a remote file review of the work performed by all 
component auditors. 

8. Other information
The other information comprises the information included in the 
annual report including the Strategic report and the Governance 
report, other than the financial statements and our auditor’s report 
thereon. The directors are responsible for the other information 
contained within the annual report. Our opinion on the financial 
statements does not cover the other information and, except to the 
extent otherwise explicitly stated in our report, we do not express 
any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, 
consider whether the other information is materially inconsistent with 
the financial statements or our knowledge obtained in the course of 
the audit, or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material 
misstatements, we are required to determine whether this gives rise 
to a material misstatement in the financial statements themselves. 
If, based on the work we have performed, we conclude that there is 
a material misstatement of this other information, we are required 
to report that fact.

We have nothing to report in this regard.

9. Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, 
the directors are responsible for the preparation of the financial 
statements and for being satisfied that they give a true and fair 
view, and for such internal control as the directors determine is 
necessary to enable the preparation of financial statements that 
are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible 
for assessing the group’s and the parent company’s ability to 
continue as a going concern, disclosing as applicable, matters 
related to going concern and using the going concern basis of 
accounting unless the directors either intend to liquidate the group 
or the parent company or to cease operations, or have no realistic 
alternative but to do so.

10. Auditor’s responsibilities for the audit of the 
financial statements
Our objectives are to obtain reasonable assurance about whether the 
financial statements as a whole are free from material misstatement, 
whether due to fraud or error, and to issue an auditor’s report that 
includes our opinion. Reasonable assurance is a high level of 
assurance, but is not a guarantee that an audit conducted in 
accordance with ISAs (UK) will always detect a material 
misstatement when it exists. Misstatements can arise from fraud or 
error and are considered material if, individually or in the aggregate, 
they could reasonably be expected to influence the economic 
decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the 
financial statements is located on the FRC’s website at: 
www.frc.org.uk/auditorsresponsibilities. This description forms 
part of our auditor’s report.

Annual Report and Accounts 2020
120

11. Extent to which the audit was considered capable 
of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance 
with laws and regulations. We design procedures in line with our 
responsibilities, outlined above, to detect material misstatements in 
respect of irregularities, including fraud. The extent to which our 
procedures are capable of detecting irregularities, including fraud 
is detailed below. 

11.1. Identifying and assessing potential risks related 
to irregularities
In identifying and assessing risks of material misstatement in 
respect of irregularities, including fraud and non-compliance with 
laws and regulations, we considered the following:

 > the nature of the industry and sector, control environment and 

business performance including the design of the Group’s 
remuneration policies, key drivers for directors’ remuneration, 
bonus levels and performance targets;

 > results of our enquiries of management, internal audit and the 

audit committee about their own identification and assessment 
of the risks of irregularities; 

 > any matters we identified having obtained and reviewed 

the Group’s documentation of their policies and procedures 
relating to:
 > identifying, evaluating and complying with laws and 

regulations and whether they were aware of any instances of 
non-compliance, including their assessment of open litigation 
and regulatory matters as disclosed in note 26 and 35; 

 > detecting and responding to the risks of fraud and whether they 

have knowledge of any actual, suspected or alleged fraud;
 > the internal controls established to mitigate risks of fraud or 

non-compliance with laws and regulations;

 > the matters discussed among the audit engagement team 
including significant component audit teams and relevant 
internal specialists, including tax, valuations, pensions and IT 
regarding how and where fraud might occur in the financial 
statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities 
and incentives that may exist within the organisation for fraud and 
identified the greatest potential for fraud in the following areas: 
Name Passing revenue and the impairment of goodwill. In common 
with all audits under ISAs (UK), we are also required to perform 
specific procedures to respond to the risk of management override.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

We also obtained an understanding of the legal and regulatory 
frameworks that the Group operates in, focusing on provisions 
of those laws and regulations that had a direct effect on the 
determination of material amounts and disclosures in the financial 
statements. The key laws and regulations we considered in this 
context included the relevant provision of the UK Companies Act 
2006, Listing rules, pensions legislation and tax legislation. 

In addition, we considered provisions of other laws and regulations 
that do not have a direct effect on the financial statements but 
compliance with which may be fundamental to the Group’s ability 
to operate or to avoid a material penalty. 

11.2. Audit response to risks identified
As a result of performing the above, we identified Name Passing 
revenue and impairment of goodwill as key audit matters related 
to the potential risk of fraud or non-compliance with laws and 
regulations. The key audit matters section of our report explains the 
matters in more detail and also describes the specific procedures 
we performed in response to those key audit matters. 

Our procedures to respond to risks identified included the following:

 > reviewing the financial statement disclosures and testing to 

supporting documentation to assess compliance with provisions 
of relevant laws and regulations described as having a direct 
effect on the financial statements;

 > enquiring of management, the audit committee and in-house 
and external legal counsel concerning actual and potential 
litigation and claims;

 > performing analytical procedures to identify any unusual or 
unexpected relationships that may indicate risks of material 
misstatement due to fraud;

 > reading minutes of meetings of those charged with governance, 
reviewing internal audit reports and reviewing correspondence 
with HMRC and regulators, including the FCA; 

 > in addressing the risk of fraud through management override of 
controls, testing the appropriateness of journal entries and other 
adjustments; assessing whether the judgements made in making 
accounting estimates are indicative of a potential bias; and 
evaluating the business rationale of any significant transactions 
that are unusual or outside the normal course of business;
 > where actual or suspected non-compliance with laws and 

regulations was identified, we performed specific audit procedures 
to identify and address the risks of material misstatement in the 
financial statements, including making direct enquiries of external 
legal counsel, reviewing relevant correspondence with the 
regulator or judiciary body and reviewing the disclosures in note 
26 and note 35 of the financial statements.

We also communicated relevant identified laws and regulations 
and potential fraud risks to all engagement team members 
including internal specialists and significant component audit 
teams, and remained alert to any indications of fraud or non-
compliance with laws and regulations throughout the audit.

Annual Report and Accounts 2020
121

 
 
 
 
 
 
 
Independent Auditor’s Report to the members of TP ICAP Limited (formerly ‘TP ICAP PLC’)
continued

Report on other legal and regulatory requirements

12. Opinions on other matters prescribed by the 
Companies Act 2006

In our opinion the part of the directors’ remuneration report to be 
audited has been properly prepared in accordance with the 
Companies Act 2006.

In our opinion, based on the work undertaken in the course of 
the audit:

 > the information given in the strategic report and the directors’ 
report for the financial year for which the financial statements 
are prepared is consistent with the financial statements; and

 > the strategic report and the directors’ report have been 

prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group 
and the parent company and their environment obtained in 
the course of the audit, we have not identified any material 
misstatements in the strategic report or the directors’ report.

13. Corporate Governance Statement
The Listing Rules require us to review the directors’ statement in 
relation to going concern, longer-term viability and that part of 
the Corporate Governance Statement relating to the group’s 
compliance with the provisions of the UK Corporate Governance 
Code specified for our review.

Based on the work undertaken as part of our audit, we have 
concluded that each of the following elements of the Corporate 
Governance Statement is materially consistent with the financial 
statements and our knowledge obtained during the audit: 

 > the directors’ statement with regards to the appropriateness 
of adopting the going concern basis of accounting set out on 
page 43;

 > the directors’ explanation as to its assessment of the group’s 
prospects, the period this assessment covers and why the 
period is appropriate set out on page 43;

 > the directors’ statement on fair, balanced and understandable 

set out on page 113;

 > the board’s confirmation that it has carried out a robust 

assessment of the emerging and principal risks set out on 
page 46;

 > the section of the annual report that describes the review of 

effectiveness of risk management and internal control systems 
set out on page 43; and

 > the section describing the work of the audit committee set out 

on page 84.

Annual Report and Accounts 2020
122

15.2. Consistency of the audit report with the additional report 
to the audit committee
Our audit opinion is consistent with the additional report to the 
audit committee we are required to provide in accordance with 
ISAs (UK).

16. Use of our report
This report is made solely to the company’s members, as a body, 
in accordance with Chapter 3 of Part 16 of the Companies Act 2006. 
Our audit work has been undertaken so that we might state to the 
company’s members those matters we are required to state to them 
in an auditor’s report and for no other purpose. To the fullest extent 
permitted by law, we do not accept or assume responsibility to 
anyone other than the company and the company’s members as 
a body, for our audit work, for this report, or for the opinions we 
have formed.

Fiona Walker
For and on behalf of Deloitte LLP
Statutory Auditor
London, United Kingdom
9 March 2021

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

14. Matters on which we are required to report by exception
14.1. Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, 
in our opinion:

 > we have not received all the information and explanations we 

require for our audit; or

 > adequate accounting records have not been kept by the parent 

company, or returns adequate for our audit have not been 
received from branches not visited by us; or

 > the parent company financial statements are not in agreement 

with the accounting records and returns.

We have nothing to report in respect of these matters.

14.2 Directors’ remuneration
Under the Companies Act 2006 we are also required to report if 
in our opinion certain disclosures of directors’ remuneration have 
not been made or the part of the directors’ remuneration report 
to be audited is not in agreement with the accounting records 
and returns.

We have nothing to report in respect of these matters.

15. Other matters which we are required to address
15.1 Auditor tenure
We were first appointed as auditors by a predecessor company of 
the Parent Company upon its listing in 2001. We were appointed to 
audit its financial statements for the year ending 31 December 2001 
and subsequent periods. The period of total uninterrupted 
engagement including previous renewals and reappointments of 
the firm is 20 years, covering the years ending 31 December 2001 
to 31 December 2020. 

Annual Report and Accounts 2020
123

 
 
 
 
 
 
 
Consolidated Income Statement
for the year ended 31 December 2020

Revenue 
Employment, compensation and benefits
General and administrative expenses
Depreciation and impairment of property, plant and equipment and right-of-use assets
Amortisation and impairment of Intangible assets
Impairment of other assets
Total operating costs
Other operating income
Operating profit
Finance income
Finance costs
Profit before tax
Taxation
Profit after tax
Share of results of associates and joint ventures
Profit for the year

Attributable to:
Equity holders of the parent
Non-controlling interests

Earnings per share 
– Basic
– Diluted

Notes
4

5
6

8
9

10

17,18

11
11

2020 
£m
1,794
(1,153)
(360)
(37)
(59)
(23)
(1,632)
16
178
3
(52)
129
(48)
81
16
97

96
1
97

17.2p
17.0p

2019
£m
1,833
(1,154)
(435)
(34)
(69)
(24)
(1,716)
25
142
6
(55)
93
(40)
53
15
68

67
1
68

12.0p
11.9p

Annual Report and Accounts 2020
124

Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020

Profit for the year
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit pension schemes
Equity instruments at FVTOCI – net change in fair value
Taxation

Items that may be reclassified subsequently to profit or loss:
Fair value movements on net investment hedge
Effect of changes in exchange rates on translation of foreign operations
Taxation

Other comprehensive loss for the year
Total comprehensive income/(loss) for the year

Attributable to:
Equity holders of the parent
Non-controlling interests

Notes

37
19
10

2020 
£m
97

2
–
–
2

2
(30)
(1)
(29)
(27)
70

69
1
70

2019 
£m
68

(52)
1
19
(32)

–
(44)
–
(44)
(76)
(8)

(8)
–
(8)

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Annual Report and Accounts 2020
125

 
 
 
 
 
 
 
Consolidated Balance Sheet
as at 31 December 2020

Non-current assets
Intangible assets arising on consolidation
Other intangible assets
Property, plant and equipment
Right-of-use assets
Investment in associates
Investment in joint ventures
Other investments
Deferred tax assets
Retirement benefit assets
Other long-term receivables 

Current assets
Trade and other receivables
Financial investments
Derivative financial instruments
Cash and cash equivalents

Total assets
Current liabilities
Trade and other payables
Loans and borrowings
Lease liabilities
Current tax liabilities
Short-term provisions

Net current assets
Non-current liabilities
Loans and borrowings
Lease liabilities
Deferred tax liabilities
Long-term provisions
Other long-term payables
Retirement benefit obligations

Total liabilities
Net assets

Equity
Share capital
Share premium
Merger reserve
Other reserves
Retained earnings
Equity attributable to equity holders of the parent
Non-controlling interests
Total equity 

Notes

13
14
15
16
17
18
19
21
37
22

22
20
28(c)
34

23
24
25

26

24
25
21
26
27
37

29,30(a)
30(a)
30(a)
30(b)
30(c)
30(c)
30(c)

2020 
£m

1,463
58
101
163
61
29
18
4
–
24
1,921

70,027
127
3
656
70,813
72,734

(69,927)
(46)
(26)
(28)
(17)
(70,044)
769

(679)
(186)
(79)
(23)
(23)
(2)
(992)
(71,036)
1,698

141
17
1,384
(1,246)
1,383
1,679
19
1,698

2019
£m

1,511
61
72
91
58
28
20
3
–
26
1,870

49,371
148
–
676
50,195
52,065

(49,305)
(11)
(23)
(48)
(21)
(49,408)
787

(678)
(117)
(83)
(26)
(21)
(2)
(927)
(50,335)
1,730

141
17
1,384
(1,205)
1,375
1,712
18
1,730

The Consolidated Financial Statements of TP ICAP Limited (registered number 5807599) were approved by the Board of Directors and 
authorised for issue on 9 March 2021 and are signed on its behalf by

Nicolas Breteau
Chief Executive Officer

Annual Report and Accounts 2020
126

Consolidated Statement of Changes in Equity
for the year ended 31 December 2020

Equity attributable to equity holders of the parent (Note 30)

Share 
capital 
£m

Share 
premium 
account 
£m

Merger 
reserve 
£m

Reverse 
acquisition 
reserve 
£m

Re-
valuation 
reserve 
£m

Hedging 
and 
translation 
£m

Own  
shares 
£m

Retained 
earnings 
£m

Non-
controlling 
interests 
£m

Total 
£m

Total  
equity 
£m

141
–

17
–

1,384
–

(1,182)
–

–

–
–

–

–

–

–

–

–

–
–

–

–

–

–

–

–

–
–

–

–

–

–

–

–

–
–

–

–

–

–

–

141

17

1,384

(1,182)

5
–

–

–
–

(1)

–

–

–

–

4

(12)
–

(16)
–

1,375
96

1,712
96

18
1

1,730
97

(29)

(29)
–

–

–

–

–

–

–

–
–

–

3

(14)

–

–

2

(27)

–

(27)

98
(94)

69
(94)

1
(1)

70
(95)

1

(3)

–

–

6

–

–

(14)

–

6

–

–

–

1

–

–

–

(14)

1

6

(41)

(27)

1,383

1,679

19

1,698

Equity attributable to equity holders of the parent (Note 30)

Share 
capital 
£m

Share 
premium 
account 
£m

Merger 
reserve 
£m

Reverse 
acquisition 
reserve 
£m

Re-
valuation 
reserve 
£m

Hedging 
and 
translation 
£m

Own  
shares 
£m

Retained 
earnings 
£m

Non-
controlling 
interests 
£m

Total 
£m

Total  
equity 
£m

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

141
–

17
–

1,384
–

(1,182)
–

–

–
–

–

–

–

–

–

–
–

–

–

–

–

–

–
–

–

–

–

–

–

–
–

–

–

–

–

141

17

1,384

(1,182)

4
–

1

1
–

–

–

–

–

5

31
–

(43)

(43)
–

–

–

–

–

(11)
–

1,430
67

1,814
67

16
1

1,830
68

–

–
–

2

(7)

–

–

(33)

(75)

34
(94)

(3)

–

3

5

(8)
(94)

(1)

(7)

3

5

(1)

–
(1)

–

–

3

–

(76)

(8)
(95)

(1)

(7)

6

5

(12)

(16)

1,375

1,712

18

1,730

2020
Balance at  
1 January 2020
Profit for the year
Other 
comprehensive 
(loss)/income for 
the year
Total comprehensive 
income/(loss) for 
the year
Dividends paid
Gain on disposal of 
equity instruments 
at FVTOCI
Share settlement of 
share-based awards
Own shares acquired 
for employee trusts
Increase in non-
controlling interests
Credit arising on 
share-based awards
Balance at 
31 December 2020

2019
Balance at  
1 January 2019
Profit for the year
Other 
comprehensive 
(loss)/income for 
the year
Total comprehensive 
(loss)/income for
the year
Dividends paid
Share settlement of 
share-based awards
Own shares acquired 
for employee trusts
Increase in non-
controlling interests
Credit arising on 
share-based awards
Balance at 
31 December 2019

Annual Report and Accounts 2020
127

 
 
 
 
 
 
 
Consolidated Cash Flow Statement
for the year ended 31 December 2020

Net cash flow from operating activities

Investing activities
Sale/(purchase) of financial investments1
Sale of equity instruments at FVTOCI
Purchase of equity investments at FVTOCI
Purchase of derivative financial instruments
Interest received
Dividends from associates and joint ventures
Expenditure on intangible fixed assets
Purchase of property, plant and equipment
Direct costs on acquiring right-of-use assets 
Deferred consideration paid 
Investment in associates and joint ventures
Acquisition consideration paid
Cash acquired with acquisitions
Net cash flow from investment activities

Financing activities
Dividends paid
Dividends paid to non-controlling interests
Dividend equivalents paid on share-based awards
Sale of equity to non-controlling interests
Own shares acquired for employee trusts
Net repayment of bank loans2
Net borrowing/(repayment) of loans from related parties2
Gain on derivative financial instruments
Funds received from issue of Sterling Notes
Repayment/repurchase of Sterling Notes
Bank facility arrangement fees and debt issue costs
Payment of lease liabilities
Net cash flow from financing activities

(Decrease)/increase in cash and overdrafts

Cash and overdrafts at the beginning of the year 
Effect of foreign exchange rate changes
Cash and overdrafts at the end of the year

Cash and cash equivalents
Overdrafts

Notes
33

12

24
24

34

34
34

2020 
£m
144

18
2
–
(2)
3
13
(16)
(35)
(2)
(22)
(3)
(18)
9
(53)

(94)
(1)
–
–
(14)
–
28
–
–
–
–
(24)
(105)

(14)

676
(13)
649

656
(7)
649

2019
£m
148

(20)
1
(1)
–
5
10
(20)
(13)

(12)
(5)
–
–
(55)

(94)
(1)
(1)
6
(7)
(52)
(3)
3
250
(149)
(2)
(21)
(71)

22

667
(13)
676

686
(10)
676

Includes the impact of a change in classification of restricted funds during the year.

1 
2  The Group utilises credit facilities throughout the year, entering into numerous short-term bank and other loans where maturities are less than three months. The turnover 

is quick and the volume is large and resultant flows are presented net. Further details are set out in Note 24.

Annual Report and Accounts 2020
128

Notes to the Consolidated Financial Statements 
for the year ended 31 December 2020

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

(b) Basis of consolidation
The Group’s Consolidated Financial Statements incorporate the 
Financial Statements of the Company and entities controlled by the 
Company made up to 31 December each year. Under IFRS 10 
‘Consolidated Financial Statements’, control is achieved where the 
Company exercises power over an entity, is exposed to, or has rights 
to, variable returns from its involvement with the entity and has the 
ability to use its power to affect the returns from the entity.

The results of subsidiaries acquired or disposed of during the year 
are included in the Consolidated Income Statement from the 
effective date of acquisition or up to the effective date of disposal, 
as appropriate. Where necessary, adjustments are made to the 
financial statements of subsidiaries to bring the accounting policies 
used into line with those used by the Group. All inter-company 
transactions, balances, income and expenses are eliminated on 
consolidation.

Non-controlling interests in subsidiaries are identified separately 
from the Group’s equity therein. Those interests of non-controlling 
shareholders that are present ownership interests entitling their 
holders to a proportionate share of net assets upon liquidation may 
initially be measured at fair value or at the non-controlling interests’ 
proportionate share of the fair value of the acquiree’s identifiable 
net assets. Other non-controlling interests are initially measured at 
fair value. The choice of measurement is made on an acquisition by 
acquisition basis. Subsequent to acquisition, the carrying amount 
of non-controlling interests is the amount of those interests at initial 
recognition plus the non-controlling interests’ share of subsequent 
changes in equity. Total comprehensive income is attributed to 
non-controlling interests even if this results in the non-controlling 
interest having a deficit balance. 

Changes in the Group’s interests in subsidiaries that do not result in 
a loss of control are accounted for as equity transactions. The 
carrying amount of the Group’s interests and the non-controlling 
interests are adjusted to reflect the changes in their relative 
interests in the subsidiaries. Any differences between the amount by 
which the non-controlling interests are adjusted and the fair value 
of the consideration paid or received is recognised directly in equity 
and attributed to the owners of the Company.

When the Group loses control of a subsidiary, the profit or loss on 
disposal is calculated as the difference between (i) the aggregate 
of the fair value of the consideration received and the fair value of 
any retained interest and (ii) the previous carrying amount of the 
assets, including goodwill, less liabilities of the subsidiary and any 
non-controlling interests. Amounts previously recognised in other 
comprehensive income in relation to the subsidiary are accounted 
for in the same manner as would be required if the relevant assets 
or liabilities are disposed of. The fair value of any investment 
retained in the former subsidiary at the date when control was lost 
is regarded as the fair value on initial recognition for subsequent 
accounting under IFRS 9 ‘Financial Instruments’ or, when 
applicable, the cost on initial recognition of an investment in an 
associate or jointly controlled entity.

1. General information 
As at 31 December 2020 TP ICAP plc (the ‘Company’) was a public 
company limited by shares incorporated in England and Wales 
under the Companies Act. On 26 February 2021 following a Scheme 
of Arrangement, described on the contents page of the inside front 
cover of the Annual Report, TP ICAP Group plc acquired the entire 
share capital of the Company, resulting in TP ICAP Group plc 
becoming the Group’s ultimate parent undertaking. On 8 March 
2021 the Company re-registered as a limited company. The address 
of the registered offices of the Company and TP ICAP Group plc is 
given on page 190. The nature of the Group’s operations and its 
principal activities are set out in the Directors’ report on pages 109 
to 112 and in the Strategic Report on pages 1 to 61.

2. Basis of preparation
(a) Basis of accounting
The Group’s Consolidated Financial Statements have been 
prepared in accordance with International Accounting Standards in 
conformity with the requirements of the Companies Act 2006 and 
in accordance with International Financial Reporting Standards 
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in 
the European Union.

The Financial Statements are presented in Pounds Sterling because 
that is the currency of the primary economic environment in which 
the Group operates and are rounded to the nearest million pounds 
(expressed as £m), except where otherwise indicated. The 
significant accounting policies are set out in Note 3.

The Financial Statements have been prepared on the historical cost 
basis, except for the revaluation of certain financial instruments 
held at fair values at the end of each reporting period, as explained 
in the accounting policies. Historical cost is generally based on the 
fair value of the consideration given in exchange for goods and 
services.

Fair value is the price that would be received to sell an asset or paid 
to transfer a liability in an orderly transaction between market 
participants at the measurement date, regardless of whether that 
price is directly observable or estimated using another valuation 
technique. In estimating the fair value of an asset or a liability, the 
Group takes into account the characteristics of the asset or liability 
if market participants would take those characteristics into account 
when pricing the asset or liability at the measurement date. Fair 
value for measurement and/or disclosure purposes in these 
Consolidated Financial Statements is determined on such a basis, 
except for share-based payment transactions that are within the 
scope of IFRS 2, leasing transactions that are within the scope of 
IFRS 16, and measurements that have some similarities to fair value 
but are not fair value, such as net realisable value in IAS 2 or value 
in use in IAS 36.

For financial reporting purposes, fair value measurements are 
categorised into Level 1, 2 or 3 based on the degree to which inputs 
to the fair value measurements are observable and the significance 
of the inputs to the fair value measurement in its entirety, which are 
described as follows:

 > Level 1 inputs are quoted prices (unadjusted) in active markets for 

identical assets or liabilities;

 > Level 2 inputs are inputs, other than quoted prices included 

within Level 1, that are observable for the asset or liability, either 
directly (i.e. as prices) or indirectly (i.e. derived from prices); and 

 > Level 3 inputs are unobservable inputs for the asset or liability.

Annual Report and Accounts 2020
129

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

2. Basis of preparation continued
(c) Presentation of the Income Statement
Previously the Group presented a columnar format for its 
Consolidated Income Statement in order to aid the understanding 
of the ‘underlying’ performance measures used by the Group’s Chief 
Operating Decision Maker (‘CODM’) and to provide a reconciliation 
to the Group’s IFRS reported numbers. For 2020 the information 
considered by the Group’s CODM is contained in Note 4 ‘Segmental 
Analysis’, in the Financial and Operating Review on pages 28 to 42, 
and in the Alternative Performance Measures appendix on page 203.

3. Summary of significant accounting policies
(a) Income recognition
Revenue, which excludes sales taxes, includes brokerage including 
commissions, fees earned and subscriptions for information sales. 
Fee income is recognised when the related services are completed 
and the income is considered receivable. 

Each geographic segment comprises the following types 
of revenue:

(i) 

 Name Passing brokerage, where counterparties to a transaction 
settle directly with each other. Revenue for the service of 
matching buyers and sellers of financial instruments is stated 
net of sales taxes, rebates and discounts and is recognised in 
full on trade date (point in time recognition);

(ii)   Matched Principal brokerage revenue, being the net proceeds 
from a commitment to simultaneously buy and sell financial 
instruments with counterparties, is recognised on trade date;

(iii)  Executing Broker brokerage, where the Group executes 

transactions on certain regulated exchanges and then ‘gives-up’ 
the trade to the relevant client, or its clearing member. Revenue 
for the service of matching buyers and sellers of financial 
instruments is stated net of sales taxes, rebates and discounts and 
is recognised in full on trade date (point in time recognition); 

(iv)  Fees earned from the sales of price information from financial 
and commodity markets to third parties are recognised on an 
accruals basis to match the provision of the service (recognised 
over time). In relation to these contracts the Group has a right to 
consideration in an amount that corresponds directly with the 
value to the customer of the Group’s performance completed to 
date In respect of contracts for the sale of price information 
from financial and commodity markets, the Group has applied 
the practical expedient in IFRS 15, allowing for the non-
disclosure of both the amount of the transaction price allocated 
to the remaining performance obligations, and an explanation 
of when it expects to recognise that amount; and

(v)   Fees from the sales of price information from financial and 

commodity markets that are provided over time, but which are 
contingent on the validation of price information usage, are 
recognised once usage has been verified (point in time).

Interest income is accrued on a time basis, by reference to the 
principal outstanding and at the effective interest rate applicable. 
Dividend income from investments is recognised when the Group’s 
right to receive the payment is established.

(d) Going concern 
The Directors of the Company have, at the time of approving the 
Financial Statements, a reasonable expectation that the Group 
now owned by TP ICAP Group has adequate resources to continue 
in operational existence for the foreseeable future. Thus they 
continue to adopt the going concern basis of accounting in 
preparing the Group’s Consolidated Financial Statements. Further 
detail is contained in the going concern section and viability 
statement included in the Strategic Report on page 43.

(e) Adoption of new and revised Standards
The following new and revised Standards and Interpretations are 
effective from 1 January 2020 but they do not have a material 
effect on the Group’s Consolidated Financial Statements:

 > Amendments to IAS 1 and IAS 8: Definition of Material;
 > Amendments to References to the Conceptual Framework in 

IFRS Standards;

 > Amendments to IFRS 3 Business Combinations; and
 > Amendments to IFRS 9, IAS 39 and IFRS 7: Interest Rate 

Benchmark Reform.

At the date of authorisation of these Consolidated Financial 
Statements, the following Standards and Interpretations were in 
issue but not yet effective. The Group has not applied these 
Standards or Interpretations in the preparation of these 
Consolidated Financial Statements:

 > Amendments to IFRS 4 Insurance Contracts – deferral of IFRS 9; 
 > Amendment to IFRS 16 Leases Covid 19-Related Rent 

Concessions; and

 > Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest 

Rate Benchmark Reform – Phase 2.

The following Standards and Interpretations have not been 
endorsed by the UK and have not been applied in the preparation 
of these Consolidated Financial Statements:

 > IFRS 17 Insurance Contracts including Amendments to IFRS 17;
 > Amendments to IAS 1 Presentation of Financial Statements: 

Classification of Liabilities as Current or Non-current (including 
the amendment deferring the effective date);
 > Amendment to IFRS 3 Business Combinations; 
 > Amendments to IAS 16 Property, Plant and Equipment; 
 > Amendments to IAS 37 Provisions, Contingent Liabilities and 

Contingent Assets; and

 > Annual Improvements 2018-2020.

The Directors do not expect the adoption of the above Standards 
and Interpretations will have a material impact on the Consolidated 
Financial Statements of the Group in future periods.

Annual Report and Accounts 2020
130

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

(c) Investment in associates
An associate is an entity over which the Group is in a position to 
exercise significant influence. Significant influence is the power to 
participate in the financial and operating decisions of the investee 
but is not control or joint control over these policies.

The results and assets and liabilities of associates are incorporated 
in these Financial Statements based on financial information 
made up to 31 December each year using the equity method of 
accounting, except when classified as held for sale. Investments in 
associates are carried in the balance sheet at cost as adjusted by 
post-acquisition changes in the Group’s share of the net assets of 
the associate, less any impairment in the value of individual 
investments. Losses of the associates in excess of the Group’s 
interest in those associates are recognised only to the extent that 
the Group has incurred legal or constructive obligations or made 
payments on behalf of the associate.

Any excess of the cost of acquisition over the Group’s share of the 
fair values of the identifiable net assets of the associate at the date 
of acquisition is recognised as goodwill. Any discount in the cost 
of acquisition below the Group’s share of the fair value of the 
identifiable net assets of the associate at the date of acquisition 
(i.e. discount on acquisition) is credited to profit and loss in the year 
of acquisition.

Where a Group company transacts with an associate of the Group, 
profits and losses are eliminated to the extent of the Group’s 
interest in the relevant associate. Losses may provide evidence of 
impairment of the asset transferred in which case appropriate 
provision is made for impairment.

(d) Interests in joint arrangements
A joint arrangement is a contractual arrangement whereby the 
Group and other parties undertake an economic activity that is 
subject to joint control.

Joint ventures are joint arrangements which involve the 
establishment of a separate entity in which each party has rights to 
the net assets of the arrangement. The Group reports its interests in 
joint ventures using the equity method of accounting, based on 
financial information made up to 31 December each year. 
Investments in joint ventures are carried in the balance sheet at cost 
as adjusted by post-acquisition changes in the Group’s share of the 
net assets of the joint venture, less any impairment in the value of 
individual investments. Losses of the joint venture in excess of the 
Group’s interest in those joint ventures are recognised only to the 
extent that the Group has incurred legal or constructive obligations 
or made payments under the terms of the joint venture.

(b) Business combinations
Acquisitions of subsidiaries and businesses are accounted for using 
the acquisition method. The consideration for each acquisition is 
measured at the aggregate of the fair values (at the date of 
exchange) of assets given, liabilities incurred or assumed, and equity 
instruments issued by the Group in exchange for control of the 
acquiree. Acquisition costs are recognised in profit or loss as incurred.

Where applicable, deferred consideration for the acquisition 
includes any asset or liability resulting from a non-contingent or 
contingent consideration arrangement, measured at its acquisition 
date fair value. Subsequent changes in such fair values of 
contingent consideration are adjusted against the cost of the 
acquisition where they qualify as measurement period adjustments. 
The measurement period is the period from the date of acquisition 
to the date the Group obtains complete information about the facts 
and circumstances that existed as of the acquisition date, and is 
subject to a maximum of one year. All subsequent changes in the 
fair value of contingent consideration classified as an asset or 
a liability are accounted for in accordance with relevant IFRSs. 
The cash settlement of deferred consideration is reported as part 
of investing activities in the cash flow. Deferred consideration 
classified as equity is not remeasured (outside of the measurement 
period) with subsequent settlement accounted for within equity.

Where a business combination is achieved in stages, the Group’s 
previously held interests in the acquired entity are remeasured to 
fair value at the acquisition date and any resulting gain or loss is 
recognised in profit or loss. Amounts arising from interests in the 
acquiree prior to the acquisition that have previously been 
recognised in other comprehensive income are reclassified to profit 
or loss, where such treatment would be appropriate if that interest 
was disposed of.

The acquiree’s identifiable assets, liabilities and contingent 
liabilities that meet the conditions for recognition under IFRS 3 
(2008) are recognised at their fair value at the acquisition date, 
except that:

 > deferred tax assets or liabilities are recognised and measured 

in accordance with IAS 12 ‘Income Taxes’;

 > liabilities or assets related to employee benefit arrangements 

are recognised and measured in accordance with IAS 19 
‘Employee Benefits’;

 > acquiree share-based payment awards replaced by Group 

awards are measured in accordance with IFRS 2 ‘Share-based 
Payments’; and

 > assets or disposal groups that are classified for sale are measured 
in accordance with IFRS 5 ‘Non-current Assets Held for Sale and 
Discontinued Operations’.

If the initial accounting for a business combination is incomplete by 
the end of the reporting period in which the business combination 
occurs, provisional amounts are reported. Those provisional 
amounts are adjusted during the measurement period, or 
additional assets or liabilities recognised, to reflect the facts and 
circumstances that existed as at the acquisition date.

Non-controlling interests in the acquired entity are initially 
measured at the non-controlling interest’s proportion of the net fair 
value of the assets, liabilities and contingent liabilities recognised.

Annual Report and Accounts 2020
131

 
 
 
 
 
 
 
Other than software development costs, intangible assets created 
within the business are not capitalised and expenditure is charged 
to the income statement in the year in which the expenditure 
is incurred.

Intangible assets are amortised over their finite useful lives 
generally on a straight-line basis, as follows:

Software:
Purchased or developed 
Software licences 

Acquisition intangibles:
Brand/Trademarks 
Customer relationships 
Other intangibles 

– up to 5 years
– over the period of the licence

– up to 5 years
– 2 to 20 years
– over the period of the contract

Intangible assets are subject to impairment review if there are 
events or changes in circumstances that indicate that the carrying 
amount may not be recoverable.

Gains or losses arising from derecognition of an intangible asset are 
measured as the difference between the net disposal proceeds and 
the carrying amount of the asset and are recognised in the income 
statement when the asset is derecognised.

(g) Property, plant and equipment
Freehold land is stated at cost. Buildings, furniture, fixtures, 
equipment and motor vehicles are stated at cost less accumulated 
depreciation and any recognised impairment loss. Depreciation is 
provided on all tangible fixed assets at rates calculated to write off 
the cost, less estimated residual value based on prices prevailing at 
the date of acquisition, of each asset on a straight-line basis over its 
expected useful life as follows:

Furniture, fixtures, equipment  
and motor vehicles 
Short and long leasehold  
land and buildings 
Freehold land 
Freehold buildings 

– 3 to 10 years

– period of the lease
– infinite
– 50 years

Assets held under finance leases are depreciated over their 
expected useful lives on the same basis as owned assets or, where 
shorter, the term of the relevant lease.

The gain or loss arising on the disposal or retirement of an asset is 
determined as the difference between the sales proceeds and the 
carrying amount of the asset and is recognised in income.

Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

3. Summary of significant accounting policies continued
(e) Goodwill
Goodwill arising on consolidation represents the excess of the cost 
of acquisition over the Group’s interest in the fair value of the 
identifiable assets, liabilities and contingent liabilities of 
a subsidiary or associate at the date of acquisition. Goodwill is 
initially recognised at cost and is subsequently measured at cost less 
any accumulated impairment losses. Goodwill arising on acquisitions 
before the date of transition to IFRS has been retained at the 
previous UK GAAP amounts at that date. 

Goodwill recognised as an asset is reviewed for impairment at 
least annually. Any impairment loss is recognised as an expense 
immediately and is not subsequently reversed. For the purpose of 
impairment testing goodwill is allocated to groups of individual 
cash-generating units (‘CGU’) expected to benefit from the 
synergies of the combination. CGUs to which goodwill has been 
allocated are tested for impairment annually, or more frequently 
when there is an indication that the unit may be impaired. If the 
recoverable amount of the CGU is less than the carrying amount of 
any goodwill allocated to the unit, the impairment loss is allocated 
first to reduce the carrying amount of any goodwill allocated to the 
unit and then to the other assets of the unit pro rata on the basis of 
the carrying amount of each asset in the unit.

Goodwill arising on the acquisition of an associate or joint venture 
is included within the carrying value of the associate or the joint 
venture. Goodwill arising on the acquisition of subsidiaries is 
presented separately in the balance sheet. 

On disposal of a subsidiary, associate or joint venture, the 
attributable amount of goodwill is included in the determination 
of the profit or loss on disposal. 

(f) Intangible assets
Software and software development costs
An internally generated intangible asset arising from the Group’s 
software development is recognised at cost only if all of the 
following conditions are met:

 > an asset is created that can be identified; 
 > it is probable that the asset created will generate future 

economic benefits; and

 > the development costs of the asset can be measured reliably.

Where the above conditions are not met, costs are expensed 
as incurred. 

Acquired separately or from a business combination
Intangible assets acquired separately are capitalised at cost and 
intangible assets acquired in a business acquisition are capitalised 
at fair value at the date of acquisition. The useful lives of these 
intangible assets are assessed to be either finite or indefinite. 
Amortisation charged on assets with a finite useful life is taken 
to the income statement through administrative expenses.

Annual Report and Accounts 2020
132

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

(h) Impairment of tangible and intangible assets excluding 
goodwill
At each balance sheet date, the Group reviews the carrying 
amounts of its tangible and intangible assets with finite lives to 
determine whether there is any indication that those assets have 
suffered an impairment loss. If any such indication exists, the 
recoverable amount of the asset is estimated in order to determine 
the extent of the impairment loss. Where the asset does not 
generate cash flows that are independent from other assets, the 
Group estimates the recoverable amount of the CGU to which the 
asset belongs. Intangible assets with indefinite useful lives are 
tested for impairment annually and whenever there is an indication 
that the asset may be impaired.

Recoverable amount is the higher of fair value less any cost to sell 
and value in use. In assessing value in use, the estimated future cash 
flows are discounted to their present values using a pre-tax discount 
rate that reflects current market assessments of the time value of 
money and the risks specific to the asset.

If the recoverable amount of an asset (or CGU) is estimated to be 
less than its carrying amount, the carrying amount of the asset (or 
CGU) is reduced to its recoverable amount. Impairment losses are 
recognised as an expense immediately. Where an impairment loss 
subsequently reverses, the carrying amount of the asset (or CGU) is 
increased to the revised estimate of its recoverable amount, but so 
that the increased carrying amount does not exceed the carrying 
amount that would have been determined had no impairment loss 
been recognised for the asset (or CGU) in prior years. A reversal of 
an impairment loss is recognised as income immediately, unless the 
relevant asset is carried at a revalued amount, in which case the 
reversal of the impairment loss is treated as a revaluation increase.

(i) Broker contract payments
Payments made to brokers under employment contracts which are 
in advance of the expected economic benefit due to the Group are 
accounted for as prepayments and included within trade and other 
receivables. Payments made in advance are subject to repayment 
conditions during the contract period and the prepayment is 
amortised over the shorter of the contract term and the period the 
payment remains recoverable. Amounts that are irrecoverable, or 
become irrecoverable, are written off immediately.

Payments made in arrears are accrued and are included within 
trade and other payables.

(j) Financial instruments
Financial assets and financial liabilities are recognised on the 
Group’s balance sheet when the Group has become a party 
to the contractual provisions of the instrument. 

Financial assets and financial liabilities are initially measured 
at fair value. Transaction costs that are directly attributable to 
the acquisition or issue of financial assets and financial liabilities 
(other than financial assets and financial liabilities subsequently 
measured at fair value through profit or loss) are added to or 
deducted from the fair value of the financial assets or financial 
liabilities, as appropriate, on initial recognition. Transaction costs 
directly attributable to the acquisition of financial assets or 
financial liabilities that are subsequently measured at fair value 
through profit or loss are recognised immediately in profit or loss.

All regular way purchases or sales of financial assets are recognised 
and derecognised on a trade date basis. Regular way purchases or 
sales are purchases or sales of financial assets that require delivery 
of assets within the time frame established by regulation or 
convention in the marketplace.

All recognised financial assets are measured subsequently in their 
entirety at either amortised cost or fair value, depending on the 
classification of the financial assets.

Classification of financial assets
The classification of financial assets is based both on the business 
model within which the asset is held and the contractual cash flow 
characteristics of the asset. 

Debt instruments that meet the following conditions are measured 
subsequently at amortised cost:

 > the financial asset is held within a business model whose 

objective is to hold financial assets in order to collect contractual 
cash flows; and

 > the contractual terms of the financial asset give rise on specified 
dates to cash flows that are solely payments of principal and 
interest on the principal amount outstanding.

Debt instruments that meet the following conditions are 
measured subsequently at fair value through other comprehensive 
income (‘FVTOCI’):

 > the financial asset is held within a business model whose 

objective is achieved by both collecting contractual cash flows 
and selling the financial assets; and

 > the contractual terms of the financial asset give rise on specified 
dates to cash flows that are solely payments of principal and 
interest on the principal amount outstanding.

By default, all other financial assets are measured subsequently 
at fair value through profit or loss (‘FVTPL’).

The Group may make the following irrevocable elections or 
designations at initial recognition of a financial asset:

 > to irrevocably elect to present subsequent changes in fair value of 
an equity investment in other comprehensive income if certain 
criteria are met; and

 > to irrevocably designate a debt investment that meets the 

amortised cost or FVTOCI criteria as measured at FVTPL if doing 
so eliminates or significantly reduces an accounting mismatch. 

Debt instruments at FVTOCI
Debt instruments at FVTOCI are initially measured at fair value plus 
transaction costs. Subsequently, changes in the carrying amount as 
a result of foreign exchange gains and losses, impairment gains or 
losses, and interest income calculated using the effective interest 
method are recognised in profit or loss. 

All other changes in the carrying amount of these corporate bonds 
are recognised in other comprehensive income and accumulated in 
the revaluation reserve. When such assets are derecognised, the 
cumulative gains or losses previously recognised in other 
comprehensive income are reclassified to profit or loss.

Annual Report and Accounts 2020
133

 
 
 
 
 
 
 
Derecognition of financial assets
The Group derecognises a financial asset only when the contractual 
rights to the cash flows from the asset expire, or when it transfers 
the financial asset and substantially all the risks and rewards of 
ownership of the asset. If the Group neither transfers nor retains 
substantially all the risks and rewards of ownership and continues 
to control the transferred asset, the Group recognises its retained 
interest in the asset and an associated liability for amounts it may 
have to pay. If the Group retains substantially all the risks and 
rewards of ownership of a transferred financial asset, the Group 
continues to recognise the financial asset and also recognises 
a collateralised borrowing for the proceeds received.

On derecognition of a financial asset measured at amortised cost, 
the difference between the asset’s carrying amount and the sum 
of the consideration received and receivable is recognised in profit 
or loss. On derecognition of an investment in a debt instrument 
classified as at FVTOCI, the cumulative gain or loss previously 
accumulated in the investments revaluation reserve is reclassified 
to profit or loss. On derecognition of an investment in equity 
instrument which the Group has elected on initial recognition 
to measure at FVTOCI, the cumulative gain or loss previously 
accumulated in the revaluation reserve is not reclassified to profit 
or loss, but is transferred to retained earnings.

Impairment of financial assets
The Group recognises a loss allowance for expected credit losses 
(‘ECL’) on investments in debt instruments that are measured at 
amortised cost or at FVTOCI, lease receivables, trade receivables 
and contract assets. The amount of expected credit losses is 
updated at each reporting date to reflect changes in credit risk 
since initial recognition of the respective financial instrument. 

The Group always recognises lifetime ECL for trade receivables. 
The expected credit losses on these financial assets are estimated 
using a provision matrix based on the Group’s historical credit loss 
experience, adjusted for factors that are specific to the debtors, 
general economic conditions and an assessment of both the current 
as well as the forecast direction of conditions at the reporting date, 
including time value of money where appropriate.

For all other financial instruments, the Group recognises lifetime 
ECL when there has been a significant increase in credit risk since 
initial recognition. If the credit risk on the financial instrument has 
not increased significantly since initial recognition, the Group 
measures the loss allowance for that financial instrument at an 
amount equal to 12-month ECL. Lifetime ECL represents the 
expected credit losses that will result from all possible default 
events over the expected life of a financial instrument. 12-month 
ECL represents the portion of lifetime ECL that is expected to result 
from default events on a financial instrument that are possible 
within 12 months after the reporting date.

Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

3. Summary of significant accounting policies continued
(j) Financial instruments continued
Equity instruments at FVTOCI
On initial recognition, the Group may make an irrevocable 
election, on an instrument-by-instrument basis, to designate 
investments in equity instruments as at FVTOCI. Designation at 
FVTOCI is not permitted if the equity investment is held for trading 
or if it is contingent consideration recognised by an acquirer in 
a business combination.

A financial asset is held for trading if:

 > it has been acquired principally for the purpose of selling it in the 

near term; or 

 > on initial recognition it is part of a portfolio of identified 

financial instruments that the Group manages together and has 
evidence of a recent actual pattern of short-term profit-taking; or

 > it is a derivative, except for a derivative that is a financial 
guarantee contract or a designated and effective hedging 
instrument.

Investments in equity instruments at FVTOCI are initially measured 
at fair value plus transaction costs. Subsequently, they are measured 
at fair value with gains and losses arising from changes in fair value 
recognised in other comprehensive income and accumulated in the 
revaluation reserve. The cumulative gain or loss is not reclassified to 
profit or loss on disposal of the equity investments, instead, it is 
transferred to retained earnings.

Dividends on these investments in equity instruments are 
recognised in profit or loss unless the dividends clearly represent 
a recovery of part of the cost of the investment. Dividends are 
included as finance income in profit or loss.

The Group has designated all investments in equity instruments 
that are not held for trading as at FVTOCI on initial application 
of IFRS 9.

Financial assets at FVTPL
Financial assets that do not meet the criteria for being measured 
at amortised cost or FVTOCI are measured at FVTPL. Specifically:

 > investments in equity instruments are classified as at FVTPL, 

unless the Group designates an equity investment that is neither 
held for trading nor a contingent consideration arising from 
a business combination as at FVTOCI on initial recognition; and
 > debt instruments that do not meet the amortised cost criteria or 
the FVTOCI criteria are classified as at FVTPL. Debt instruments 
that meet either the amortised cost criteria or the FVTOCI criteria 
may be designated as at FVTPL upon initial recognition if such 
designation eliminates or significantly reduces a measurement or 
recognition inconsistency that would arise from measuring assets 
or liabilities or recognising the gains and losses on them on 
different bases. The Group has not designated any debt 
instruments as at FVTPL.

Financial assets at FVTPL are measured at fair value at the end 
of each reporting period, with any fair value gains or losses 
recognised in profit or loss to the extent they are not part of a 
designated hedging relationship. The net gain or loss recognised 
in profit or loss includes any dividend or interest earned on the 
financial asset and is included in finance income.

Annual Report and Accounts 2020
134

(j) Financial instruments continued
Significant increase in credit risk
In assessing whether the credit risk on a financial instrument has 
increased significantly since initial recognition, the Group compares 
the risk of a default occurring on the financial instrument at the 
reporting date with the risk of a default occurring on the financial 
instrument at the date of initial recognition. In making this 
assessment, the Group considers both quantitative and qualitative 
information that is reasonable and supportable, including historical 
experience and forward-looking information that is available 
without undue cost or effort. 

The following information is taken into account when assessing 
whether credit risk has increased significantly since initial recognition:

 > an actual or expected significant deterioration in the financial 

instrument’s external or internal credit rating;

 > significant deterioration in external market indicators of credit 

risk for a particular financial instrument;

 > existing or forecast adverse changes in business, financial or 
economic conditions that are expected to cause a significant 
decrease in the debtor’s ability to meet its debt obligations;
 > an actual or expected significant deterioration in the operating 

results of the debtor; and

 > significant increases in credit risk on other financial instruments 
of the same debtor; an actual or expected significant adverse 
change in the regulatory, economic, or technological 
environment of the debtor that results in a significant decrease 
in the debtor’s ability to meet its debt obligations.

The Group presumes that the credit risk on a financial asset has 
increased significantly since initial recognition when contractual 
payments are more than 30 days past due, unless the Group has 
reasonable and supportable information that demonstrates 
otherwise.

The Group assumes that the credit risk on a financial instrument has 
not increased significantly since initial recognition if the financial 
instrument is determined to have low credit risk at the reporting 
date. A financial instrument is determined to have low credit risk if:

 > The financial instrument has a low risk of default; 
 > The debtor has a strong capacity to meet its contractual cash 

flow obligations in the near term; and

 > Adverse changes in economic and business conditions in the 

longer term may, but will not necessarily, reduce the ability of the 
borrower to fulfil its contractual cash flow obligations.

The Group considers a financial asset to have low credit risk 
when its credit risk rating is equivalent to the globally understood 
definition of ‘investment grade’. The Group considers this to 
be Baa3 or higher per Moody’s or BBB- or higher per both Standard 
& Poor’s and Fitch.

The Group monitors the effectiveness of the criteria used to 
identify whether there has been a significant increase in credit 
risk and revises them as appropriate to ensure that the criteria 
are capable of identifying significant increase in credit risk 
before the amount becomes past due.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Credit-impaired financial assets
A financial asset is ‘credit-impaired’ when one or more events that 
have a detrimental impact on the estimated future cash flows of 
the financial asset have occurred.

Definition of default
The Group considers a financial asset to be in default when: 

 > the borrower is unlikely to pay its credit obligations to the Group 
in full, without recourse by the Group to actions such as realising 
security (if any is held); or 

 > the financial asset is more than 90 days past due. 

The maximum period considered when estimating ECLs is the 
maximum contractual period over which the Group is exposed 
to credit risk.

Write-off policy
The Group writes off a financial asset when there is information 
indicating that the debtor is in severe financial difficulty and there 
is no realistic prospect of recovery. Financial assets written off may 
still be subject to enforcement activities under the Group’s recovery 
procedures, taking into account legal advice where appropriate. 
Any recoveries made are recognised in profit or loss.

Presentation of impairment
Loss allowances for financial assets measured at amortised cost are 
deducted from the gross carrying amount of the assets. 

For debt securities at FVTOCI, the loss allowance is recognised in 
OCI, instead of reducing the carrying amount of the asset.

Impairment losses related to trade and other receivables, including 
settlement balances and deposits paid for securities borrowed, 
are presented in general and administrative expenses due to 
materiality consideration. Impairment losses on other financial 
assets are presented under ‘finance costs’, and not presented 
separately in the statement of profit or loss and OCI due to 
materiality considerations. 

Financial liabilities and equity
Debt and equity instruments are classified as either financial 
liabilities or as equity in accordance with the substance of the 
contractual arrangements and the definitions of a financial liability 
and an equity instrument.

Equity instruments
An equity instrument is any contract that evidences a residual 
interest in the assets of an entity after deducting all of its liabilities. 
Equity instruments issued by the Group are recognised at the 
proceeds received, net of direct issue costs.

Repurchase of the Company’s own equity instruments is recognised 
and deducted directly in equity. No gain or loss is recognised in 
profit or loss on the purchase, sale, issue or cancellation of the 
Company’s own equity instruments.

Annual Report and Accounts 2020
135

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

3. Summary of significant accounting policies continued
(j) Financial instruments continued
Financial liabilities
All financial liabilities are measured subsequently at amortised cost 
using the effective interest method or at FVTPL. 

Financial liabilities that arise when a transfer of a financial asset 
does not qualify for derecognition or when the continuing 
involvement approach applies, and financial guarantee contracts 
issued by the Group, are measured in accordance with the specific 
accounting policies set out below.

Financial liabilities at FVTPL
Financial liabilities are classified as at FVTPL when the 
financial liability is (i) contingent consideration of an acquirer 
in a business combination, (ii) held for trading or (iii) it is designated 
as at FVTPL.

A financial liability is classified as held for trading if:

 > it has been acquired principally for the purpose of repurchasing 

it in the near term; or

 > on initial recognition it is part of a portfolio of identified 

financial instruments that the Group manages together and has 
a recent actual pattern of short-term profit-taking; or

 > it is a derivative, except for a derivative that is a financial 
guarantee contract or a designated and effective hedging 
instrument.

A financial liability other than a financial liability held for trading 
or contingent consideration of an acquirer in a business 
combination may be designated as at FVTPL upon initial 
recognition if:

 > such designation eliminates or significantly reduces a 

measurement or recognition inconsistency that would otherwise 
arise; or

 > the financial liability forms part of a group of financial assets 

or financial liabilities or both, which is managed and its 
performance is evaluated on a fair value basis, in accordance 
with the Group’s documented risk management or investment 
strategy, and information about the grouping is provided 
internally on that basis; or

 > it forms part of a contract containing one or more embedded 

derivatives, and IFRS 9 permits the entire combined contract to 
be designated as at FVTPL.

Financial liabilities at FVTPL are measured at fair value, with any 
gains or losses arising on changes in fair value recognised in profit 
or loss to the extent that they are not part of a designated hedging 
relationship. The net gain or loss recognised in profit or loss 
incorporates any interest paid on the financial liability and is 
included in ‘other gains and losses’ in profit or loss.

Financial liabilities that are designated as at FVTPL, the amount of 
change in the fair value of the financial liability that is attributable 
to changes in the credit risk of that liability is recognised in other 
comprehensive income, unless the recognition of the effects of 
changes in the liability’s credit risk in other comprehensive income 
would create or enlarge an accounting mismatch in profit or loss. 
The remaining amount of change in the fair value of liability is 
recognised in profit or loss. Changes in fair value attributable to 
a financial liability’s credit risk that are recognised in other 
comprehensive income are not subsequently reclassified to profit 
or loss; instead, they are transferred to retained earnings upon 
derecognition of the financial liability.

Financial liabilities measured subsequently at amortised cost
Financial liabilities that are not (i) contingent consideration of 
an acquirer in a business combination, (ii) held-for-trading, or (iii) 
designated as at FVTPL, are measured subsequently at amortised 
cost using the effective interest method.

Derecognition of financial liabilities
The Group derecognises financial liabilities when, and only when, 
the Group’s obligations are discharged, cancelled or have expired. 
The difference between the carrying amount of the financial 
liability derecognised and the consideration paid and payable is 
recognised in profit or loss.

When the Group exchanges with the existing lender one debt 
instrument into another one with the substantially different terms, 
such exchange is accounted for as an extinguishment of the original 
financial liability and the recognition of a new financial liability. 
Similarly, the Group accounts for substantial modification of terms 
of an existing liability or part of it as an extinguishment of the 
original financial liability and the recognition of a new liability. It is 
assumed that the terms are substantially different if the discounted 
present value of the cash flows under the new terms, including any 
fees paid net of any fees received and discounted using the original 
effective rate, is at least 10% different from the discounted present 
value of the remaining cash flows of the original financial liability. 
If the modification is not substantial, the difference between: (i) the 
carrying amount of the liability before the modification; and (ii) the 
present value of the cash flows after modification should be 
recognised in profit or loss as the modification gain or loss within 
other gains and losses.

(k) Derivative financial instruments
Derivative financial instruments, such as foreign currency contracts 
and interest rate swaps, are entered into by the Group in order to 
manage its exposure to interest rate and foreign currency 
fluctuations or as simultaneous back-to-back transactions with 
counterparties. The Group does not use derivative financial 
instruments for speculative purposes. 

Derivatives are initially recognised at fair value at the date 
a derivative contract is entered into and are subsequently 
remeasured to their fair value at each balance sheet date. 
The resulting gain or loss is recognised immediately unless the 
derivative is designated and effective as a hedging instrument, 
in which event the timing of the recognition in profit or loss depends 
on the nature of the hedge relationship. 

Annual Report and Accounts 2020
136

(k) Derivative financial instruments continued
A derivative with a positive fair value is recognised as a financial 
asset whereas a derivative with a negative fair value is recognised 
as a financial liability. Derivatives are not offset in the financial 
statements unless the Group has both legal right and intention to 
offset. A derivative is presented as a non-current asset or a 
non-current liability if the remaining maturity of the instrument is 
more than 12 months and it is not expected to be realised or settled 
within 12 months. Other derivatives are presented as current assets 
or current liabilities.

An embedded derivative is a component of a hybrid contract that 
also includes a non-derivative host – with the effect that some of 
the cash flows of the combined instrument vary in a way similar to 
a stand-alone derivative.

Derivatives embedded in hybrid contracts with a financial asset 
host within the scope of IFRS 9 are not separated. The entire hybrid 
contract is classified and subsequently measured as either 
amortised cost or fair value as appropriate.

Derivatives embedded in hybrid contracts with hosts that are not 
financial assets within the scope of IFRS 9 are treated as separate 
derivatives when they meet the definition of a derivative, their risks 
and characteristics are not closely related to those of the host 
contracts and the host contracts are not measured at FVTPL.

If the hybrid contract is a quoted financial liability, instead of 
separating the embedded derivative, the Group generally 
designates the whole hybrid contract at FVTPL.

An embedded derivative is presented as a non-current asset or 
non-current liability if the remaining maturity of the hybrid 
instrument to which the embedded derivative relates is more than 
12 months and is not expected to be realised or settled within 
12 months.

(l) Hedge accounting
Derivatives designated as hedges are either ‘fair value hedges’ 
or ‘hedges of net investments in foreign operations’.

Where hedging gains or losses are recognised in profit or loss, they 
are recognised in the same line as the hedged item.

Hedge accounting is discontinued when the hedging relationship 
no longer meets the risk management objective or where the 
hedging relationship no longer complies with the qualifying criteria 
or if the hedging instrument has been sold or terminated.

Net investment hedges
The effective portion of changes in the fair value of derivatives that 
are designated and qualify as net investment hedges is recognised 
in other comprehensive income and accumulated in the hedging 
and translation reserve. The gain or loss relating to the ineffective 
portion is recognised immediately in profit or loss, and is included 
in financial income or financial expense respectively.

Where the Group designates the intrinsic value of purchased 
options as the hedging instrument in a net investment hedge, 
changes in the time value of the option are required to be recorded 
initially in other comprehensive income. Under the ‘cost of hedging’ 
approach, the initial option premium cost is recycled from other 
comprehensive income and recognised in the income statement 
on a straight-line basis over the period of the hedge.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Gains and losses deferred in the hedging and translation 
reserve are recognised in profit or loss on disposal of the 
foreign operation.

(m) Settlement balances and stock lending
Certain Group companies engage in Matched Principal brokerage 
whereby securities are bought from one counterparty and 
simultaneously sold to another counterparty. Settlement of such 
transactions are primarily on a delivery vs payment basis (‘DVP’) 
and typically take place within a few business days of the 
transaction date according to the relevant market rules and 
conventions. The amounts due from and payable to counterparties 
in respect of as yet unsettled Matched Principal transactions are 
shown gross, except where a netting agreement, which is legally 
enforceable at all times, exists and the asset and liability are either 
settled net or simultaneously.

Fair value hedges
Changes in the fair value of derivatives that are designated and 
qualify as fair value hedges are recorded in profit or loss except 
when the hedging instrument hedges an equity instrument 
designated at FVTOCI in which case it is recognised in other 
comprehensive income.

The Group acts as an intermediary between its customers for 
collateralised stock lending transactions. Such trades are complete 
only when both the collateral and stock for each side of the 
transaction are returned. The gross amounts of collateral due to 
and receivable are disclosed in the balance sheet as deposits paid 
for securities borrowed and deposits received for securities loaned.

The carrying amount of a hedged item not already measured at 
fair value is adjusted for the fair value change attributable to the 
hedged risk with a corresponding entry in profit or loss. For debt 
instruments measured at FVTOCI, the carrying amount is not 
adjusted as it is already at fair value, but the hedging gain or loss is 
recognised in profit or loss instead of other comprehensive income. 
When the hedged item is an equity instrument designated at 
FVTOCI, the hedging gain or loss remains in other comprehensive 
income to match that of the hedging instrument.

The Group undertakes Matched Principal broking involving 
simultaneous back-to-back derivative transactions with 
counterparties. These transactions are classified as financial 
instruments at fair value through profit or loss (‘FVTPL’) and are 
shown gross, except where a netting agreement, which is legally 
enforceable at all times, exists and the asset and liability are either 
settled net or simultaneously.

Annual Report and Accounts 2020
137

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

3. Summary of significant accounting policies continued
(n) Restricted Funds, Cash and cash equivalents
Cash comprises cash in hand and demand deposits which may 
be accessed without penalty. Cash equivalents comprise short-term 
highly liquid investments with a maturity of less than three months 
from the date of acquisition. For the purposes of the Consolidated 
Cash Flow Statement, cash and cash equivalents consist of cash 
and cash equivalents as defined above, net of outstanding bank 
overdrafts which are repayable on demand and form an integral 
part of the group’s cash management.

The Group holds money, and occasionally financial instruments, 
on behalf of customers (client monies) in accordance with local 
regulatory rules. Since the Group is not beneficially entitled to these 
amounts, they are excluded from the Consolidated Balance Sheet 
along with the corresponding liabilities to customers.

Restricted funds comprise amounts held with a central counterparty 
clearing house (‘CCP’), or a financial institution providing the 
Group with access to a CCP, and funds set aside for regulatory 
purposes, but excluding client money. The funds represent amounts 
for which the Group does not have immediate and direct access or 
for which regulatory requirements restrict its use.

In preparing the financial statements of the individual companies, 
transactions in currencies other than the functional currency are 
recorded at the rates of exchange prevailing on the dates of the 
transactions. Gains and losses arising from the settlement of these 
transactions, and from the retranslation of monetary assets and 
liabilities denominated in currencies other than the functional 
currency at rates prevailing at the balance sheet date, are 
recognised in the income statement. Non-monetary assets and 
liabilities denominated in currencies other than the functional 
currency that are measured at historical cost or fair value are 
translated at the exchange rate at the date of the transaction 
or at the date the fair value was determined.

For the purpose of presenting Consolidated Financial Statements, 
the assets and liabilities of the Group’s foreign operations are 
translated at exchange rates prevailing on the balance sheet date. 
Exchange differences arising are classified as other comprehensive 
income and transferred to the Group’s translation reserve. Such 
translation differences are recognised as income or as expense in 
the year in which the operation is disposed of. Income and expense 
items are translated at average exchange rates for the year, unless 
exchange rates fluctuate significantly during that year, in which 
case the exchange rates at the date of transactions are used.

(o) Interest bearing loans and borrowings
All loans and borrowings are initially recognised at fair value, 
being the consideration received net of issue costs associated with 
the borrowing.

(r) Taxation
The tax expense represents the sum of current tax payable arising in 
the year, movements in deferred tax and movements in tax provisions. 
The tax expense includes any interest and penalties payable.

After initial recognition, interest bearing loans and borrowings 
are measured at amortised cost using the effective interest rate 
method. Amortised cost is calculated taking into account any issue 
costs and any discounts or premium on settlement. Gains and losses 
are recognised in the income statement when the liabilities are 
derecognised, as well as through the amortisation process.

(p) Provisions
Provisions are recognised when the Group has a present obligation, 
legal or constructive, as a result of a past event where it is probable 
that this will result in an outflow of economic benefits that can be 
reliably estimated.

Provisions for restructuring costs are recognised when the Group 
has a detailed formal plan for the restructuring, which has been 
notified to affected parties.

(q) Foreign currencies
The individual financial statements of each Group company are 
prepared in the currency of the primary economic environment in 
which it operates, its functional currency. For the purpose of the 
Consolidated Financial Statements, the results and financial 
position of each Group company are expressed in Pounds Sterling, 
which is the functional currency of the Company and the 
presentation currency for the Consolidated Financial Statements.

The current tax payable arising in the year is based on taxable 
profit for the year using tax rates that have been enacted or 
substantively enacted by the balance sheet date, and any 
adjustment to tax payable in respect of prior years.

Deferred tax is accounted for using the balance sheet liability 
method in respect of temporary differences arising between the 
carrying amount of assets and liabilities in the Financial Statements 
and the corresponding tax basis used in the computation of taxable 
profit. Deferred tax liabilities are generally recognised for all 
temporary differences and deferred tax assets are recognised to 
the extent that it is probable that taxable profits will be available 
against which deductible temporary differences may be utilised. 
Temporary differences are not recognised if they arise from 
goodwill or from initial recognition of other assets and liabilities 
in a transaction which affects neither the tax profit nor the 
accounting profit.

Deferred tax liabilities are recognised for taxable temporary 
differences arising on investments in subsidiaries and associates, 
except where the Group is able to control the reversal of the 
temporary difference and it is probable that the temporary 
difference will not reverse in the foreseeable future.

Deferred tax is calculated at the rates that are expected to apply 
when the asset or liability is settled or when the asset is realised. 
Deferred tax is charged or credited in the income statement, 
except when it relates to items credited or charged directly to other 
comprehensive income or equity, in which case the deferred tax 
is also dealt with in other comprehensive income or equity.

Annual Report and Accounts 2020
138

(s) Leases
Definition of a lease
On transition to IFRS 16 the Group elected to apply the practical 
expedient not to reassess whether a contract was or contained a 
lease. The Group therefore applied IFRS 16 only to contracts that 
had been previously identified as leases, in accordance with IAS 17 
and IFRIC 4, before 1 January 2019. Thereafter the Group has 
applied the definition of a lease and related guidance to all lease 
contracts entered into or modified on or after 1 January 2019. 

The Group assesses whether a contract is, or contains, a lease if the 
contract conveys a right to control the use of an identified asset for 
a period of time in exchange for consideration. 

At inception or on reassessment of a contract that contains a 
lease component, the Group allocates the consideration in the 
contract to each lease and non-lease component on the basis of the 
relative stand-alone prices. However, for leases of properties the 
Group has elected not to separate non-lease components and will 
instead account for the lease and non-lease components as a single 
lease component. 

As a lessee
The Group has elected not to recognise right-of-use assets and lease 
liabilities for short-term leases (up to 12 months) and leases of low 
value assets (less than £3,500). The Group recognises the lease 
payments associated with these leases as an expense on a 
straight-line basis over the lease term.

The Group recognises a right-of-use asset and a lease liability at the 
lease commencement date, the date at which power to control the 
asset is obtained. The right-of-use asset is initially measured at cost, 
and subsequently at cost less any accumulated depreciation and 
impairment losses, and adjusted for certain remeasurements of the 
lease liability.

The lease liability is initially measured at the present value of the 
lease payments that are not paid at the commencement date, 
discounted using the interest rate implicit in the lease or, if that rate 
cannot be readily determined, the Group’s incremental borrowing 
rate reflecting the lease term and the country in which it resides. 
Generally, the Group uses its incremental borrowing rate as the 
discount rate.

The lease liability is subsequently increased by the interest cost 
on the lease liability and decreased by lease payments made. It is 
remeasured when there is a change in the future lease payments 
arising from a change in an index or a rate, a change in the 
estimate of the amount expected to be payable under a residual 
value guarantee, or as appropriate, changes in the assessment of 
whether a purchase or extension option is reasonably certain to be 
exercised or a termination option is reasonably certain not to be 
exercised. Where a lease contract is modified and the lease 
modification is not accounted for as a separate lease, the lease 
liability is remeasured based on the lease term of the modified 
lease by discounting the revised lease payments using a revised 
discount rate at the effective date of the modification. 

Lease cash flows are split into payments of principal and 
interest and are presented as financing and operating cash 
flows respectively.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

The Group has applied judgement to determine the lease term for 
some lease contracts in which it is a lessee that includes termination 
and/or renewal options and for leases which the Group has 
enforceable rights that extend the lease agreement. The 
assessment of whether the Group is reasonably certain to exercise 
such options or whether the Group is able to enforce its additional 
rights impacts the lease term, which affects the amount of lease 
liabilities and right-of-use assets recognised.

As a lessor
The Group sub-leases some of its leased properties. Where the 
Group is an intermediate lessor, it accounts for the head lease and 
the sub-lease as two separate contracts and classifies the sub-lease 
as either a finance or operating lease by reference to the right-of-
use asset arising from the head lease. 

Where sub-lease agreements are assessed as finance leases, the 
Group derecognises the right-of-use asset and records its interest in 
finance lease receivables. Lease receipts are apportioned between 
finance income and a reduction in the finance lease receivable. 
As required by IFRS 9, an allowance for expected credit losses is 
recognised on the finance lease receivables.

Where sub-leases are classified as operating leases, operating lease 
receipts are recognised in the income statement on a straight-line 
basis over the lease term.

(t) Retirement benefit costs
Defined contributions made to employees’ personal pension plans 
are charged to the income statement as and when incurred. 

For defined benefit retirement plans, the cost of providing the 
benefits is determined using the projected unit credit method. 
Actuarial gains and losses are recognised in full in the year in which 
they occur. They are recognised outside the income statement and 
are presented in other comprehensive income.

Past service cost is recognised in profit or loss when the plan 
amendment or curtailment occurs, or when the Group recognises 
related restructuring costs or termination benefits, if earlier. Gains 
or losses on settlement of a defined benefit plan are recognised 
when the settlement occurs.

The amount recognised in the balance sheet represents the net of 
the present value of the defined benefit obligation as adjusted 
for actuarial gains and losses and past service cost, and the fair 
value of plan assets. The Trust Deed provides the Group with an 
unconditional right to a refund of surplus assets assuming the full 
settlement of plan liabilities. In the ordinary course of business the 
Trustee has no rights to unilaterally wind up, or otherwise augment 
the benefits due to members of, the plan. Based on these rights, any 
net surplus in the plan would be recognised in full. Where such rights 
do not exist, or are no longer enforceable, the Group applies the 
requirements of IFRIC 14 and restricts recognition of the net surplus 
by applying an asset recognition ceiling. Changes in the asset 
ceiling are recorded in other comprehensive income.

Annual Report and Accounts 2020
139

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

3. Summary of significant accounting policies continued
(u) Share-based payments
The Group issues equity-settled share-based payments to certain 
employees. Equity-settled share-based payments are measured at 
fair value at the date of grant. The fair value determined at the 
grant date of the equity-settled share-based payments is expensed 
on a straight-line basis over the vesting period, based on the 
Group’s estimate of shares that will eventually vest. 

The fair value of share options issued is determined using 
appropriate valuation models. The expected life used in the models 
has been adjusted, based on management’s best estimate for the 
effects of non-transferability, exercise restrictions and behavioural 
considerations.

The estimated fair value of shares granted is based on the share 
price at grant date, reduced where shares do not qualify for 
dividends during the vesting period. Market-based performance 
conditions for equity-settled payments are reflected in the initial 
fair value of the award.

(v) Treasury and own shares
Where share capital recognised as equity is repurchased, the 
amount of the consideration paid, including directly attributable 
costs, net of any tax effects, is recognised as a deduction from 
equity. When treasury shares are sold or re-issued subsequently, 
the amount received is recognised as an increase in equity, and the 
resulting surplus or deficit on the transaction is transferred to or 
from retained earnings.

Shares repurchased from the open market are recorded in ‘own 
shares’ within reserves. Own shares issued to beneficiaries under 
share award plans are recorded as a transfer to retained earnings.

(w) Contingent liabilities
Contingent liabilities, which include certain guarantees and letters 
of credit pledged as collateral security, and contingent liabilities 
related to legal proceedings or regulatory matters where a possible 
outflow of economic benefit might occur, or where that outflow 
cannot be reliably estimated, are not recognised in the financial 
statements but are disclosed. 

(x) Accounting estimates and judgements
In the application of the Group’s accounting policies, the Directors 
are required to make judgements, estimates and assumptions 
about the carrying amounts of assets and liabilities that are not 
readily apparent from other sources. The estimates and associated 
assumptions are based on historical experience and other factors 
that are considered to be relevant. Actual results may differ from 
these estimates.

Estimates and assumptions are reviewed on an ongoing basis and 
revisions to accounting estimates are recognised in the period an 
estimate is revised. 

Judgements
Judgement is required when determining whether a present 
obligation exists. Professional advice is taken on the assessment 
of litigation and similar obligations.

Provisions for legal proceedings and regulatory matters typically
require a higher degree of judgement than other types of
provisions. When matters are at an early stage, accounting
judgements can be difficult because of the high degree of
uncertainty associated with determining whether a present
obligation exists, and estimating the probability and amount of
any outflows that may arise. As matters progress, management
and legal advisers evaluate on an ongoing basis whether
provisions should be recognised, revising previous estimates as
appropriate. At more advanced stages, it is typically easier to
make estimates around a better defined set of possible outcomes.

Estimates
Provisions for legal proceedings and regulatory matters remain 
very sensitive to the assumptions used in the estimate. There could 
be a wider range of possible outcomes for any pending legal 
proceedings, investigations or inquiries. As a result it is often not 
practicable to quantify a range of possible outcomes for individual 
matters. It is also not practicable to meaningfully quantify ranges 
of potential outcomes in aggregate for these types of provisions 
because of the diverse nature and circumstances of such matters 
and the wide range of uncertainties involved.

Notes 26 and 35 provide details of the Group’s provisions and 
contingent liabilities and the key sources of estimation uncertainty.

Impairment of goodwill and intangible assets
Judgements
Forecast cash flows is subject to a high degree of uncertainty in 
volatile market conditions. Under such circumstances, management 
tests goodwill for impairment more frequently than once a year 
when indicators of impairment exist. This ensures that the 
assumptions on which the cash flow forecasts are based continue to 
reflect current market conditions and management’s best estimate 
of future performance.

Estimates
The future cash flows of the CGUs are sensitive to the cash flows 
projected for the periods for which detailed forecasts are available 
and to assumptions regarding the long-term pattern of sustainable 
cash flows thereafter. 

The rates used to discount future expected cash flows can have a 
significant effect on a CGU’s valuation. The discount rate incorporates 
inputs reflecting a number of financial and economic variables, 
including the risk-free interest rate in the region concerned and 
a premium for the risk of the business being evaluated. These 
variables are subject to fluctuations in external market rates and 
economic conditions beyond management’s control.

The following are the critical judgements and estimates that 
the Directors have made in the process of preparing the 
Financial Statements.

Note 13 sets out the key sources of estimation uncertainty, the key 
assumptions made and the resultant sensitivity to reasonable 
possible changes in those assumptions.

Provisions and contingent liabilities
Provisions are established by the Group based on management’s 
assessment of relevant information and advice available at the 
time of preparing the Financial Statements. 

Annual Report and Accounts 2020
140

4. Segmental analysis 
Products and services from which reportable segments derive their revenues
The Group has a matrix management structure. The Group’s Chief Operating Decision Maker (‘CODM’) is the Executive Committee (‘Exco’) 
which operates as a general management committee under the direct authority of the Board. The Exco regularly reviews operating 
activity on a number of bases, including by geographical region and by business division. The Group considers that geographic segments 
represent the most appropriate view for the purposes of resource allocation and assessment of the nature and financial effects of the 
business activities in which the Group engages. These are the Group’s primary reportable segments under IFRS 8 ‘Operating Segments’. 

The Group’s performance is assessed by the CODM on the basis of adjusted performance that removes the effects of significant items from 
reported results. Significant items are items that management identify and consider separately in order to improve the understanding of 
the underlying trends and performance of the business, that would otherwise distort year-or-year comparison. These segmental results are 
therefore presented on an adjusted basis. 

In addition the Group has presented its adjusted results by business division: Global Broking, Energy & Commodities, Institutional 
Services, and Data & Analytics. Segmental income and expenses include transfers between segments and these transfers are conducted 
at arm’s length.

Information regarding the Group’s operating segments is reported below:

Analysis by geographic segment

2020

Revenue
Total front-office costs
Contribution
Employment and general and administrative expenses
Depreciation and impairment of property, plant and equipment and 
right-of-use assets1
Amortisation and impairment of intangibles1
Total management and support costs
Other operating income
Adjusted operating profit

EMEA
£m

888
(518)
370
(185)

(15)
(16)
(216)
6
160

Americas
£m

Asia Pacific
£m

670
(442)
228
(119)

(12)
(4)
(135)
3
96

236
(154)
82
(62)

(9)
–
(71)
5
16

Total
£m

1,794
(1,114)
680
(366)

(36)
(20)
(422)
14
272

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

1  Of the depreciation and impairment of property, plant and equipment and right-of-use asset and amortisation and impairment of intangible assets relating to EMEA, 

£29m (2019: £32m) arises in the UK.

2019

Revenue
Total front-office costs
Contribution
Employment and general and administrative expenses
Depreciation and impairment of property, plant and equipment and 
right-of-use assets
Amortisation and impairment of intangibles
Total management and support costs
Other operating income
Adjusted operating profit

EMEA
£m

900
(524)
376
(190)

(14)
(18)
(222)
10
164

Americas
£m

Asia Pacific
£m

687
(458)
220
(124)

(12)
(4)
(140)
5
94

246
(157)
89
(60)

(8)
(1)
(69)
1
21

Total
£m

1,833
(1,139)
694
(374)

(34)
(23)
(431)
16
279

There are no inter-segment sales included in the geographic segment revenue. 

The Company is domiciled in the UK. Revenue attributable services provided in the UK amounted to £826m (2019: £850m), the USA £636m 
(2019: £655m) and other countries £322m (2019: £328m).

Annual Report and Accounts 2020
141

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

4. Segmental analysis continued
Analysis by division

2020

Reported Revenue
 > External
 > Inter-division
Total front-office costs
 > External
 > Inter-division
Contribution
Total management and support costs
Other operating income
Adjusted operating profit

Global Broking
£m

Energy & 
Commodities
£m

Institutional 
Services
£m

Data & 
Analytics1
£m

Corporate  
Centre
£m

1,188
1,170
18
(734)
(734)
–
454
(260)
3
197

391
388
3
(261)
(261)
–
130
(78)
1
53

91
91
–
(69)
(69)
–
22
(15)
–
7

145
145
–
(71)
(50)
(21)
74
(10)
–
64

(21)
–
(21)
21
–
21
–
(59)
10
(49)

Total
£m

1,794
1,794
–
(1,114)
(1,114)
–
680
(422)
14
272

1  Contracts for the provision of Data & Analytics services gives the Group a right to revenue which corresponds directly with the value of the performance completed. The 

Group has applied the practical expedient in IFRS 15 and has not disclosed either the remaining amount due under the contract nor when the Group expects to recognise 
that amount.

Analysis by division

2019

Reported Revenue
 > External
 > Inter-division
Total front-office costs
 > External
 > Inter-division
Contribution
Total management and support costs
Other operating income
Adjusted operating profit

Global Broking
£m

Energy & 
Commodities
£m

Institutional 
Services
£m

Data &  
Analytics
£m

Corporate  
Centre
£m

1,262
1,244
18
(775)
(775)
–
487
(268)
2
221

382
379
3
(261)
(261)
–
121
(75)
–
46

75
75
–
(57)
(57)
–
18
(15)
–
3

135
135
–
(67)
(46)
(21)
68
(9)
–
59

(21)
–
(21)
21
–
21
–
(64)
14
50

Total
£m

1,833
1,833
–
(1,139)
(1,139)
–
694
(431)
(16)
279

Corporate centre represents the cost of Group and central functions that are not allocated to the Group’s divisions.

Annual Report and Accounts 2020
142

Significant items are centrally managed and controlled by the Group and are not allocated to regional or divisional segments. 

Analysis of Significant items

2020
Employment, compensation and benefits costs
 Premises and related costs
 Deferred consideration
  Credit relating to significant legal and regulatory settlements
 Pension scheme past service and settlement costs
 Acquisition costs
 Other general and administration costs
Total included within general and administration costs
Depreciation and impairment of property, plant and 
equipment and right-of-use assets
Amortisation and impairment of intangible assets
Impairment of other assets
Total included within operating costs
Included in other operating income
Total Significant items

Restructuring 
and other related 
costs
£m
6
2
–
–
1
–
9
12

Disposals. 
acquisitions and 
investment in 
new businesses
£m
–
–
2
–
–
11
–
13

1
–
1
20
–
20

–
39
1
53
–
53

Goodwill 
impairment
£m
–
–
–
–
–
–
–
–

–
–
21
21
–
21

2019
Employment, compensation and 
benefits costs
 Premises and related costs
 Deferred consideration
  Adjustments to provisions and contingent 
liabilities acquired
  Charge relating to significant legal and 
regulatory settlements
  Pension scheme past service and 
settlement costs
 Acquisition costs
 Other general and administration costs
Total included within general and 
administration costs
Depreciation and impairment of property, 
plant and equipment and right-of-use assets
Amortisation and impairment of 
intangible assets
Goodwill impairment
Total included within operating costs
Included in other operating income
Total Significant items

ICAP integration 
costs
£m

Restructuring and 
other related 
costs
£m

Disposals. 
acquisitions and 
investment in new 
businesses
£m

Goodwill 
impairment
£m

15
–
–

–

–

–
–
15

15

4

–
–
34
–
34

3
1
–

–

–

4
–
3

8

1

–
–
12
–
12

2
–
6

3

–

–
2
2

13

–

42
–
57
–
57

–
–
–

–

–

–
–
–

–

–

–
24
24
–
24

Settlements and 
provisions in 
connection with 
legal and 
regulatory 
matters
£m
–
–
–
(3)
–
–
5
2

–
–
–
2
(2)
–

Settlements and 
provisions in 
connection with 
legal and 
regulatory 
matters
£m

–
–
–

–

18

–
–
1

19

–

–
–
19
(9)
10

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Total
£m
6
2
2
(3)
1
11
14
27

1
39
23
96
(2)
94

Total
£m

20
1
6

3

18

4
2
21

55

5

42
24
146
(9)
137

Annual Report and Accounts 2020
143

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

4. Segmental analysis continued
The Group’s reported performance includes significant items. A reconciliation from adjusted operating profit, as considered by CODM, to 
Group reported performance is included:

Adjusted profit reconciliation

Adjusted operating profit
Significant items
Operating profit
Net finance costs
Profit before tax
Taxation on significant items
Taxation on adjusted profit before tax
Profit after tax
Share of profit from associates and joint ventures
Profit for the year

Other segmental information

Capital additions
EMEA – UK
EMEA – Other
Americas
Asia Pacific

Share-based compensation
EMEA – UK
Americas
Asia Pacific

Segment assets
EMEA – UK
EMEA – Other
Americas
Asia Pacific

Segment liabilities
EMEA – UK
EMEA – Other
Americas
Asia Pacific

Segment assets and liabilities exclude all inter-segment balances.

2020
Revenue by type
Name Passing brokerage
Executing Broker brokerage
Matched Principal brokerage
Data & Analytics price information fees

Annual Report and Accounts 2020
144

2020
£m
272
(94)
178
(49)
129
7
(55)
81
16
97

2020  
£m

52
1
2
1
56

2020  
£m

4
1
1
6

2019
£m
279
(137)
142
(49)
93
15
(55)
53
15
68

2019  
£m

23
–
4
6
33

2019  
£m

3
1
1
5

Non-current  
£m

Current  
£m

2020  
£m

2019  
£m

1,191
42
521
167
1,921

4,212
210
66,228
163
70,813

5,403
252
66,749
330
72,734

11,219
223
40,280
343
52,065

Non-current  
£m

Current  
£m

2020 
£m

2019  
£m

472
62
315
143
992

3,858
171
65,968
47
70,044

4,330
233
66,283
190
71,036

EMEA  
£m

Americas  
£m

657
39
90
102
888

416
54
168
32
670

Asia 
£m

219
3
3
11
236

10,161
208
39,782
184
50,335

Total  
£m

1,292
96
261
145
1,794

2019
Revenue by type
Name Passing brokerage
Executing Broker brokerage
Matched Principal brokerage
Data & Analytics price information fees

5. Operating costs

Broker compensation costs
Other staff costs
Other share-based payment charge
Charge relating to employee long-term benefits
Employee compensation and benefits
Technology and related costs
Premises and related costs
Adjustments to deferred consideration
Adjustments to provisions and contingent liabilities acquired
(Credit)/charge relating to significant legal and regulatory settlements
Pension scheme past service and settlement costs
Acquisition costs
Expected credit loss adjustment
Other administrative costs
General and administrative expenses
Depreciation of property, plant and equipment 
Depreciation of right-of-use assets 
Impairment of right-of-use assets 
Depreciation and impairment of property, plant and equipment and right-of-use assets
Amortisation of other intangible assets 
Amortisation of intangible assets arising on consolidation 
Amortisation and impairment of intangibles assets
Goodwill impairment 
Impairment of finance lease receivables
Impairment of associates
Impairment of other assets 

 EMEA  
£m

 Americas  
£m

680
20
106
94
900

417
57
182
31
687

Notes

31

32

26
37

15
16
16

14
13

13
22
17

Net foreign exchange gain amounted to £1m (2019: loss £8m) and are included in ‘other administrative costs’.

The analysis of auditor’s remuneration is as follows:

Audit of the Group’s annual accounts
Audit of the Company’s subsidiaries and associates pursuant to legislation
Total audit fees

Audit related assurance services¹
Other assurance services²
Corporate finance services3
Total non-audit fees

Audit fees payable to the Company’s auditor and its associates in respect of associated pension schemes

1  Audit related assurance services relate to services required by law or regulation, assurance on regulatory returns and review of interim financial information.
2  Other assurance services relate to non-statutory audits and other permitted assurance services.
3  Corporate finance fees relate to work undertaken in connection with the Group’s re-domiciliation to Jersey and the proposed acquisition of Liquidnet.

Annual Report and Accounts 2020
145

Asia 
£m

230
4
2
10
246

2020  
£m
902
244
6
1
1,153
167
29
2
–
(3)
1
11
(6)
159
360
13
23
1
37
20
39
59
21
1
1
23
1,632

2020 
£000
881
5,446
6,327

1,066
69
464
1,599

22

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Total  
£m

1,327
81
290
135
1,833

2019 
£m
900
248
5
1
1,154
158
27
6
3
18
4
2
–
217
435
13
21
–
34
27
42
69
24
–
–
24
1,716

2019 
£000
462
5,679
6,141

1,034
884
–
1,918

22

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

6. Other operating income
Other operating income include:

Business relocation grants
Employee related insurance receipts
Management fees
Legal settlement receipts
Other receipts

2020 
£m
3
2
3
2
6
16

2019 
£m
3
2
1
9
10
25

Other receipts include royalties, rebates, non-employee related insurance proceeds, tax credits and refunds. Costs associated with such 
items are included in administrative expenses.

7. Staff costs
The average monthly number of full-time equivalent employees and Directors of the Group was:

2020 
No.
2,362
1,518
1,067
4,947

2020 
£m
1,041
87
19
6
1,153

2020 
£m
2
1
3

2020 
£m
2
1
–
23
13
1
1
41
11
–
52

2019 
No.
2,272
1,549
1,037
4,858

2019 
£m
1,048
84
17
5
1,154

2019 
£m
5
1
6

2019
£m
2
1
2
24
8
1
2
40
12
3
55

EMEA
Americas
Asia Pacific

The aggregate employment costs of staff and Directors of the Group were:

Wages, salaries, bonuses and incentive payments
Social security costs
Defined contribution pension costs (Note 37(c))
Share-based compensation expense

8. Finance income

Interest receivable and similar income
Interest receivable on finance leases (Note 22)

9. Finance costs

Fees payable on bank and other loan facilities
Interest payable on bank and other loans
Interest payable on Sterling Notes June 2019
Interest payable on Sterling Notes January 2024
Interest payable on Sterling Notes May 2026
Other interest payable
Amortisation of debt issue and bank facility costs
Borrowing costs
Interest payable on lease liabilities (Note 16)
Premium on repurchase of Sterling Notes January 2024

Annual Report and Accounts 2020
146

10. Taxation

Current tax
UK corporation tax
Overseas tax
Prior year UK corporation tax 
Prior year overseas tax

Deferred tax (Note 21)
Current year
Prior year 

Tax charge for the year

The charge for the year can be reconciled to the profit in the income statement as follows:

Profit before tax
Tax based on the UK corporation tax rate of 19% (2019: 19%) 
Tax effect of items that are not deductible:
 > expenses
 > impairment of intangible assets arising on consolidation
Prior year adjustments
Impact of tax rate change
Impact of overseas tax rates
Tax charge for the year

2020
£m

27
27
(3)
–
51

(4)
1
(3)
48

2020  
£m
129
25

8
4
(2)
4
9
48

In addition to the income statement charge, the following current and deferred tax items have been included in other comprehensive 
income and equity:

2020
Deferred tax credit relating to:
 > Decrease in the defined benefit pension scheme surplus (Note 37)
 > Other temporary differences
Tax charge on items taken directly to other comprehensive  
income and equity

2019
Deferred tax credit relating to:
 > Decrease in the defined benefit pension scheme surplus (Note 37)
 > Other temporary differences
Tax credit on items taken directly to other comprehensive  
income and equity

Recognised
in other 
comprehensive
income
£m

Recognised 
in equity 
£m

–
1

1

(19)
–

(19)

–
–

–

–
–

–

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019 
£m

23
32
(3)
–
52

(12)
–
(12)
40

2019  
£m
93
18

12
5
(3)
–
8
40

Total 
£m

–
1

1

(19)
–

(19)

Annual Report and Accounts 2020
147

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

11. Earnings per share

Basic 
Diluted 

The calculation of basic and diluted earnings per share is based on the following number of shares:

Basic weighted average shares
Contingently issuable shares
Diluted weighted average shares

The earnings used in the calculation of basic and diluted earnings per share are set out below:

Earnings for the year 
Non-controlling interests
Earnings attributable to equity holders of the parent

12. Dividends

Amounts recognised as distributions to equity holders in the year:
Final dividend for the year ended 31 December 2019 of 11.25p per share
Interim dividend for the year ended 31 December 2020 of 5.6p per share
Final dividend for the year ended 31 December 2018 of 11.25p per share
Interim dividend for the year ended 31 December 2019 of 5.6p per share

Dividends in respect of the current year and future dividend policy are discussed in the Strategic Report.

During the year, the Trustees of the TP ICAP plc Employee Benefit Trust waived their rights to dividends.

13. Intangible assets arising on consolidation

At 1 January 2020
Recognised on acquisitions 
Amortisation of acquisition related intangibles
Impairment of acquisition related intangibles
Effect of movements in exchange rates
At 31 December 2020

At 1 January 2019
Recognised on acquisitions 
Remeasurement period adjustments:
 > Remeasurement of other intangible assets
 > Increase in net assets acquired
Amortisation of acquisition related intangibles
Impairment of acquisition related intangibles
Effect of movements in exchange rates
At 31 December 2019

Goodwill 
£m
993
25
–
(21)
(8)
989

1,030
7

(5)
(2)
–
(24)
(13)
993

2020
17.2p
17.0p

2020
No.(m)
557.0
6.9
563.9

2020 
£m
97
(1)
96

2020
£m

63
31
–
–
94

Other 
£m
518
–
(39)
–
(5)
474

564
–

5
–
(42)
–
(9)
518

2019
12.0p
11.9p

2019 
No.(m)
559.4
4.2
563.6

2019 
£m
68
(1)
67

2019 
£m

– 
–
63
31
94

Total 
£m
1,511
25
(39)
(21)
(13)
1,463

1,594
7

–
(2)
(42)
(24)
(22)
1,511

Other intangible assets at 31 December 2020 represent customer relationships, £469m (2019: £506m), business brands and trademarks, 
£5m (2019: £10m), and other intangibles, £nil (2019: £2m) that arise through business combinations. Customer relationships are being 
amortised between 10 and 20 years.

Annual Report and Accounts 2020
148

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Goodwill arising through business combinations is allocated to groups of individual cash-generating units (‘CGUs’), reflecting the lowest 
level at which the Group monitors and tests goodwill for impairment purposes. The Group’s CGUs are as follows:

CGU
EMEA
Americas
Asia Pacific
Goodwill allocated to CGUs

2020
£m

686
253
50
989

2019
£m

663
262
68
993

CGUs, to which goodwill has been allocated, are tested for impairment at least annually. Review for indicators of impairment are 
undertaken at each reporting date. During the year the Group undertook impairment tests as at 30 June and as at 30 September, 
triggered as a result of sensitivity of the Asia Pacific CGU to reasonable possible changes in cash flow and discount rate assumptions.

Determining whether goodwill is impaired requires an estimation of the recoverable amount of each CGU. The recoverable amount is the 
higher of its value in use (‘VIU’) or its fair value less cost of disposal (‘FVLCD’). VIU is a pre-tax valuation, using pre-tax cash flows and 
pre-tax discount rates which is compared to the pre-tax carrying value of the CGU, whereas FVLCD is a post-tax valuation, using post-tax 
cash flows, post-tax discount rates and other post-tax observable valuation inputs, which is compared to a post-tax carrying value of 
the CGU. 

The key assumptions for the VIU calculations are those regarding expected regional cash flows arising in future years, regional growth 
rates and regional discount rates as considered by management. Regional specific assumptions reflect the divisional mix in each region 
and the size and risk profile of that region. Future projections are based on the most recent financial projections considered by the Board 
which are used to project pre-tax cash flows for the next five years. After this period a steady state cash flow is used to derive a terminal 
value for the CGU. 

As at 30 June 2020, the recoverable amount for the Asia Pacific CGU was estimated to be lower than its carrying value by £21m and was 
impaired by that amount. Growth rates on underlying revenues were 1.4% (2019: 2.1%) for EMEA, 1.1% (2019: 1.6%) for Americas and 2.0% 
(2019: 1.2%) for Asia Pacific over the five-year projected period, with pre-tax discount rates of 10.6% (2019: 11.0%) for EMEA, 13.2% (2019: 
13.6%) for Americas and 11.6% (2019: 11.6%) for Asia Pacific. 

As at 30 September 2020, growth rates on underlying revenues were 1.8% for EMEA, 0.8% for Americas and 1.5% for Asia Pacific over the 
five-year projected period, with pre-tax discount rates of 11.0% for EMEA, 13.4% for Americas and 11.8% for Asia Pacific. No further 
impairment was identified.

As at 31 December 2020, the review of the indicators of impairment did not result in a requirement to undertake further impairment testing.

The Asia Pacific CGU remains sensitive to reasonably possible changes in the VIU assumptions. Further impairment of the Asia Pacific CGU 
would be required if there are changes in the applicable assumptions. A reduction in the growth rate over the period by 0.5% would result 
in a reduction in the value of the CGU by £25m and a 1% increase in the discount rate would reduce the value of the CGU by £13m. A 
permanent 5% reduction in projected 2021 revenues in each CGU would lead to a £52m reduction in the value of the Asia Pacific CGU and 
result in an impairment of £2m. The impact on future cash flows resulting from falling growth rates does not reflect any management 
actions that would be taken under such circumstances.

The recoverable amounts of EMEA and Americas CGUs continue to be in excess of their carrying value and are not sensitive to reasonable 
possible changes in the VIU assumptions.

Annual Report and Accounts 2020
149

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

14. Other intangible assets

Cost
At 1 January 2020
Additions
Amounts derecognised
Effect of movements in exchange rates
At 31 December 2020
Accumulated amortisation
At 1 January 2020
Charge for the year
Amounts derecognised
Effect of movements in exchange rates
At 31 December 2020
Carrying amount
At 31 December 2020

Cost
At 1 January 2019
Additions
Amounts derecognised
Effect of movements in exchange rates
At 31 December 2019
Accumulated amortisation
At 1 January 2019
Charge for the year
Amounts derecognised
Effect of movements in exchange rates
At 31 December 2019
Carrying amount
At 31 December 2019

Purchased 
software 
£m

Developed 
software 
£m

23
–
(1)
1
23

(17)
(3)
1
(1)
(20)

3

23
2
(1)
(1)
23

(14)
(5)
1
1
(17)

6

140
16
(6)
(1)
149

(85)
(17)
6
2
(94)

55

125
18
(1)
(2)
140

(65)
(22)
1
1
(85)

55

Total 
£m

163
16
(7)
–
172

(102)
(20)
7
1
(114)

58

148
20
(2)
(3)
163

(79)
(27)
2
2
(102)

61

Annual Report and Accounts 2020
150

15. Property, plant and equipment

Cost
At 1 January 2020
Additions
Interest capitalised as leasehold improvements (Note 16)
Depreciation capitalised as leasehold improvements (Note 16)
Disposals
Effect of movements in exchange rates
At 31 December 2020
Accumulated depreciation
At 1 January 2020
Charge for the year
Disposals
Effect of movements in exchange rates
At 31 December 2020
Carrying amount
At 31 December 2020

Cost
At 1 January 2019
Additions
Disposals
Effect of movements in exchange rates
At 31 December 2019
Accumulated depreciation
At 1 January 2019
Charge for the year
Disposals
Effect of movements in exchange rates
At 31 December 2019
Carrying amount
At 31 December 2019

Land, buildings 
and leasehold 
improvements 
£m

Furniture, 
fixtures, 
equipment and 
motor vehicles 
£m

60
6
3
5
(1)
1
74

(14)
(7)
1
(2)
(22)

52

54
11
(2)
(3)
60

(11)
(7)
2
2
(14)

46

74
29
–
–
(1)
(1)
101

(48)
(6)
1
1
(52)

49

79
2
(4)
(3)
74

(48)
(6)
3
3
(48)

26

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Total 
£m

134
35
3
5
(2)
–
175

(62)
(13)
2
(1)
(74)

101

133
13
(6)
(6)
134

(59)
(13)
5
5
(62)

72

Annual Report and Accounts 2020
151

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

16. Right-of-use assets

At 1 January 2020
Additions
Acquired as part of acquisitions
Modifications
Depreciation
Depreciation capitalised as leasehold improvements (Note 15)
Impairment
Effect of movements in exchange rates
At 31 December 2020

At 1 January 2019
Additions and modifications
Modifications
Depreciation
Impairment
Effect of movements in exchange rates
At 31 December 2019

Land, buildings 
and leasehold 
improvements 
£m
90
82
5
15
(23)
(5)
(1)
(1)
162

Land, buildings 
and leasehold 
improvements 
£m
100
18
(4)
(21)
–
(3)
90

Furniture, 
fixtures, 
equipment and 
motor vehicles 
£m
1
–
–
–
–
–
–
–
1

Furniture, 
fixtures, 
equipment and 
motor vehicles 
£m
1
–
–
–
–
–
1

Total 
£m
91
82
5
15
(23)
(5)
(1)
(1)
163

Total 
£m
101
18
(4)
(21)
–
(3)
91

The Group leases several buildings which have an average lease term of 11 years (2019: 10 years).

Additions and modifications to right-of-use assets were £102m, £78m (including stamp duty of £2m) of which is for new leases for the 
Group’s London-based headquarters and broking operations. Under an agreement with the landlord, two existing London property leases 
will be terminated once the Group has moved its operations to several floors in the newly leased building. The new leases commenced in 
January and June 2020 at a weighted average incremental borrowing rate of 5.32% and the leased space will be further developed 
during 2021 enabling the transfer of operations during the first half of 2021. During the development phase of these leased spaces the 
depreciation and lease interest expense is being capitalised as a direct cost of the leasehold improvements being undertaken. During the 
period to 31 December 2020 £8m has been capitalised, of which £5m relates to depreciation and £3m to interest in lease liabilities.

The maturity analysis of lease liabilities is presented in Note 25.

Amounts recognised in profit and loss

Depreciation expense on right-of-use assets 
Interest expense on lease liabilities
Expense relating to short-term leases
Interest income from sub-leasing right-of-use assets

2020
£m
23
11
1
(1)

2019 
£m
21
12
2
(1)

At 31 December 2020, the Group is committed to £1m (2019: £2m) for short-term leases (Note 36). The total cash outflow for leases amounts 
to £38m (2019: £33m) (representing principal repayment of £24m (2019: £24m) and interest of £14m (2019: £12m), of which £3m has been 
capitalised (2019: nil)).

Annual Report and Accounts 2020
152

17. Investment in associates 

At 1 January 
Additions
Transfer to subsidiaries
Impairments
Share of profit for the year
Dividends received
Effect of movements in exchange rates
At 31 December
Summary financial information for associates
Aggregated amounts (for associates at the year end):
Total assets
Total liabilities
Net assets
Proportion of Group’s ownership interest
Goodwill
Carrying amount of Group’s ownership interest
Aggregated amounts (for associates during the year):
Revenue
Profit for the year
Group’s share of profit for the year
Dividends received from associates during the year

2020 
£m
58
2
(1)
(1)
12
(11)
2
61

319
(131)
188
59
2
61

228
37
12
11

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019 
£m
53
5
–
–
11
(8)
(3)
58

267
(87)
180
56
2
58

223
35
11
8

Interests in associates are measured using the equity method. All associates are involved in broking activities and have either a 31 December 
or 31 March year end. The results and assets and liabilities of associates are incorporated in these Financial Statements based on financial 
information made up to 31 December each year. No individual associate is material to the Group. 

Country of incorporation 
and operation
Bahrain
China

England

India
Japan

Spain
United States

1  31 March year end.

Associated undertakings
ICAP (Middle East) W.L.L.
Tullett Prebon SITICO (China) Limited
Enmore Commodity Brokers (Shanghai) Limited
Glia Ecosystems Limited
Zodiac Seven Limited
ICAP IL India Private Limited1
Totan ICAP Co., Ltd1
Central Totan Securities Co. Ltd1
Corretaje e Informacion Monetaria y de Divisas SA
First Brokers Securities LLC1

Percentage
held
49%
33%
49%
28%
41.3%
40%
40%
20%
21.5%
40%

Annual Report and Accounts 2020
153

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

18. Investment in joint ventures

At 1 January 
Additions
Share of result for the year 
Dividends received
Effect of movements in exchange rates
At 31 December
Summary financial information for joint ventures
Aggregated amounts (for joint ventures at the year end):
Total assets
Total liabilities
Net assets
Proportion of Group’s ownership interest
Goodwill
Carrying amount of Group’s ownership interest
Aggregated amounts (for joint ventures during the year):
Revenue
Result for the year
Group’s share of result for the year
Dividends received from joint ventures during the year

2020 
£m
28
1
4
(2)
(2)
29

25
(4)
21
10
19
29

14
7
4
2

Interests in joint ventures are measured using the equity method. All joint ventures are involved in broking activities and have 
a 31 December year end. No individual joint venture is material to the Group.

Country of incorporation 
and operation
Colombia

Indonesia
Mexico

19. Other investments

Joint ventures
SET-ICAP FX SA
SET-ICAP Securities S.A.
PT Electronic IDR Exchange
SIF ICAP, S.A. de C.V.

At 1 January 
Additions
Disposals
Revaluation of equity instruments at FVTOCI
Effect of movements in exchange rates
At 31 December

Categorisation of other investments:
Debt instruments at FVTOCI – corporate debt securities
Equity instruments at FVTOCI

2020 
£m
20
–
(2)
–
–
18

2
16
18

2019 
£m
26
–
4
(2)
–
28

22
(4)
18
9
19
28

15
8
4
2

Percentage 
held
47.9%
47.4%
49%
50%

2019 
£m
20
1
(1)
1
(1)
20

2
18
20

The fair values are based on valuations as disclosed in Note 28(h). Equity instruments comprise securities that do not qualify as associates 
or joint ventures.

Annual Report and Accounts 2020
154

20. Financial investments

Debt instruments at FVTOCI – Government debt securities
Investments at amortised cost – Term deposits and restricted funds

2020
£m
87
40
127

Debt instruments, term deposits and restricted funds are liquid instruments held with financial institutions and central counterparty 
clearing houses providing the Group with access to clearing services. 

21. Deferred tax

Deferred tax assets
Deferred tax liabilities

The movement for the year in the Group’s net deferred tax position was as follows:

At 1 January
Credit to income for the year
(Charge)/credit to other comprehensive income for the year
Effect of movements in exchange rates
At 31 December

2020
£m
4
(79)
(75)

2020
£m
(80)
3
(1)
3
(75)

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019 
£m
87
61
148

2019
£m
3
(83)
(80)

2019
£m
(119)
12
19
8
(80)

Annual Report and Accounts 2020
155

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

21. Deferred tax continued
Deferred tax balances and movements thereon are analysed as: 

At 
1 January 
£m

Recognised 
in equity 
£m

Recognised 
in profit 
or loss 
£m

Recognised 
in other 
comprehensive
income
£m

Recognised 
with 
acquisitions
£m

Effect of
movements
in exchange
rates 
£m

At
31 December
£m

2020
Share-based payment awards
Defined benefit pension scheme
Tax losses
Bonuses
Intangible assets arising on 
consolidation
Other timing differences

2019
Share-based payment awards
Defined benefit pension scheme
Tax losses
Bonuses
Intangible assets arising on 
consolidation
Other timing differences

4
–
3
9

(105)
9
(80)

3
(19)
5
1

(114)
5
(119)

–
–
–
–

–
–
–

–
–
–
–

–
–
–

(1)
–
2
–

2
–
3

1
–
(3)
6

6
2
12

–
–
–
–

–
(1)
(1)

–
19
–
–

–
–
19

–
–
–
–

–
–
–

–
–
–
–

–
–
–

–
–
–
–

2
1
3

–
–
1
2

3
2
8

3
–
5
9

(101)
9
(75)

4
–
3
9

(105)
9
(80)

At the balance sheet date, the Group has gross unrecognised temporary differences of £107m with the unrecognised net tax amount being 
£23m (2019: gross £144m and net tax £30m respectively). This includes gross tax losses of £103m with the net tax amount being £22m (2019: 
gross £131m and net tax £27m respectively), which are potentially available for offset against future profits. Of the unrecognised gross losses 
£24m (2019: £41m) are expected to expire within 20 years and £79m (2019: £90m) have no expiry date. Deferred tax assets have not been 
recognised in respect of these items since it is not probable that future taxable profits will arise against which the temporary differences may 
be utilised.

The net deferred tax position at 31 December 2020 includes a deferred tax asset of £5m (2019: £3m) in respect of losses which has been 
recognised as at 31 December 2020 as it was considered probable that future tax profits should arise.

No deferred tax has been recognised on temporary differences associated with unremitted earnings of subsidiaries as the Group is able to 
control the timing of distributions and overseas dividends are largely exempt from UK tax. As at the balance sheet date, the Group had 
unrecognised deferred tax liabilities of £2m (2019: £2m) in respect of unremitted profits of subsidiaries of £27m (2019: £25m).

On 3 March 2021, the UK Government announced a proposed increase in the rate of corporation tax from 19% to 25%, effective from 
1 April 2023. If the increase in corporation tax rate is enacted as announced, there is expected to be a £17m increase in the deferred tax 
liability recognised in respect of intangible fixed assets, based on the deferred tax liability as at 31 December 2020, with the corresponding 
charge to the income statement being classified within tax on significant items. This will be partially offset by a £3m increase in the 
deferred tax asset recognised in respect of other temporary differences, with the corresponding credit to the income statement being 
classified within tax on adjusted profit before tax.

Annual Report and Accounts 2020
156

22. Trade and other receivables

Non-current receivables
Finance lease receivables
Other receivables

Current receivables
Trade receivables
Settlement balances
Deposits paid for securities borrowed
Finance lease receivables
Other debtors
Accrued income
Owed by associates and joint ventures
Prepayments
Corporation tax

2020
£m

5
19
24

301
68,487
1,115
1
15
11
5
90
2
70,027

2019 
£m

7
19
26

301
48,295
652
1
17
10
3
91
1
49,371

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

The Directors consider the carrying amount of trade and other receivables which are not held at fair value through profit or loss 
approximate to their fair values as they are short term in nature. No interest is charged on outstanding trade receivables.

The Group measures the loss allowance for trade receivables at an amount equal to the lifetime expected credit loss. The expected credit 
losses on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of 
the debtor’s current financial position, adjusted for factors that are specific to the debtors, general economic conditions and an assessment 
of both the current as well as the forecast direction of conditions at the reporting date. 

The following table details the risk profile of trade receivables based on the Group’s provision matrix by region. As the Group’s historical 
credit loss experience does not show significantly different loss patterns for different regional customer segments, the provision for loss 
allowance based on past due status is not further distinguished between the Group’s different customer base. 

Not past due
£m

Less than
30 days
past due
£m

31 – 60
days 
past due
£m

61 – 90
days
past due
£m

Greater than
91 days
past due
£m

87
45
21
153
%
0.09
0.18
0.35

49
47
18
114
%
1.36
0.69
0.73

20
18
4
42
%
0.69
0.38
1.23

34
17
8
59
%
1.84
1.04
1.29

13
9
3
25
%
0.81
0.51
1.33

21
13
5
39
%
3.71
1.63
2.82

7
6
2
15
%
1.56
0.92
3.25

15
7
3
25
%
4.00
2.37
4.73

43
21
7
71
%
3.79
6.75
14.73

42
20
14
76
%
10.14
7.28
9.35

Total
£m

170
99
37
306

(5)
301

161
104
48
313

(12)
301

Trade receivables
2020
EMEA
Americas
Asia Pacific
Gross balances outstanding
Expected credit loss rate
EMEA
Americas
Asia Pacific
Lifetime ECL

2019
EMEA
Americas
Asia Pacific
Gross balances outstanding
Expected credit loss rate
EMEA
Americas
Asia Pacific
Lifetime ECL

Annual Report and Accounts 2020
157

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

22. Trade and other receivables continued
As at 31 December settlement balances that were due and those that were past due were as follows:

Settlement balances
2020
EMEA
Americas
Total

2019
EMEA
Americas
Total

Total
£m

Not past due
£m

Less than 
90 days
past due
£m

Greater than 
91 days
past due
£m

3,710
64,777
68,487

9,636
38,659
48,295

3,708
64,777
68,485

9,636
38,657
48,293

2
–
2

–
2
2

–
–
–

–
–
–

Settlement balances arise on Matched Principal brokerage whereby securities are bought from one counterparty and simultaneously sold 
to another counterparty. Settlement of such transactions is primarily on a delivery vs payment basis (‘DVP’) and typically take place within 
a few business days of the transaction date according to the relevant market rules and conventions. The amounts due from and payable to 
counterparties in respect of as yet unsettled Matched Principal transactions are shown gross, except where a netting agreement, which is 
legally enforceable at all times, exists and the asset and liability are either settled net or simultaneously. The above analysis reflects only 
the receivable side of such transactions. Corresponding payable amounts are shown in Note 23 ‘Trade and other payables’. The Group 
measures loss allowances for settlement balances under the general approach reflecting the probability of default based on the credit 
rating of the counterparty together with an assessment of the loss, after the sale of underlying instruments, that could arise as a result of 
default. As at 31 December 2020, the provision for expected credit losses amounted to less than £1m (2019: less than £1m).

Deposits paid for securities borrowed arise on collateralised stock lending transactions. Such trades are complete only when both the 
collateral and stock for each side of the transaction are returned. The above analysis reflects the receivable side of such transactions. 
Corresponding deposits received for securities loaned are shown in Note 23 ‘Trade and other payables’. The Group measures loss 
allowances for these balances under the general approach reflecting the probability of default based on the credit rating of the 
counterparty together with an assessment of the loss, after the sale of collateral, that could arise as a result of default. As at 31 December 
2020, the provision for expected credit losses amounted to less than £1m (2019: less than £1m).

Amounts receivable under finance leases:

Year 1
Year 2
Year 3
Year 4
Year 5
Onwards
Undiscounted lease payments
Less: unearned finance income
Present value of lease payments receivable
Net investment in the lease

Undiscounted lease payments analysed as:

Recoverable after 12 months
Recoverable within 12 months

Annual Report and Accounts 2020
158

2020
£m
1
2
1
1
1
1
7
(1)
6
6

2020
£m
6
1

2019
£m
1
2
2
2
1
2
10
(2)
8
8

2019
£m
9
1

Net investment in the lease analysed as:

Recoverable after 12 months
Recoverable within 12 months

2020
£m
5
1

The Group is not exposed to foreign currency risk as a result of the lease arrangements, as all leases are denominated in the respective 
functional currencies of the recording entities. 

The following table presents the amounts included in profit or loss.

Impairment of finance lease receivables
Finance income on the net investment in finance leases

The Group’s finance lease arrangements do not include variable payments.

The average effective interest rate contracted approximates 8.73% per annum.

2020
£m
(1)
1

2019
£m
7
1

2019
£m
–
1

The directors of the Company estimated the loss allowance on finance lease receivables at the end of the reporting year at an amount 
equal to lifetime ECL. None of the finance lease receivables at the end of the reporting year is past due, and taking into account the 
historical default experience and the future prospects of the industries in which the lessees operate, the directors of the Company consider 
that no finance lease receivable is impaired.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

23. Trade and other payables

Trade payables
Settlement balances
Deposits received for securities loaned
Deferred consideration (Note 32(d))
Other creditors
Accruals
Owed to associates and joint ventures
Tax and social security
Deferred income

2020
£m
23
68,476
1,106
12
13
270
3
23
1
69,927

The directors consider that the carrying amount of trade and other payables which are not held at fair value through profit or loss 
approximate to their fair values.

24. Loans and borrowings 

2020
Overdrafts
Loans from related party
Sterling Notes January 2024
Sterling Notes May 2026

2019
Sterling Notes January 2024
Sterling Notes May 2026

Less than 
one year 
£m 

Greater than
one year 
£m

7
28
10
1
46

10
1
11

–
–
430
249
679

430
248
678

2019 
£m
25
48,275
652
23
15
289
3
22
1
49,305

Total 
£m

7
28
440
250
725

440
249
689

All amounts are stated after unamortised transaction costs. An analysis of borrowings by maturity has been disclosed in Note 28(e).

Overdrafts
Overdrafts arising as a result of settling security transactions pending the completion of the onward sale.

Annual Report and Accounts 2020
159

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

24. Loans and borrowings continued
Bank credit facilities and bank loans
The Group has a £270m committed revolving facility that matures in December 2023. Facility commitment fees of 0.8% on the undrawn 
balance are payable on the facility. Arrangement fees of £3m are being amortised over the maturity of the facility.

As at 31 December 2020, the revolving credit facility was undrawn. Amounts drawn down are reported as bank loans in the above table. 
Bank loans are denominated in Sterling. During the year, the maximum amount drawn was £161m (2019: £39m), and the average amount 
drawn was £39m. The Group utilises the credit facility throughout the year, entering into numerous short-term bank loans where maturities 
are less than three months. The turnover is quick and the volume is large and resultant flows are presented net in the Group’s cash flow 
statement in accordance with IAS 7 ‘Cash Flow’.

Interest and facility fees of £3m were incurred in 2020 (2019: £3m).

Loans from related parties
In August 2020, the Group entered into a Yen 10bn committed facility with The Tokyo Tanshi Co., Ltd, a related party, that matures in 
February 2023. As at 31 December, the 10bn Yen committed facility equated to £71m. Facility commitment fees of 0.64% on the undrawn 
balance are payable on the facility. Arrangement fees of less than £1m are being amortised over the maturity of the facility.

As at 31 December 2020, Yen 4bn (£28m) of the facility was drawn. The Directors consider that the carrying amount of the loan which is not 
held at fair value through profit or loss approximates to its fair value. During the year, the maximum amount drawn was £75m, and the 
average amount drawn was £36m. The Group utilises the credit facility throughout the year, entering into numerous short-term bank loans 
where maturities are less than three months. The turnover is quick and the volume is large and resultant flows are presented net in the 
Group’s cash flow statement in accordance with IAS 7 ‘Cash Flow’.

Interest and facility fees of less than £1m were incurred in 2020.

Amounts drawn down are reported as loans from related parties in the above table.

Sterling Notes: Due January 2024
In January 2017 the Group issued £500m unsecured Sterling Notes due January 2024. The Notes have a fixed coupon of 5.25% payable 
semi-annually, subject to compliance with the terms of the Notes. In May 2019, the Group repurchased £69m of the Notes. At 31 December 
2020, the fair value of the Notes (Level 1) was £473m. Accrued interest at 31 December 2020 amounted to £10m. Unamortised issue costs 
were £1m.

Interest of £23m was incurred in 2020 (2019: £24m). The amortisation expense of issue costs in 2020 and 2019 were less than £1m.

Sterling Notes: Due May 2026
In May 2019 the Group issued £250m unsecured Sterling Notes due May 2026. The Notes have a fixed coupon of 5.25% paid semi-annually, 
subject to compliance with the terms of the Notes. At 31 December 2020 the fair value of the Notes (Level 1) was £284m. Accrued interest 
at 31 December 2020 amounted to £1m. Unamortised issue costs were £1m.

Interest of £13m was incurred in 2020 (2019: £8m). Issue costs of £1m were incurred in 2019 and their amortisation expense in 2020 and 
2019 was less than £1m.

25. Lease liabilities
Maturity analysis

Year 1
Year 2
Year 3
Year 4
Year 5
Onwards

Less: future interest expense

Analysed as:

Included in current liabilities
Included in non-current liabilities

Annual Report and Accounts 2020
160

2020
£m
38
30
29
24
31
137
289
(77)
212

2020
£m
26
186
212

2019
£m
33
25
21
20
15
91
205
(65)
140

2019
£m
23
117
140

26. Provisions

2020
At 1 January 2020
Charge/(credit) to income statement
Utilisation of provision
Effect of movements in exchange rates
At 31 December 2020

2019
At 1 January 2019
Adoption of IFRS 16:
 > onerous lease provisions offset against right-of-use assets
Charge to income statement
Utilisation of provision
Effect of movements in exchange rates
At 31 December 2019

Included in current liabilities
Included in non-current liabilities

Property 
£m

Restructuring
£m

Legal 
and other
£m

6
2
(1)
–
7

14

(7)
–
–
(1)
6

8
8
(7)
–
9

10

–
8
(10)
–
8

33
(5)
(4)
–
24

37

–
23
(26)
(1)
33

2020
£m
17
23
40

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Total 
£m

47
5
(12)
–
40

61

(7)
31
(36)
(2)
47

2019 
£m
21
26
47

Property provisions outstanding as at 31 December 2020 relate to provisions in respect of building dilapidations, representing the 
estimated cost of making good dilapidations and disrepair on various leasehold buildings. Onerous provisions as at 1 January 2019 were 
offset against the right-of-use asset arising on the adoption of IFRS 16.

Restructuring provisions outstanding as at 31 December 2020 relate to termination and other employee related costs. The movement 
during the year reflects the actions taken under the Group’s restructuring initiatives. It is expected that the remaining obligations will be 
discharged during 2021. 

Legal and other provisions include provisions for legal claims brought against subsidiaries of the Group together with provisions against 
obligations for certain long-term employee benefits and non-property related onerous contracts. At present the timing and amount of any 
payments are uncertain and provisions are subject to regular review. It is expected that the obligations will be discharged over the next 
25 years. 

European Commission Yen Libor
In February 2015 the European Commission imposed a fine of €15m on NEX International Limited (formerly ICAP plc), ICAP Management 
Services Limited and ICAP New Zealand Limited for alleged competition violations in relation to the involvement of certain of ICAP’s 
brokers in the attempted manipulation of Yen LIBOR by bank traders between October 2006 and January 2011. Whilst this matter relates 
to alleged conduct violations prior to completion of the Group’s acquisition of the ICAP global broking business, it is noted that the fine 
imposed by the European Commission has been appealed, seeking a full annulment of the Commission’s decision. In the event that the 
Commission imposes a fine in excess of €15m such excess will be borne by NEX Group plc (‘NEX’). In November 2017, the European General 
Court granted a partial annulment of the Commission’s findings. The Commission appealed this decision in February 2018 and the Group 
served its reply during April 2018. A decision from the Courts of Justice of the European Union was received on 10 July 2019 which 
determined that the decision of the European Commission in relation to the competition violations stood but the decision of the European 
Commission imposing the fine was annulled. The European Commission is likely to adopt new articles in relation to a fine. Based on the 
latest review, the Group updated the provision to €6.5m (£6m) in December 2020. 

IFUS
On 11 May 2020, Tullett Prebon (Europe) Ltd (‘TPE’) received notice of the instigation of disciplinary proceedings by ICE Futures U.S. (‘IFUS’) 
relating to activities undertaken between March 2018 and September 2019. Following engagement and consultation with IFUS, TPE 
agreed a settlement with IFUS dated 13 August 2020 under which TPE agreed and paid a fine of less than USD 1m (less than £1m) in respect 
of failures of block trades, general record requirements, order ticket requirements, minimum quantity requirements, disclosure of customer 
identity and failure to supervise. As part of that agreement TPE agreed to enhance its compliance manual, take reasonable proactive and 
appropriate measures to be in compliance with Exchange Rules, conduct training covering Exchange Rules and to require all TPE brokers to 
acknowledge receipt and understanding of such training and to cooperate with periodic audits of TPE compliance in connection with 
Exchange Rules.

Annual Report and Accounts 2020
161

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

27. Other long term payables

Accruals and deferred income
Deferred consideration (Note 32(d))

2020
£m
4
19
23

2019
£m
3
18
21

28. Financial instruments
(a) Financial and liquidity risk
The Group does not take trading risk and does not hold proprietary trading positions. Consequently, the Group is exposed to trading book 
market risk only in relation to incidental positions in financial instruments arising as a result of the Group’s failure to match clients’ orders 
precisely. The Group has limited exposure to non-trading book market risk, specifically to interest rate risk and currency risk. Thus the 
overall approach to the planning and management of the Group’s capital and liquidity is to ensure the Group’s solvency, i.e. its continued 
ability to conduct business, deliver returns to shareholders, and support growth and strategic initiatives. This risk profile meets the 
necessary conditions for an investment firm consolidation waiver and the Group benefits from a waiver under the CRD IV provisions, the 
details of which are set out in the Regulatory Capital section of the Strategic Report on page 42. Following the re-domiciliation to Jersey 
and the subsequent reorganisation of the legal structure of the Group, see contents page of the inside cover of the Annual Report, the 
Group will no longer be subject to the consolidated capital adequacy requirements under CRD IV and as a result the ‘Financial Holding 
Company test’ and CRD IV waiver requirements of the FCA will no longer be applicable. The FCA will become the lead regulator of the 
Group’s sub-consolidated EMEA activities, headed by the UK, for which the consolidated capital adequacy requirements will apply 
under CRD IV. 

The Group seeks to ensure that it has access to an appropriate level of cash, other forms of marketable securities and liquidity facilities to 
enable it to finance its ongoing operations on cost effective terms. Cash and cash equivalent balances are held with the primary objective 
of capital security and availability, with a secondary objective of generating returns. Funding requirements are monitored by the Group’s 
Finance and Treasury functions.

As a normal part of its operations, the Group faces liquidity risk through the risk of being required to fund transactions that fail to settle on 
the due date. From a risk perspective, the most problematic scenario concerns ‘fail to deliver’ transactions, where the business has received 
a security from the selling counterparty (and has paid cash in settlement of the same) but is unable to effect onward delivery of the security 
to the buying counterparty. Such settlement ‘fails’ give rise to a funding requirement, reflecting the value of the security which the Group 
has ‘failed to deliver’ until such time as the delivery leg is finally settled, or the security sold, and the business has received the associated 
cash.

The Group has addressed this funding risk by arranging overdraft facilities to cover ‘failed to deliver’ trades, either with the relevant 
settlement agent/depository or with a clearing bank. Under such arrangements, the facility provider will fund the value of any ‘failed 
to deliver’ trades until delivery of the security is effected. Certain facility providers require collateral (such as a cash deposit or parent 
company guarantee) to protect them from any adverse mark-to-market movement and some also charge a funding fee for providing 
the facility.

The Group is also exposed to potential margin calls. Margin calls can be made by central counterparties under the Matched Principal 
broking model when not all legs of a matched principal trade are settled at the central counterparty or when there is a residual balance or 
confirmation error. Margin calls can be made by the Group’s clearers or correspondent clearers under the Executing Broker broking model 
when there is a trade error or a counterparty is slow to confirm their trade. These margin calls occur mainly in the US and UK.

In the event of a short-term liquidity requirement, the firm has recourse to existing global cash resources, after which it could draw down 
on its £270m committed revolving credit facility and Yen 10bn (£71m) committed facility with The Tokyo Tanshi Co., Ltd as additional 
contingency funding, less any amounts earmarked to fund proposed acquisitions.

(b) Capital management
The Group’s policy is to maintain a capital base and funding structure that maintains creditor, regulator and market confidence and 
provides flexibility for business development while also optimising returns to shareholders. The capital structure of the Group consists of 
debt, as set out in Note 24, cash and cash equivalents, other current financial assets and equity attributable to equity holders of the parent, 
comprising issued capital, reserves and retained earnings as disclosed in Notes 29 and 30. Dividends paid during the year are disclosed in 
Note 12 and the dividend policy is discussed in the Strategic Report.

The Group has an investment firm consolidation waiver under which it is required to monitor its compliance with a Financial Holding 
Company test which takes into account the Company’s shareholders’ funds and the aggregated credit risk, market risk and fixed overhead 
requirements of the Company’s subsidiaries (see Note 28(a) regarding the impact of the re-domiciliation of the Group to Jersey and 
subsequent reorganisation of the legal structure of the Group). A number of the Company’s subsidiaries are individually regulated and are 
required to maintain capital that is appropriate to the risks entailed in their businesses according to definitions that vary according to 
each jurisdiction. In addition to subsidiaries fulfilling their regulatory obligations, the Group undertakes periodic reviews of the current 
and projected regulatory requirements of each of these entities.

Annual Report and Accounts 2020
162

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

FVTOCI
debt
instruments 
£m

FVTOCI
equity
instruments 
£m

FVTOCI 
derivatives 
designated as 
hedging 
instruments 
£m

Amortised 
cost
£m

Total
carrying
amount 
£m

–
2

–
2

–
87

–
–
–
–
–
–
–
–
–
87
89

16
–

–
16

–
–

–
–
–
–
–
–
–
–
–
–
16

–
–

–
–

3
–

–
–
–
–
–
–
–
–
–
3
3

FVTOCI
debt
instruments 
£m

FVTOCI
equity
instruments 
£m

FVTOCI 
derivatives 
designated as 
hedging 
instruments
£m

–
2

–
2

–
87

–
–
–
–
–
–
–
–
–
–
87
89

18
–

–
18

–
–

–
–
–
–
–
–
–
–
–
–
–
18

–
–

–
–

–
–

–
–
–
–
–
–
–
–
–
–
–
–

–
–

5
5

–
–

40
15
11
5
301
68,487
1,115
1
656
70,631
70,636

Amortised 
cost
(Restated)
£m

–
–

7
7

–
–

51
17
10
3
10
301
48,295
652
1
676
50,016
50,023

16
2

5
23

3
87

40
15
11
5
301
68,487
1,115
1
656
70,721
70,744

Total
carrying
amount
(Restated) 
£m

18
2

7
27

–
87

51
17
10
3
10
301
48,295
652
1
676
50,103
50,130

(c) Categorisation of financial assets and liabilities

Financial assets
2020
Non-current financial assets measured at fair value
Equity securities
Corporate debt securities
Non-current financial assets not measure at fair value
Finance lease receivables

Current financial assets measured at fair value
Derivative instruments
Government debt securities
Current financial assets not measured at fair value¹
Term deposits
Other debtors
Accrued income
Owed by associates and joint ventures
Trade receivables
Settlement balances receivable
Deposits paid for securities borrowed
Finance lease receivables
Cash and cash equivalents

Total financial assets

Financial assets
2019
Non-current financial assets measured at fair value
Equity securities
Corporate debt securities
Non-current financial assets not measure at fair value
Finance lease receivables

Current financial assets measured at fair value
Derivative instruments
Government debt securities
Current financial assets not measured at fair value¹
Term deposits
Other debtors2
Accrued income2
Owed by associates and joint ventures2
Restricted funds
Trade receivables
Settlement balances receivable
Deposits paid for securities borrowed
Finance lease receivables
Cash and cash equivalents

Total financial assets

Financial assets are initially measured at fair value.

1 
2  Restated to include as financial assets.

Annual Report and Accounts 2020
163

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

28. Financial instruments continued
(c) Categorisation of financial assets and liabilities continued

Financial liabilities
2020
Financial liabilities measured at fair value
Deferred consideration

Financial liabilities not measured at fair value¹
Overdraft
Loans with related parties
Sterling Notes January 2024
Sterling Notes May 2026
Other creditors
Accruals2
Owed to associate and joint ventures
Trade payables
Settlement balances payable
Deposits received for securities loaned
Lease liabilities

Total financial liabilities

Financial liabilities
2019
Financial liabilities measured at fair value
Deferred consideration

Financial liabilities not measured at fair value¹
Sterling Notes January 2024
Sterling Notes May 2026
Other creditors2
Accruals2
Owed to associate and joint ventures2
Trade payables
Settlement balances payable
Deposits received for securities loaned
Lease liabilities

Total financial liabilities

Mandatorily at FVTPL

Other financial liabilities

Non-current
£m

Current
£m

Non-current 
£m

Current
£m

19
19

–
–
–
–
–
–
–
–
–
–
–
–
19

12
12

–
–
–
–
–
–
–
–
–
–
–
–
12

–
–

–
–
430
249
–
–
–
–
–
–
186
865
865

–
–

7
28
10
1
13
75
3
23
68,476
1,106
26
69,768
69,768

Mandatorily at FVTPL

Other financial liabilities

Non-current
£m

Current
£m

Non-current 
£m

18
18

–
–
–
–
–
–
–
–
–
–
18

23
23

–
–
–
–
–
–
–
–
–
–
23

–
–

430
248
–
–
–
–
–
–
117
795
795

Current
(Restated)
£m

–
–

10
1
15
72
3
25
48,275
652
23
49,076
49,076

Total
carrying
amount 
£m

31
31

7
28
440
250
13
75
3
23
68,476
1,106
212
70,633
70,664

Total
carrying
amount 
(Restated)
£m

41
41

440
249
15
72
3
25
48,275
652
140
49,871
49,912

Financial liabilities are measured at fair value on initial recognition.

1 
2  Restated to include as financial liabilities. The remaining accruals of £195m (2019: £217m) are not recorded as financial liabilities.

(d) Credit risk
The Group is exposed to credit risk in the event of default by counterparties in respect of its Name Passing, Matched Principal, Executing 
Broker and corporate treasury operations. The Group does not bear any significant concentration risk to either counterparts or markets.
The credit risk in respect of the Name Passing business and the information sales and risk management services is limited to the collection 
of outstanding commission and transaction fees and this is managed proactively by the Group’s accounts receivable functions. As at the 
year end, 67% of the Group’s counterparty exposure is to investment grade counterparts (rated BBB-/Baa3 or above) (Note 22).

The Matched Principal business involves the Group acting as a counterparty on trades which are undertaken on a delivery versus payment 
basis. The Group manages its credit risk in these transactions through appropriate policies and procedures in order to mitigate this risk 
including stringent on-boarding requirements, setting appropriate credit limits for all counterparts which are closely monitored by the 
regional credit risk teams to restrict any potential loss through counterparty default. Settlement of these transactions takes place 
according to the relevant market rules and conventions and the credit risk is considered to be minimal. As at year end, 91% of the Group’s 
counterparty exposure is to investment grade counterparts. Deposits paid for securities borrowed arise on collateralised stock lending 
transactions. Such trades are complete only when both the collateral and stock for each side of the transaction are returned. As at the year 
end, 60% of the Group’s counterparty exposure is to investment grade counterparts (Note 22).

Annual Report and Accounts 2020
164

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

The credit risk on cash, cash equivalents, and financial assets at amortised cost, FVTOCI or FVTPL, are subject to frequent monitoring. 
All financial institutions that are transacted with are approved and internal limits are assigned to each one based on a combination of 
factors including external credit ratings. As at the year end, 96% of cash and cash equivalents is deposited with investment grade rated 
financial institutions.

The ‘maximum exposure to credit risk’ is the maximum exposure before taking account of any securities or collateral held, or other credit 
enhancements, unless such enhancements meet accounting offsetting requirements. For financial assets recognised on the balance sheet, 
excluding equity instruments as they are not subject to credit risk, the maximum exposure to credit risk equals their carrying amount.

(e) Maturity profile of financial and lease liabilities
The table below reflects the contractual maturities, including future interest obligations, of the Group’s financial and lease liabilities 
as at 31 December:

Due
between
3 months
and
12 months
£m

Due 
between 
1 year and 
5 years 
£m

–
–
–
–
–
–
27
–
–
11
13
3
54

–
–
–
–
–
–
114
–
–
488
52
19
673

Due
between
3 months
and
12 months
£m

Due 
between 
1 year and 
5 years 
£m

–
–
3
–
–
–
24
11
7
18
63

–
–
–
–
–
–
81
533
59
13
686

Due within 
3 months
£m

68,476
1,106
23
13
75
3
11
7
28
11
–
9
69,762

Due within 
3 months
(Restated)
£m

48,275
652
22
15
72
3
9
11
–
6
49,065

Due 
after 
5 years 
£m

–
–
–
–
–
–
137
–
–
–
257
–
394

Due 
after 
5 years 
£m

–
–
–
–
–
–
91
–
270
4
365

Total 
£m

68,476
1,106
23
13
75
3
289
7
28
510
322
31
70,883

Total 
(Restated)
£m

48,275
652
25
15
72
3
205
555
336
41
50,179

2020
Settlement balances
Deposits received for securities loaned
Trade payables
Other creditors
Accruals
Owed to associate and joint ventures
Lease liabilities
Overdraft
Related party loan
Sterling Notes January 2024
Sterling Notes May 2026
Deferred consideration

2019
Settlement balances
Deposits received for securities loaned
Trade payables
Other creditors1
Accruals1
Owed to associate and joint ventures1
Lease liabilities
Sterling Notes January 2024
Sterling Notes May 2026
Deferred consideration

1  Restated to include as financial liabilities.

Annual Report and Accounts 2020
165

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

28. Financial instruments continued
(f) Foreign currency sensitivity analysis
The table below illustrates the sensitivity of the profit for the year with regard to currency movements on financial assets and liabilities 
denominated in foreign currencies as at the year end. The sensitivity of the Group’s equity with regard to its net foreign currency 
investments at the year end is also shown below. 

Based on a 10% weakening in the following exchange rates against Sterling, the effects would be as follows:

Currency:
 > USD
 > EUR
 > SGD
 > HKD
 > JPY
 > AUD

Change in foreign currency financial 
assets and liabilities – profit or loss

Change in translation of foreign 
operations – equity

2020
£m

(5)
(4)
–
–
–
–

2019
£m

(4)
(4)
–
–
–
–

2020
£m

(35)
(6)
(9)
(4)
(4)
(2)

2019
Restated
£m

(80)
(4)
(8)
(5)
(3)
(2)

(f) Foreign currency sensitivity analysis continued
Unless specifically hedged, the Group would experience equal and opposite foreign exchange movements should the currencies strengthen 
against Sterling.

As at 31 December 2020 the Group held US currency options, with a fair value of £3m and an average strike price of US$1.40 that are 
designated as a net investment hedge against US$600m of the Group’s US denominated assets. The options expire in April 2021.

(g) Interest rate sensitivity analysis
Interest on floating rate financial instruments is reset at intervals of less than one year. The Group’s exposure to interest rates arises on cash 
and cash equivalents and money market instruments. The Sterling Notes are fixed rate financial instruments.

A 100 basis point change in interest rates, applied to average floating rate financial instrument assets and liabilities during the year, 
would result in the following impact on profit or loss:

Income/(expense) arising on:
 > floating rate assets
 > floating rate liabilities
Net income/(expense) for the year

2020

+100pts
£m

7
–
7

-100pts
£m

(7)
–
(7)

2019

+100pts
£m

7
(1)
6

-100pts
£m

(7)
1
(6)

(h) Fair value measurements recognised in the statement of financial position
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped 
into Levels 1 to 3 based on the degree to which the fair value is observable:

 > Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
 >  Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for 

the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and 

 >  Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not 

based on observable market data (unobservable inputs).

2020
Financial assets measured at fair value
Equity instruments
Corporate debt securities
Government debt securities
Derivative instruments
Financial liabilities measured at fair value
Deferred consideration

Annual Report and Accounts 2020
166

Level 1 
£m

Level 2
£m

Level 3 
£m

Total 
£m

–
–
87
–

–
87

7
–
–
3

(5)
5

9
2
–
–

(26)
(15)

16
2
87
3

(31)
77

2019
Financial assets measured at fair value
Equity instruments
Corporate debt securities
Government debt securities
Financial liabilities measured at fair value
Deferred consideration

Level 1 
£m

Level 2
£m

Level 3 
£m

Total 
£m

3
–
87

–
90

8
–
–

(16)
(8)

7
2
–

(25)
(16)

18
2
87

(41)
66

In deriving the fair value of equity and derivative instruments valuation models were used which incorporated observable market data. 
There were no significant inputs used in these models that were unobservable. There is no material sensitivity to unobservable inputs used 
in these models. 

The fair value of deferred consideration is based on valuation models incorporating unobservable inputs reflecting the estimated 
performance conditions specific to each acquisition. As inputs are acquisition specific outcomes can vary from that used to estimate fair 
values at a reporting date. Where deferred consideration is non-contingent, or where conditions have been met but unsettled at the year 
end, such amounts are included as level 2. 

There were no transfers between Level 1 and 2 during the year. In 2020, £2m of equity instruments were transferred from Level 2 to Level 3 
as the inputs relating to that balance were unobservable as at 31 December 2020.

Reconciliation of Level 3 fair value measurements of financial assets:

Balance as at 1 January
Net change in fair value – included in ‘administrative expenses’
Acquisitions during the year
Amounts settled during the year
Transfer of assets from level 2
Transfer of liabilities to level 2
Effect of movements in exchange rates
Balance as at 31 December

Equity 
instruments
(at FVTOCI)
£m
7
–
–
–
2
–
–
9

Debt securities
(at FVTOCI)
£m
2
–
–
–
–
–
–
2

Deferred
consideration
(at FVTPL)
£m
(25)
(2)
(8)
7
–
–
2
(26)

2020
Total 
£m
(16)
(2)
(8)
7
2
–
2
(15)

2019
Total
£m
(32)
(6)
(6)
12
–
16
–
(16)

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

29. Share capital

Allotted, issued and fully paid
Ordinary shares of 25p
As at 1 January
Issue of ordinary shares
As at 31 December

2020 
No.

2019 
No.

565,336,380 563,336,380
–
563,336,380 563,336,380

–

Annual Report and Accounts 2020
167

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

30. Reconciliation of shareholders’ funds
(a) Share capital, Share premium account, Merger reserve

2020
As at 1 January 2020
Issue of ordinary shares
As at 31 December 2020

2019
As at 1 January 2019
Issue of ordinary shares
As at 31 December 2019

Share 
capital 
£m

141
–
141

141
–
141

Share 
premium 
account 
£m

17
–
17

17
–
17

Merger 
reserve
£m 

1,384
–
1,384

1,384
–
1,384

Total 
£m

1,542
–
1,542

1,542
–
1,542

Merger reserve
The merger reserve relates to prior share-based acquisitions and represented the difference between the value of those acquisitions and 
the amount required to be recorded in share capital.

(b) Other reserves

2020
As at 1 January 2020
Fair value movement on derivative financial instruments
Exchange differences on translation of foreign operations
Taxation on components of other comprehensive income 
Total comprehensive income
Gain on disposal of equity investments at FVTOCI
Share settlement of share-based payment awards
Own shares acquired for employee trusts
As at 31 December 2020

2019
As at 1 January 2019
Equity investments at FVTOCI – net change in fair value
Exchange differences on translation of foreign operations
Taxation on components of other comprehensive income 
Total comprehensive income
Gain on disposal of equity investments at FVTOCI
Share settlement of share-based payment awards
Own shares acquired for employee trusts
As at 31 December 2019

Reverse
acquisition 
reserve
£m 

Revaluation
reserve 
£m 

Hedging 
and
translation
£m

(1,182)
–
–
–
–
–
–
–
(1,182)

(1,182)
–
–
–
–
–
–
–
(1,182)

5
–
–
–
–
(1)
–
–
4

4
1
–
–
1
–
–
–
5

(12)
2
(30)
(1)
(29)
–
–
–
(41)

31
–
(43)
–
(43)
–
–
–
(12)

Own 
shares
£m

(16)
–
–
–
–
–
3
(14)
(27)

(11)
–
–
–
–
–
2
(7)
(16)

Other
reserves
£m 

(1,205)
2
(30)
(1)
(29)
(1)
3
(14)
(1,246)

(1,158)
1
(43)
–
(42)
–
2
(7)
(1,205)

Reverse acquisition reserve
The acquisition of Collins Stewart Tullett plc by Tullett Prebon plc in 2006 was accounted for as a reverse acquisition. Under IFRS the 
consolidated accounts of Tullett Prebon plc are prepared as if they were a continuation of the consolidated accounts of Collins Stewart 
Tullett plc. The reverse acquisition reserve represents the difference between the initial equity share capital of Tullett Prebon plc and the 
share capital and share premium of Collins Stewart Tullett plc at the time of the acquisition. This resulted in the consolidated net assets 
before and after the acquisition remaining unchanged. 

Revaluation reserve
The revaluation reserve represents the remeasurement of assets in accordance with IFRS that have been recorded in other  
comprehensive income.

Hedging and translation
The hedging and translation reserve records revaluation gains and losses arising on net investment hedges and the effect of changes in 
exchange rates on translation of foreign operations recorded in other comprehensive income. As at 31 December 2020, £8m relates to 
amounts arising on previous net investment hedges (2019: £10m). 

Annual Report and Accounts 2020
168

Own shares
As at 31 December 2020, the TP ICAP plc EBT (formerly the Tullett Prebon plc Employee Benefit Trust 2007) held 8,630,751 ordinary shares 
(2019: 4,535,504 ordinary shares) with a fair value of £21m (2019: £19m). During the year the Trust delivered 750,572 shares in satisfaction 
of vesting share-based awards and purchased 4,845,819 ordinary shares in the open market at a cost of £14m. In 2019 the Trust delivered 
698,801 shares in satisfaction of vesting share-based awards and purchased 625,301 ordinary shares in the open market at a cost of £7m. 

Total 
£m

Non-controlling
interests 
£m

Equity attributable to equity holders of the parent

Total from
Note 30(a)
£m

Total from
Note 30(b) 
£m

1,542
–

(1,205)
–

Retained
earnings
£m

1,375
96

–

–

–

–
–
–
–

–

–
–
–

–
1,542

1,542
–

–

–

–

–
–
–
–

–

–
–
–

2

(30)

–

(1)
(29)
–
–

(1)

3
(14)
–

–
(1,246)

(1,158)
–

1

(43)

–

–
(42)
–
–

–

2
(7)
–

–

–

2

–
98
–
(94)

1

(3)
–
–

6
1,383

1,430
67

–

–

(52)

19
34
–
(94)

–

(3)
–
3

1,712
96

2

(30)

2

(1)
69
–
(94)

–

–
(14)
–

6
1,679

1,814
67

1

(43)

(52)

19
(8)
–
(94)

–

(1)
(7)
3

–
1,542

–
(1,205)

5
1,375

5
1,712

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Total 
equity 
£m

1,730
97

2

(30)

2

(1)
70
–
(95)

–

–
(14)
1

6
1,698

1,830
68

1

(44)

(52)

19
(8)
–
(95)

–

(1)
(7)
6

5
1,730

18
1

–

–

–

–
1
–
(1)

–

–
–
1

–
19

16
1

–

(1)

–

–
–
–
(1)

–

–
–
3

–
18

(c) Total equity

2020
As at 1 January 2020
Profit for the year
Fair value movement on derivative 
financial instruments
Exchange differences on translation  
of foreign operations
Remeasurement of defined benefit 
pension schemes
Taxation on components of other 
comprehensive income
Total comprehensive income
Issue of ordinary shares
Dividends paid
Gain on disposal of equity investments 
at FVTOCI
Share settlement of share-based 
payment awards
Own shares acquired for employee trusts
Non-controlling interests arising on acquisitions
Credit arising on share-based payment 
awards (Note 31)
As at 31 December 2020

2019
As at 1 January 2019
Profit for the year
Equity instruments at FVTOCI – net change in 
fair value
Exchange differences on translation  
of foreign operations
Remeasurement of defined benefit 
pension schemes
Taxation on components of other 
comprehensive income
Total comprehensive income
Issue of ordinary shares
Dividends paid
Gain on disposal of equity investments 
at FVTOCI
Share settlement of share-based 
payment awards
Own shares acquired for employee trusts
Non-controlling interests arising on acquisitions
Credit arising on share-based payment 
awards (Note 31)
As at 31 December 2019

Annual Report and Accounts 2020
169

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

31. Share-based awards 
Senior Manager Deferred Bonus Plan
Annual awards are made under the Group’s Senior Manager Deferred Bonus Plan.

Under this Plan, employees identified as senior managers have up to 35% of their annual discretionary bonus awarded in deferred shares. 
These awards will be settled with TP ICAP Group plc shares and are subject to the completion of service conditions and the fulfilment of 
other conduct requirements. The number of shares in respect of a bonus year is determined after the close period for that year at the then 
market price, and vest over three years from the grant. The fair value of the shares equates to the monetary value of the awards at grant 
date and includes the value of expected dividends that will accrue to the beneficiaries.

Awards will be settled by the TP ICAP plc Employee Benefit Trust from shares purchased by it in the open market.

Outstanding at the beginning of the year
Granted during the year
Forfeited during the year
Settled during the year
Outstanding at the end of the year

2020 
No.
4,095,520
1,624,098
(549,341)
(750,572)
4,419,705

2019
No.
2,888,313
1,965,358
(59,350)
(698,801)
4,095,520

At the year end closing share price of 238.2p the estimated total number of deferred shares for the 2020 bonus year was 1,540,739.

Executive Director Deferred Bonus Plan
Annual awards are made under the Group’s Executive Director Deferred Bonus Plan.

The Group’s Executive Directors have 50% of their annual discretionary bonus awarded in deferred shares. These awards are subject to the 
completion of service conditions and the fulfilment of other conduct requirements and will be settled with TP ICAP Group plc shares. The 
number of shares in respect of a bonus year is determined after the close period for that year at the market price, and vest three years from 
the date of the grant. The fair value of the shares equates to the monetary value of the awards at grant date and includes the value of 
expected dividends that will accrue to the beneficiaries.

Outstanding at the beginning of the year
Granted during the year
Outstanding at the end of the year

2020 
No.
220,510
446,262
666,772

2019
No.
82,000
138,510
220,510

Awards will be settled by the TP ICAP plc Employee Benefit Trust from shares purchased by it in the open market.

At the year end closing share price of 238.2p the estimated total number of deferred shares for the 2020 bonus year was 534,425.

Transformation Long Term Incentive Plan (‘T-LTIP’)
The Transformation Long Term Incentive Plan commenced in 2017 as a one-off long-term plan aligned to the three-year integration period 
for Tullett Prebon and ICAP (January 2017 – December 2019). Awards were allocated between the Executive Directors and members of the 
Group’s Global Executive Committee. Awards were forfeited if a beneficiary left the Group, unless explicitly agreed otherwise by the 
Group’s Remuneration Committee. 

During 2019, as a condition of granting Executive Directors awards under the Group’s new Long Term Incentive Plan (see below) their T-LTIP 
awards were cancelled. The cancellation was treated as a modification resulting in an acceleration of the associated share-based expense 
at that time. 

Performance under the plan, based on absolute total shareholder return and earnings per share, was completed in 2020 following the end 
of the performance period. As performance was below the plan thresholds no shares were awarded. Any awards would have been subject 
to a further holding period with a release of one third in April 2021, one third in April 2022 and one third in April 2023. 

No share-based charge arose in 2020. In 2019 a net share-based credit of £1m arose, reflecting the accelerated cost from modifying of the 
Executive Directors awards offset by a credit relating to the forfeiture of awards.

Annual Report and Accounts 2020
170

Long Term Incentive Plan (‘LTIP’)
As part of the Directors’ Remuneration Policy, approved by shareholders at the May 2019 AGM, a new Long Term Incentive Plan (‘LTIP’) 
was introduced for Executive Directors and other senior employees. Awards made to the Executive Directors are up to a maximum of 
2.5x base salary. Awards made to senior employees, based on the recommendation of the Chief Executive Officer and subject to approval 
by the Remuneration Committee, are up to a maximum of 2x base salary. All awards are subject to agreed performance conditions 
applicable to each grant. 

Outstanding at the beginning of the year
Granted during the year
Outstanding at the end of the year

2020 
No.
1,264,712
2,766,617
4,031,329

2019
No.
–
1,264,712
1,264,712

In 2019, shares to a maximum of 1,264,712 were awarded to the Executive Directors. These awards are subject to performance conditions 
measured over the three-year period 2019 to 2021 with 50% of the awards subject to EPS compound annual growth targets and 50% 
subject to relative total shareholder return targets. No awards were made to senior employees in 2019.

In 2020, shares to a maximum of 2,766,617 were awarded to the Executive Directors and senior employees. These awards are subject to 
performance conditions measured over the three-year period 2020 to 2022 with 30% of the awards subject to EPS compound annual 
growth targets, 50% subject to relative total shareholder return targets and 20% subject to new business growth targets. Details of the 
financial targets are set out in the Report of the Remuneration Committee on page 99.

At the end of each performance period, the number of shares vesting will be determined, based on the application of the relevant 
performance conditions and will be subject to a two-year holding period. During the holding period, the shares cannot be sold (other than 
to cover the cost of any applicable taxes) and will be eligible for dividend equivalence.

Under the Scheme Rules awards may be settled through the issue of new shares, release of treasury shares or using shares purchased 
in the market.

Special Equity Award Plan
During 2019, a Special Equity Award Plan (‘SEAP’) was introduced for eligible employees. The Executive Directors are not eligible for 
awards under this plan. Awards are made to eligible employees based on the recommendation of the Chief Executive Officer and subject 
to approval by the Remuneration Committee. Awards are subject to the completion of service conditions and the fulfilment of other 
conduct requirements and vest three years from the date of grant. The fair value of the shares equates to the monetary value of the awards 
at grant date and includes the value of expected dividends that will accrue to the beneficiaries.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Outstanding at the beginning of the year
Granted during the year
Forfeited during the year
Outstanding at the end of the year

2020 
No.
731,470
86,716
(152,515)
665,671

2019
No.
–
731,470
–
731.470

Awards will be settled by the TP ICAP plc Employee Benefit Trust from shares purchased by it in the open market.

At the year end closing share price of 238.2p the estimated total number of SEAP awards for the 2020 bonus year was 1,686,951.

Charge arising from the Senior Manager Deferred Bonus Plan
Charge arising from the Executive Director Deferred Bonus Plan
Charge arising from the Transformation Long Term Incentive Plan
Charge arising from the Long Term Incentive Plan
Charge arising from the Special Equity Award Plan

2020
£m
3
1
–
1
1
6

2019
£m
5
–
(1)
–
1
5

Annual Report and Accounts 2020
171

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

32. Acquisitions
(a) Louis Capital
In July 2020 the Group acquired 100% of LCM Europe Limited, LCM D Ltd and Louis Capital Markets LLC (collectively Louis Capital), 
a private brokerage group specialising in equities and fixed income, primarily based in Europe. 

Under the agreement, initial cash consideration was US$20m (£17m). Consideration was adjusted, based on the level of regulatory capital, 
working capital and net cash at completion, resulting in an inflow of US$1m (£1m). Deferred non-contingent consideration with an initial 
fair value of US$6m (£5m) is payable over two years and deferred contingent consideration, with an initial fair value of US$11m (£8m), 
is payable dependent upon the performance of the business over five years. The actual outcome may defer from this estimate. The gross 
payment of deferred contingent consideration is capped at US$17m. 

The initial fair value of the net assets acquired was US$5m (£4m). The excess purchase price of US$31m (£25m) was allocated to goodwill. 
Acquisition costs, included in administrative expenses, amounted to £1m in the period to 31 December 2020 and £1m in 2019. 

Had Louis Capital been acquired on 1 January 2020 the Group’s operating profit would have been £2m higher and its earnings £1m higher.

(b) ICAP (Malaysia) Sdn Bhd (previously known as Amanah Butler Malaysia Sdn Bhd)
During the year, the Group increased its ownership in its associate ICAP (Malaysia) Sdn Bhd from 21.7% to 78.3% by way of the acquisition 
of shares in July 2020. The purchase was for £1m in cash with no deferred or contingent consideration. 

In November 2020, the Group reduced its ownership by 20% from 78.3% to 58.3% for cash and deferred consideration amounting to less 
than £1m, receivable over four years.

(c) Finalisation of the acquisition of ClearCompress Limited
During 2020, the Group finalised the accounting for the acquisition of ClearCompress, a provider of algorithm-based compression services 
for currency swaps. There were no changes to the provisional fair value of liabilities acquired of £1m, nor in the £6m goodwill initially 
recognised in 2019.

(d) Analysis of deferred consideration in respect of acquisitions
Certain acquisitions made by the Group are satisfied in part by deferred consideration, comprising contingent and non-contingent 
amounts, depending on the terms of each acquisition. The amount of contingent consideration payable is dependent upon the 
performance of each acquisition relative to the performance conditions applicable to that acquisition. The Group has re-estimated the 
amounts due where necessary, with any corresponding adjustments being made to profit or loss. The actual outcome may differ from 
these estimates.

At 1 January
Acquisitions during the year
Adjustments to deferred consideration charged to the Income Statement
Cash-settled
Effect of movements in exchange rates
At 31 December

Amounts falling due within one year
Amounts falling due after one year
At 31 December

2020 
£m
41
13
2
(22)
(3)
31

12
19
31

2019 
£m
41
6
6
(12)
–
41

23
18
41

Annual Report and Accounts 2020
172

33. Reconciliation of operating result to net cash flow from operating activities

Operating profit 
Adjustments for:
 > Share-based payment charge
 > Pension scheme’s administration costs
 > Pension scheme past service and settlement costs
 > Depreciation of property, plant and equipment
 > Depreciation of right-of-use assets
 > Amortisation of intangible assets
 > Amortisation of intangible assets arising on consolidation
 > Impairment of intangible assets arising on consolidation
 > Impairment of associates
 > Loss on disposal of property, plant and equipment
 > Impairment of right-of-use assets
 > Impairment of finance lease receivables
 > Remeasurement of deferred consideration
Net operating cash flow before movement in working capital
Decrease/(increase) in trade and other receivables
(Increase)/decrease in net settlement and trading balances
(Decrease)/increase in trade and other payables
Decrease in provisions
Increase/(decrease) in non-current liabilities
Retirement benefit scheme contributions
Net cash generated from operations
Income taxes paid
Fees paid on bank and other loan facilities
Interest paid
Interest paid – finance leases
Net cash flow from operating activities

2020 
£m
178

6
1
1
13
23
20
39
21
1
–
1
1
2
307
6
(2)
(34)
(7)
1
(1)
270
(73)
(2)
(37)
(14)
144

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019
£m
142

5
–
4
13
21
27
42
24
–
1
–
–
6
285
(24)
8
4
(5)
(2)
(1)
265
(64)
(2)
(39)
(12)
148

Annual Report and Accounts 2020
173

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

34. Analysis of net funds

2020
Cash and cash equivalents
Overdrafts

Financial investments 
Bank loan due within one year
Loans from related parties
Sterling Notes January 2024
Sterling Notes May 2026
Lease liabilities
Total financing liabilities

Net debt

2019
Cash and cash equivalents
Overdrafts

Financial investments
Bank loan due within one year
Loans from related parties
Sterling Notes June 2019
Sterling Notes January 2024
Sterling Notes May 2026
Lease liabilities
Total financing liabilities

Net funds/(debt)

At 
1 January 
£m

Cash flow
£m

Non-cash
items 
£m

Aquired with 
acquisitions
£m

Exchange 
rate
movements
£m

At 
31 December
£m

686
(10)
676
148
–
–
(440)
(249)
(140)
(829)

(5)

(17)
3
(14)
(18)
11
(28)
231
131
382
47

15

–
–
–
–
(1)
–
(23)
(14)
(108)
(146)

(146)

–
–
–
–
–
–
–
–
(5)
(5)

(5)

(13)
–
(13)
(3)
–
–
–
–
3
3

(13)

656
(7)
649
127
–
(28)
(440)
(250)
(212)
(930)

(154)

At 
1 January 
£m

Cash flow
£m

Non-cash
items 
£m

Adoption of 
IFRS 16
£m

Exchange 
rate
movements
£m

At 
31 December
£m

680
(13)
667
133
(52)
–
(80)
(510)
–
–
(642)

158

19
3
22
20
531
3
823
974
(241)5
332
27

69

–
–
–
–
(1)
–
(2)
(27)
(8)
(32)
(70)

(70)

–
–
–
–
–
–
–
–
–
(145)
(145)

(145)

(13)
–
(13)
(5)
–
(3)
–
–
–
4
1

(17)

686
(10)
676
148
–
–
–
(440)
(249)
(140)
(829)

(5)

1  Relates to interest paid reported as a cash outflow from operating activities.
2  Relates to interest paid of £14m (2019: £12m) reported as a cash outflow from operating activities and principal paid of £24m (2019:£21m) reported as a cash outflow from 

financing activities.

3  Relates to principal repayment of £80m reported as a cash outflow from financing activities plus £2m of interest paid reported as a cash outflow from operating activities.
4  Relates to principal repayment of £69m reported as a cash outflow from financing activities plus £28m of interest paid reported as a cash outflow from operating activities.
5  Relates to principal received of £250m less £2m of debt issue costs reported as a cash outflow from financing activities and £7m of interest paid reported as cash outflow 

from operating activities.

Cash and cash equivalents comprise cash at bank and other short-term highly liquid investments with an original maturity of three months 
or less. As at 31 December 2020 cash and cash equivalents, net of overdrafts, amounted to £649m (2019: £676m) of which £10m represent 
amounts subject to regulatory restrictions and are not readily available to be used for other purposes within the Group. Cash at bank earns 
interest at floating rates based on daily bank deposit rates. Short term deposits are made for varying periods of between one day and 
three months depending on the immediate cash requirements of the Group, and earn interest at the respective short term deposit rates.

Financial investments comprise short-term government securities, term deposits and restricted funds held with banks and  
clearing organisations.

Non-cash items represent interest expense, the amortisation of debt issue costs and recognition of new lease liabilities.

Annual Report and Accounts 2020
174

 
35. Contingent liabilities
Bank Bill Swap Reference Rate case
On 16 August 2016, a complaint was filed in the United States District Court for the Southern District of New York naming Tullett Prebon 
plc, ICAP plc, ICAP Australia Pty LTD and Tullett Prebon (Australia) Pty. Limited as defendants together with various Bank Bill Swap 
Reference Rate (‘BBSW’) setting banks. The complaint alleges collusion by the defendants to fix BBSW-based derivatives prices through 
manipulative trading during the fixing window and false BBSW rate submissions. On 26 November 2018, the Court dismissed all of the 
claims against the TP ICAP defendants and certain other defendants. On 28 January 2019, the Court ordered that a stipulation signed 
by the plaintiffs and the TP ICAP defendants meant that the TP ICAP defendants were not required to respond to any Proposed Second 
Amended Class Action Complaint (‘PSAC’) that the plaintiffs were seeking to file. On 3 April 2019 the plaintiffs filed a PSAC, however 
the TP ICAP defendants have no obligation to respond. The plaintiffs have reserved the right to appeal the dismissal of the TP ICAP 
defendants but have not as yet done so. It is not possible to predict the ultimate outcome of the litigation or to provide an estimate of 
any potential financial impact.

Labour claims – ICAP Brazil
ICAP do Brasil Corretora De Títulos e Valores Mobiliários Ltda (‘ICAP Brazil’) is a defendant in 11 (31 December 2019: 13) pending lawsuits 
filed in the Brazilian Labour Court by persons formerly associated with ICAP Brazil seeking damages under various statutory labour rights 
accorded to employees and in relation to various other claims including wrongful termination, breach of contract and harassment 
(together the ‘Labour Claims’). The Group estimates the maximum potential aggregate exposure in relation to the Labour Claims, 
including any potential social security tax liability, to be BRL 56.8m (£8m) (31 December 2019: BRL 49m (£11m)). The Group is the 
beneficiary of an indemnity from NEX in relation to any liabilities in respect of seven of the 11 Labour Claims insofar as they relate to 
periods prior to completion of the Group’s acquisition of ICAP. This includes a claim that is indemnified by a predecessor to ICAP Brazil by 
way of escrowed funds in the amount of BRL 28m (£4m). The Labour Claims are at various stages of their respective proceedings and are 
pending an initial witness hearing, the court’s decision on appeal or a ruling on a motion for clarification. The Group intends to contest 
liability in each of these matters and to vigorously defend itself. It is not possible to predict the ultimate outcome of these actions.

Flow case – Tullett Prebon Brazil
In December 2012, Flow Participações Ltda and Brasil Plural Corretora de Câmbio, Títulos e Valores (‘Flow’) initiated a lawsuit against 
Tullett Prebon Brasil S.A. Corretora de Valores e Câmbio and Tullett Prebon Holdings do Brasil Ltda alleging that the defendants have 
committed a series of unfair competition misconducts, such as the recruitment of Flow’s former employees, the illegal obtainment and use 
of systems and software developed by the plaintiffs, as well as the transfer of technology and confidential information from Flow and the 
collusion to do so in order to increase profits from economic activities. The amount currently claimed is BRL 272m (£38m) (31 December 
2019: BRL 243m (£44m)). The Group intends to vigorously defend itself but there is no certainty as to the outcome of these claims. Currently, 
the case is in an early evidentiary phase.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

LIBOR Class actions
The Group is currently defending the following LIBOR related actions:

(i) Stichting LIBOR Class Action
On 15 December 2017, the Stichting Elco Foundation, a Netherlands-based claim foundation, filed a writ initiating litigation in the Dutch 
court in Amsterdam on behalf of institutional investors against ICAP Europe Limited (‘IEL’), ICAP plc, Cooperative Rabobank U.A., UBS AG, 
UBS Securities Japan Co. Ltd, Lloyds Banking Group plc, and Lloyds Bank plc. The litigation alleges manipulation by the defendants of the 
JPY LIBOR, GBP LIBOR, CHF LIBOR, USD LIBOR, EURIBOR, TIBOR, SOR, BBSW and HIBOR benchmark rates, and seeks a declaratory 
judgment that the defendants acted unlawfully and conspired to engage in improper manipulation of benchmarks. If the plaintiffs succeed 
in the action, the defendants would be responsible for paying costs of the litigation, but each allegedly impacted investor would need to 
prove its own actual damages. It is not possible at this time to determine the final outcome of this litigation, but IEL has factual and legal 
defences to the claims and intends to defend the lawsuit vigorously. A hearing took place on 18 June 2019 on Defendants motions to 
dismiss the proceedings. On 14 August 2019 the Dutch Court issued a ruling dismissing ICAP plc from the case entirely but keeping certain 
claims against IEL relating solely to JPY LIBOR. On 9 December 2020, the Dutch Court issued a final judgement dismissing the Foundation’s 
claims in their entirety. The Foundation has until March 2021 to appeal this final judgement. The Group is covered by an indemnity from 
NEX in relation to any outflow in respect of the ICAP entities with regard to these matters. It is not possible to estimate any potential 
financial impact in respect of this matter at this time.

(ii) Swiss LIBOR Class Action
On 4 December 2017, a class of plaintiffs filed a Second Amended Class Action Complaint in the matter of Sonterra Capital Master Fund 
Ltd. et al. v. Credit Suisse Group AG et al. naming as defendants, among others, TP ICAP plc, Tullett Prebon Americas Corp., Tullett Prebon 
(USA) Inc., Tullett Prebon Financial Services LLC, Tullett Prebon (Europe) Limited, Cosmorex AG, ICAP Europe Limited, and ICAP Securities 
USA LLC (together, the ‘Companies’). The Second Amended Complaint generally alleges that the Companies conspired with certain bank 
customers to manipulate Swiss Franc LIBOR and prices of Swiss Franc LIBOR based derivatives by disseminating false pricing information 
in false run-throughs and false prices published on screens viewed by customers in violation of the Sherman Act (anti-trust) and RICO. On 
16 September 2019, the Court granted the Companies’ motions to dismiss in their entirety. The plaintiffs have appealed the dismissal to 
the United States Court of Appeals for the Second Circuit. The Companies intend to contest liability in the matter and to vigorously defend 
themselves. It is not possible to predict the ultimate outcome of this action or to provide an estimate of any potential financial impact.

Annual Report and Accounts 2020
175

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

35. Contingent liabilities continued 
LIBOR Class actions continued 
(iii) Yen LIBOR Class Actions
In April 2013, ICAP plc was added as a defendant to an existing civil litigation originally filed in April 2012, Laydon v. Mizuho Bank, Ltd, 
against certain Yen LIBOR and Euroyen TIBOR panel banks alleging purported manipulation of the Yen LIBOR and Euroyen TIBOR 
benchmark interest rates. The United States District Court for the Southern District of New York dismissed the plaintiff’s antitrust and unjust 
enrichment claims, but upheld the plaintiff’s claim for purported manipulation under the Commodity Exchange Act. ICAP plc and certain 
other foreign defendants were dismissed in March 2015 for lack of personal jurisdiction. The Court permitted plaintiffs to file an amended 
complaint whereby they added new defendants to the action including ICAP Europe Limited and Tullett Prebon plc. On 10 March 2017, 
both ICAP Europe Limited and Tullett Prebon plc were dismissed for lack of personal jurisdiction. On 23 October 2020, the plaintiffs served 
their formal notice of intent to appeal the dismissal of the TP ICAP defendants. The Group is covered by an indemnity from NEX in relation 
to any outflow in respect of ICAP Europe Limited with regard to these matters. It is not possible to predict the ultimate outcome of the 
litigation or to provide an estimate of any potential financial impact. 

Other plaintiffs filed a related complaint, Sonterra Capital Master Fund, Ltd. v. UBS AG, which included ICAP plc, ICAP Europe Limited and 
Tullett Prebon plc as defendants, asserting a cause of action for antitrust injury only as a result of the purported manipulation of Yen LIBOR 
and Euroyen TIBOR by panel banks and brokers. Defendants filed motions to dismiss for lack of jurisdiction and failure to state a claim. On 
10 March 2017, the Court issued an order dismissing the entirety of the Sonterra case on the grounds that the plaintiffs lacked antitrust 
standing. Plaintiffs appealed the dismissal, which was then stayed to accommodate new settlements reached between the plaintiffs and 
some of the defendants. The briefing on the appeal was completed on 28 January 2019 and oral argument was heard on 5 February 2020. 
On 1 April 2020, the Second Circuit Court of appeals reversed and remanded the dismissal. In October 2020, the Company filed a renewed 
motion to dismiss on grounds that were not reached in the original decision to dismiss including but not limited to lack of personal 
jurisdiction. It is not possible to predict the ultimate outcome of the litigation or to provide an estimate of any potential financial impact. 
The Group is covered by an indemnity from NEX in relation to any outflow in respect of ICAP Europe Limited with regard to these matters.

ICAP Securities Limited, Frankfurt branch – Frankfurt Attorney General administrative proceedings 
On 19 December 2018, ICAP Securities Limited, Frankfurt branch (‘ISL’) was notified by the Attorney General’s office in Frankfurt notifying 
ISL that it had commenced administrative proceedings against ISL and criminal proceedings against former employees and a former 
director of ISL, in respect of aiding and abetting tax evasion by Rafael Roth Financial Enterprises GmbH (‘RRFE’). It is possible that a 
corporate administrative fine may be imposed on ISL and earnings derived from the criminal offence confiscated. ISL has appointed 
external counsel and is in the process of investigating the activities of the relevant desk from 2006-2009. This investigation is complicated 
as the majority of relevant records are held by NEX and NEX failed to disclose its engagement with the relevant authorities prior to the sale 
of ICAP to Tullett Prebon in 2016. The Group has issued proceedings against NEX in respect of (i) breach of warranties under the sale and 
purchase agreement, and (ii) an indemnity claim under the tax deed entered into in connection with the IGBB acquisition in relation to 
these matters. Since the proceedings are at an early stage, details of the alleged wrongdoing or case against ISL are not yet available, 
and it is not possible at present to provide a reliable estimate of any potential financial impact on the Group.

ICAP Securities Limited and The Link Asset and Securities Company Limited – Proceedings by the Cologne Public Prosecutor
On 11 May 2020, TP ICAP learned that proceedings have been commenced by the Cologne Public prosecutor against ICAP Securities 
Limited (‘ISL’) and The Link Asset and Securities Company Ltd (‘Link’) in connection with criminal investigations into individuals suspected 
of aiding and abetting tax evasion between 2004 and 2012. It is possible that the Cologne Public Prosecutor may seek to impose an 
administrative fine against ISL or Link and confiscate the earnings that ISL or Link allegedly derived from the underlying alleged criminal 
conduct by the relevant individuals. ISL and Link have appointed external lawyers to advise them. The Group has issued proceedings 
against NEX in respect of (i) breach of warranties under the sale and purchase agreement, and (ii) an indemnity claim under the tax deed 
entered into in connection with the IGBB acquisition in relation to these matters. Since the proceedings are at an early stage, details of the 
alleged wrongdoing or case against ISL and Link are not yet available, and it is not possible at present to provide a reliable estimate of 
any potential financial impact on the Group.

Annual Report and Accounts 2020
176

Autorité des Marchés Financiers (‘AMF’)
In August 2019, Tullett Prebon (Europe) Limited (‘TPEL’) was notified that the AMF was investigating alleged facilitation of market abuse 
conduct concerning historical transactions with a client undertaken in 2015 on Eurex. In June 2020, the AMF initiated enforcement 
proceedings before the Enforcement Committee of the AMF. TPEL has responded to the AMF’s letter of grievance and is waiting to hear 
further. It is not possible at present to provide a reliable estimate of any potential financial impact on the Group.

General note
The Group operates in a wide variety of jurisdictions around the world and uncertainties therefore exist with respect to the interpretation 
of complex regulatory, corporate and tax laws and practices of those territories. Accordingly, and as part of its normal course of business, 
the Group is required to provide information to various authorities as part of informal and formal enquiries, investigations or market 
reviews. From time to time the Group’s subsidiaries are engaged in litigation in relation to a variety of matters. The Group’s reputation may 
also be damaged by any involvement or the involvement of any of its employees or former employees in any regulatory investigation and 
by any allegations or findings, even where the associated fine or penalty is not material.

Save as outlined above in respect of legal matters or disputes for which a provision has not been made, notwithstanding the uncertainties 
that are inherent in the outcome of such matters, currently there are no individual matters which are considered to pose a significant risk 
of material adverse financial impact on the Group’s results or net assets.

The Group establishes provisions for taxes other than current and deferred income taxes, based upon various factors which are continually 
evaluated, if there is a present obligation as a result of past events, it is probable that an outflow of resources embodying economic 
benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made.

In the normal course of business, certain of the Group’s subsidiaries enter into guarantees and indemnities to cover trading arrangements 
and/or the use of third-party services or software. 

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

36. Short-term or low value lease commitments

Minimum short-term and low value lease payments recognised in the income statement

2020 
£m
1

At 31 December 2020 the Group had outstanding commitments for future minimum lease payments under non-cancellable operating 
leases, which fall due as follows:

Within one year

2020

Buildings 
£m
1

Other 
£m
–

2019

Buildings
£m
–

2019
£m
2

Other
£m
–

37. Retirement benefits
(a) Defined benefit schemes
The Group has a defined benefit pension scheme in the UK and a small number of schemes operated in other countries. The overseas 
schemes are not significant in the context of the Group.

Defined benefit scheme surplus – UK
Defined benefit schemes deficit – Overseas

2020 
£m
–
(2)

2019
£m
–
(2)

(b) UK defined benefit scheme
The Group’s UK defined benefit pension scheme is the defined benefit section of the Tullett Prebon Pension Scheme (the ‘Scheme’).

The Scheme is a final salary, funded pension scheme that is closed to new members and future accrual. For members still in service there 
was a continuing link between benefits and pensionable pay, up to the date the Scheme commenced wind-up. The Principal Employer is 
Tullett Prebon Group Limited.

The assets of the Scheme are held separately from those of the Group, either in separate Trustee administered funds or in contract-based 
policies of insurance.

The latest funding actuarial valuation of the Scheme was carried out as at 30 April 2016 by independent qualified actuaries. The actuarial 
funding surplus of the Scheme at that date was £61m and under the agreed schedule of contributions the Group will continue not to make 
any payments into the Scheme.

Annual Report and Accounts 2020
177

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

37. Retirement benefits continued
(b) UK defined benefit scheme continued
During 2017, the Trustees of the Scheme purchased a bulk annuity policy with Rothesay Life, an insurance company, that covered all of the 
Scheme’s liabilities. The policy is in the name of the Scheme and is a Scheme asset. The purchase of the policy represents a bulk annuity 
‘buy-in’ and has been accounted for in accordance with the requirements of IAS 19 ‘Employee Benefits’. Under IAS 19, the accounting value 
of the purchased policy is set to be equal to the value of the liabilities covered, calculated using the current IAS 19 actuarial assumptions for 
the defined benefit obligation. 

The Scheme is exposed to counterparty risk of Rothesay Life as the insurance policy makes up the majority of Scheme assets. However, 
the Trustees of the Scheme are currently making arrangements for the transfer of the Scheme’s liabilities to the insurer to take on direct 
responsibility for the provision of benefits. If implemented, this would permanently extinguish the Group’s obligation to support the 
Scheme financially.

The amounts included in the balance sheet arising from the Group’s obligations in respect of the Scheme are as follows:

Fair value of Scheme assets 
Present value of Scheme liabilities
Defined benefit scheme surplus – UK
Impact of asset ceiling on UK scheme surplus:
At 1 January
Offset against deemed interest income in the Income Statement
Credit/(charged) to Other Comprehensive Income (application of asset ceiling of defined benefit 
pension schemes)
At 31 December

Recognised in the Consolidated Balance Sheet after application of the asset ceiling

Application of asset ceiling of defined benefit pension schemes
Remeasurement of the defined benefit pension scheme
Recognised in Other Comprehensive Income

Deferred tax liability (Note 21)

2020 
£m
276
(227)
49

(52)
(1)

4
(49)

–

4
(2)
2

–

2019
£m
257
(205)
52

–
–

(52)
(52)

–

–
(52)
(52)

–

During 2019 the Trustee commenced proceedings to ‘buy-out’ the Scheme’s liabilities, a process that will enable the Trustee to exchange 
the Scheme’s bulk annuity policy for individual policies issued to, and directly held, by the Scheme’s beneficiaries. To proceed with the 
‘buy-out’, the Sponsor and Trustee commenced the wind-up of the Scheme. Prior to this, the Trustee had no right to unilaterally wind-up, or 
otherwise augment the benefits due to members and based on those limitations the net surplus was recognised in full by the Group. Under 
UK legislation, once a Scheme commences wind-up, the assets of the Scheme pass unconditionally to the Trustee to enable it to settle the 
Scheme’s liabilities. As a result, the Group has applied the requirements of IFRIC 14, restricting the Group’s recognition of the net surplus by 
applying an asset recognition ceiling. The asset ceiling is recorded in other comprehensive income.

During the wind-up period, the Group will continue to restrict the recognition of the net surplus. Costs associated with the settlement of 
the Scheme’s liabilities are recorded as significant items in the Income Statement. Settlement costs amounted to £1m in 2020 (2019: £1m).

Following the full settlement of the Scheme’s liabilities the Scheme will be wound up and the Sponsor expects to receive the remaining 
assets. Any repayment received will also be subject to applicable taxes at that time, currently 35%. 

The main financial assumptions used by the independent qualified actuaries of the Scheme to calculate the liabilities under IAS 19 were:

Key assumptions
Discount rate
Expected rate of salary increases
Rate of increase in LPI pensions in payment1
Inflation assumption

2020
%

1.4%
n/a
2.7%
2.4%

2019
%

2.00
n/a
2.70
2.30

1  This applies to pensions accrued from 6 April 1997. The majority of current and future pensions receive fixed increases in payment of either 0% or 2.5%.

Annual Report and Accounts 2020
178

The mortality assumptions are based on standard mortality tables and allow for future mortality improvements and are the same as those 
adopted for the 2016 funding valuation. Assumptions for the Scheme are that a member who retires in 15 years’ time at age 60 will live 
on average for a further 31.7 years (2019: 31.6 years) after retirement if they are male and for a further 33.1 years (2019: 33.0 years) after 
retirement if they are female. Current pensioners are assumed to have a generally shorter life expectancy based on their current age.

The valuation of the Scheme liabilities is sensitive to changes in the assumptions used. The effect of changes in the discount rate, 
inflation and mortality assumptions, assuming an independent change in one assumption with all others held constant, on the liabilities 
is shown below:

As at 31 December 2020
Following a 0.25% decrease in the discount rate

Following a 0.25% increase in the inflation assumption

Life expectancy increases by 3 years

Scheme
assets 
£m
275
4.4%
287
1.8%
280
8.0%
298

Scheme 
liabilities
£m
(226)
5.3%
(238)
2.2%
(231)
10.2%
(249)

Surplus
£m
49

49

49

49

Change
New value
Change
New value
Change
New value

The above analysis does not reflect any inter-relationship between the assumptions.

The above changes have been derived by adjusting the actuarial calculation of the Scheme’s liabilities at 31 December 2020 to allow 
for the assumption change. Changes to the risks inherent in the Scheme would result in changes to the Scheme’s carrying value. However, 
as a result of the bulk annuity purchase, the value of the Scheme’s insurance asset matches changes in the insured liabilities. The value of 
Scheme’s surplus assets will change as the market value of those investments change.

The amounts recognised in the income statement in respect of the Scheme were as follows:

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Deemed interest arising on the defined benefit pension scheme surplus
Impact of asset ceiling on UK scheme surplus
Recognised in the Consolidated Income Statement
Past service and settlement costs
Scheme’s administrative costs

The amounts recognised in other comprehensive income in respect of the Scheme were as follows:

Return on Scheme assets (excluding deemed interest income) – Trustee administered funds
Return on Scheme assets (excluding deemed interest income) – revaluation of insurance policies
Actuarial losses arising from changes in financial assumptions
Actuarial gains arising from experience adjustments
Remeasurement of the defined benefit pension scheme

Movements in the present value of the Scheme liabilities were as follows:

At 1 January
Deemed interest cost
Past service cost
Actuarial losses arising from changes in financial assumptions
Actuarial gains arising from experience adjustments
Benefits paid/transfers out
At 31 December

2020
£m
1
(1)
–
(1)
(1)
(2)

2020 
£m
(1)
26
(29)
2
(2)

2020 
£m
(205)
(4)
–
(29)
2
10
(226)

2019
£m
1
(1)
–
(4)
–
(4)

2019
£m
(1)
23
(23)
1
–

2019 
£m
(188)
(5)
(3)
(23)
1
13
(205)

Annual Report and Accounts 2020
179

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

37. Retirement benefits continued
(b) UK defined benefit scheme continued
Movements in the fair value of the Scheme assets were as follows:

At 1 January
Deemed interest income
Return on Scheme assets (excluding deemed interest income) – Trustee administered funds
Return on Scheme assets (excluding deemed interest income) – revaluation of insurance policies
Benefits paid/transfers out
Past service and settlements costs
Scheme’s administrative costs
At 31 December

The major categories and fair values of the Scheme assets as at 31 December were as follows:

Cash and cash equivalents
Government bonds
Insurance policies
Other receivables
At 31 December

2020 
£m
257
5
(1)
26
(10)
(1)
(1)
275

2020 
£m
39
14
222
–
275

2019
£m
243
6
(1)
23
(13)
–
(1)
257

2019 
£m
2
52
202
1
257

During 2017, as part of the arrangements for insuring the Scheme’s liabilities, the Trustees transferred all of the Scheme’s equity 
investments into fixed income securities and bonds. The Scheme does not hedge against foreign currency exposures or interest rate risk.

The Scheme duration is an indicator of the weighted average time until benefit payments are made. For the Scheme as a whole, the 
duration is around 20 years reflecting the approximate split of the defined benefit liability between current employees (duration of 
25 years), deferred members (duration of 23 years) and current pensioners (duration of 13 years).

The estimated amounts of contributions expected to be paid into the Scheme during 2020 is £nil.

(c) Defined contribution pensions
The Group operates a number of defined contribution schemes for qualifying employees. The assets of these schemes are held separately 
from those of the Group.

The defined contribution pension cost for the Group charged to administrative expenses was £19m (2019: £17m), of which £9m (2019: £8m) 
related to overseas schemes.

As at 31 December 2020, there was £1m outstanding in respect of the current reporting year that had not been paid over to the schemes 
(2019: £1m).

Annual Report and Accounts 2020
180

38. Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not 
disclosed in this Note.

The total amounts owed to and from associates and joint ventures at 31 December 2020, which also represent the value of transactions 
during the year. The total amounts owed to and from related parties at 31 December 2020 are set out below:

Associates
Joint ventures
Loans from related parties

Amounts owed by  
related parties

Amounts owed to  
related parties

2020
£m
5
–
–

2019 
£m
3
–
–

2020
£m
–
(3)
(28)

2019
£m
–
(3)
–

In August 2020, the Group entered into a 10 billion Yen (£71 million) committed facility with the Tokyo Tanshi Co., Ltd, a related party, that 
matures in February 2023. The loan for related parties is conducted on an arm’s length basis. At 31 December 2020, £28m of the facility 
was drawn down.

The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No provisions have been 
made for doubtful debts in respect of the amounts owed by related parties.

During the year, less than £1m of interest was paid on loans from related parties. 

Directors
Costs in respect of the Directors who were the key management personnel of the Group during the year are set out below in aggregate for 
each of the categories specified in IAS 24 ‘Related Party Disclosures’. Further information about the individual Directors is provided in the 
audited part of the Report on Directors’ Remuneration on pages 87 to 93.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Short-term benefits
Social security costs

2020
£m
5
1
6

2019 
£m
6
1
7

39. Events after the balance sheet date
In February 2021, the shareholders of TP ICAP plc approved the re-domiciliation of the Group from the UK to Jersey by means of a scheme 
of arrangement pursuant to Part 26 of the Companies Act 2006 (the Scheme). At the same meeting, the shareholders also approved the 
proposed acquisition of the Liquidnet group, to be partially funded by a £315m rights issue. On 16 February 2021, the rights issue raised 
£309m cash net of fees.

The Scheme became effective on 26 February 2021 and, as a result, TP ICAP Group plc became the new parent company of the Group. 

Shortly after the Scheme became effective, the former parent company of the Group, TP ICAP plc, changed its status to that of a private 
company and was renamed TP ICAP Limited. The Non-executive Directors (including the Chair) of TP ICAP plc were appointed as Non-
executive Directors of TP ICAP Group plc, in each case with effect from the Scheme effective date (the Executive Directors were already 
appointed to the Board of TP ICAP Group plc). Members of the committees of the Board of TP ICAP plc were appointed as members of the 
equivalent committees of the Board of TP ICAP Group plc on the Scheme effective date. It is expected that the Non-executive Directors of 
TP ICAP Limited will resign from the Board on 9 March 2021.

Following the loss of the EU passporting rights as a result of the UK’s withdrawal from the EU, TP ICAP’s UK-based authorised subsidiaries 
no longer have the full scope of necessary regulatory permissions to service all clients based in the EU 27. TP ICAP’s UK-based authorised 
subsidiaries continue to service clients based in certain EU 27 member states where possible under available temporary permission 
regimes, existing third country access rights, or as otherwise permitted by applicable laws and regulations. In those EU 27 member states 
where TP ICAP’s existing operating model does not allow it to service clients under available temporary permission regimes, existing third 
country access rights, or applicable laws and regulations, TP ICAP is adjusting its operating model to ensure that it services clients in those 
jurisdictions in accordance with such temporary permission regimes, existing third country access rights, or applicable laws and regulations. 
Such adjustments include, amongst other things, obtaining additional third country permissions for its UK authorised firms and servicing 
clients from its EU establishments once a sufficient number of brokers have been relocated from the UK.

Annual Report and Accounts 2020
181

 
 
 
 
 
 
 
Notes to the Consolidated Financial Statements continued
for the year ended 31 December 2020

40. Principal subsidiaries
At 31 December 2020, the following companies were the Group’s principal subsidiary undertakings. A full list of the Group’s undertakings, 
the country of incorporation and the Group’s effective percentage of equity owned is set out in the listing on pages 191 to 199. 
All subsidiaries are involved in broking or information sales activities and have either a 31 December or 31 March year end.

Country of incorporation and operation
Australia
Bermuda (operating in England)
Brazil

England

France
Guernsey (operating in England)
Hong Kong
Japan
Singapore

United States

Principal subsidiary undertakings
ICAP Brokers Pty Limited
PVM Oil Associates Limited
ICAP do Brasil Corretora de Títulos e Valores Mobiliários Ltda
Tullett Prebon Brasil Corretora de Valores e Cambio Ltda
ICAP Energy Limited
ICAP Europe Limited
ICAP Global Derivatives Limited
ICAP Information Services Limited
ICAP Management Services Limited
ICAP Securities Limited
Tullett Prebon (Europe) Limited
Tullett Prebon (Securities) Limited
TP ICAP (Europe) S.A.
Tullett Prebon Information Limited 
Tullett Prebon (Hong Kong) Limited 
Tullett Prebon (Japan) Limited
ICAP (Singapore) Pte Limited
TP ICAP Management Services (Singapore) Pte. Ltd.
Tullett Prebon Energy (Singapore) Pte. Ltd. 
PVM Oil Associates Pte. Ltd.
ICAP Corporates LLC
ICAP Energy LLC
ICAP Information Services Inc.
ICAP Securities USA LLC
Tullett Prebon Americas Corp.
Tullett Prebon Financial Services LLC
PVM Futures Inc
PVM Petroleum Markets LLC
Tullett Prebon Information Inc

Issued ordinary  
shares, all voting 
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
80%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%

As at 31 December 2020, £19m (2019: £18m) is due to non-controlling interests relating to those subsidiaries that are not wholly owned. 
Movements in non-controlling interests are set out in Note 30(c). No individual non-controlling interest is material to the Group. There are 
no significant restrictions on the ability of the Group to access or use assets and settle liabilities relating to these subsidiaries.

Annual Report and Accounts 2020
182

Company Balance sheet
as at 31 December 2020

Non-current assets
Investment in subsidiary undertakings
Trade and other receivables

Current assets
Trade and other receivables
Cash and cash equivalents
Derivative financial instruments

Total assets
Current liabilities
Trade and other payables
Interest bearing loans and borrowings

Net current liabilities
Total assets less current liabilities
Non-current liabilities
Interest bearing loans and borrowings
Other long-term payables

Total liabilities
Net assets

Capital and reserves
Share capital
Share premium
Merger reserve
Own shares
Profit and loss account
Total equity

Notes

4
5

5

6
8

8
7

9

2020
£m

3,240
–
3,240

43
6
3
52
3,292

(405)
(39)
(444)
(392)
2,900

(679)
–
(679)
(1,123)
2,169

141
17
1,262
(27)
776
2,169

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019 
£m

2,935
23
2,958

35
23
–
58
3,016

(106)
(11)
(117)
(59)
2,899

(678)
(6)
(684)
(801)
2,215

141
17
1,262
(16)
811
2,215

The Company reported a profit for the financial year ended 31 December 2020 of £56m (2019: loss £9m).

The Financial Statements of TP ICAP Limited (registered number 5807599) were approved by the Board of Directors and authorised for 
issue on 9 March 2021 and are signed on its behalf by

Nicolas Breteau
Chief Executive Officer

Annual Report and Accounts 2020
183

 
 
 
 
 
 
 
Statement of Changes in Equity
for the year ended 31 December 2020

2020
Balance at 1 January 2020
Profit and total comprehensive income for the year
Dividends paid
Share settlement of share-based payment awards
Own shares acquired for employee trusts
Credit arising on share-based awards
Balance at 31 December 2020

2019
Balance at 1 January 2019
Loss and total comprehensive income for the year
Dividends paid
Share settlement of share-based payment awards
Own shares acquired for employee trusts
Credit arising on share-based awards
Balance at 31 December 2019

Share 
capital
£m

Share
premium
account 
£m

141
–
–
–
–
–
141

141
–
–
–
–
–
141

17
–
–
–
–
–
17

17
–
–
–
–
–
17

Note 9

Merger
reserve
£m

1,262
–
–
–
–
–
1,262

1,262
–
–
–
–
–
1,262

Own
shares 
£m

Profit and
loss 
account
£m

(16)
–
–
3
(14)
–
(27)

(11)
–
–
2
(7)
–
(16)

811
56
(94)
(3)
–
6
776

912
(9)
(94)
(3)
–
5
811

Total 
equity
£m

2,215
56
(94)
–
(14)
6
2,169

2,321
(9)
(94)
(1)
(7)
5
2,215

Annual Report and Accounts 2020
184

Notes to the Company Financial Statements
for the year ended 31 December 2020

1. Basis of preparation
As at 31 December 2020 the Company was a public company limited by shares. On 8 March 2021 the Company re-registered as 
a limited company.

The separate Financial Statements of the Company are presented as required by the Companies Act and are prepared in accordance 
with the requirements of FRS 101 ‘Reduced Disclosure Framework’. They have been prepared under the historical cost convention, except 
for the revaluation of certain financial instruments held at fair values at the end of each reporting period, as explained in the accounting 
policies and in accordance with applicable United Kingdom law and United Kingdom Generally Accepted Accounting Practice. As 
discussed on page 43 of the Strategic Report, the Directors have a reasonable expectation that the Company has adequate resources to 
continue in operational existence for the foreseeable future. Accordingly, the going concern basis continues to be used in preparing these 
Financial Statements.

As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available under that standard in relation to 
share-based payments, financial instruments, capital management, presentation of comparative information in respect of certain assets, 
presentation of a cash flow statement, fair value measurements, reserve and certain related party transactions, and the non-disclosure of 
Standards, Interpretations and Amendments that are not yet effective. 

2. Significant accounting policies
The principal accounting policies adopted are the same as those set out in Note 3 to the Consolidated Financial Statements except as 
noted below.

Investments in subsidiaries are stated at cost less, where appropriate, provisions for impairment. Estimation is required when determining 
the realisable value of investment.

The Company has share-based payment arrangements involving employees of its subsidiaries. The cost of these arrangements is measured 
by reference to the fair value of equity instruments on the date they are granted. Cost is recognised in ‘investment in subsidiary undertakings’ 
and credited to the ‘profit and loss account’ reserve on a straight-line basis over the vesting period. Where the cost is subsequently 
recharged to the subsidiary, it is recognised as a reduction in ‘investment in subsidiary undertakings’.

The Company is the sponsor of the TP ICAP plc Employee Benefit Trust and applies the ’look-through’ approach to the Trust’s assets, 
liabilities and results which are included as part of the Company.

3. Profit for the year
As permitted in section 408 of the Companies Act 2006 the Company has elected not to present its own profit and loss account for the year.

The auditor’s remuneration for audit and other services is disclosed in Note 5 to the Consolidated Financial Statements. The Company has 
no employees (2019: nil). Information about individual Directors is provided in the audited part of the Report on Directors’ remuneration 
on pages 92 to 108.

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

Annual Report and Accounts 2020
185

 
 
 
 
 
 
 
Notes to the Company Financial Statements continued
for the year ended 31 December 2020

4. Investment in subsidiary undertakings

Cost
At 1 January
Capital contribution arising on share-based awards
Increase in investment in subsidiary undertaking
Transfer from immediate subsidiary undertaking
Transfer to immediate subsidiary undertaking
Impairment in subsidiary undertaking
At 31 December

2020
£m

2,935
6
–
305
–
(6)
3,240

2019 
£m

2,681
5
419
384
(384)
(170)
2,935

Further information about subsidiaries, including disclosures about non-controlling interests, is provided in the ‘Group Undertakings’ 
section of this Annual Report on pages 191 to 199.

The investments in subsidiary undertakings are stated at cost less impairment. 

Determining whether the carrying value of investments in subsidiaries is impaired requires an estimation of the recoverable amount of 
each subsidiary. The recoverable amount is the higher of value in use (‘VIU’) or its net realisable value (‘NRV’). Value in use requires 
estimation of future cash flows expected to arise, the selection of suitable discount rates and the estimation of future growth rates. Future 
projections are based on the most recent projections considered by the Board which are used to project future pre-tax cash flows for the 
next five years. After this period a steady state cash flow is used to derive a terminal value for each subsidiary. Net tangible assets is used 
as a proxy for NRV. 

As at 31 December 2020, effective growth rate was 1.84% (2019: 1.8%) over a five-year projected period, with effective pre tax discount 
rates of 12.96% (2019: 12%). A 1% increase in the discount rate would result in an impairment of less than £1m and coupled with a reduction 
of 0.5% in effective growth rates, the impairment would increase to £1m. 

No deferred tax has been recognised on temporary differences associated with unremitted earnings of subsidiaries as the Company is able 
to control the timing of distributions and overseas dividends are largely are exempt from UK tax.

2020
£m

–

17
25
1
43

2020
£m
7
398
–
405

2019 
£m

23

20
13
2
35

2019 
£m
1
89
16
106

5. Trade and other receivables

Non-current receivables
Amounts owed by Group undertakings

Current receivables
Amounts owed by Group undertakings
Corporation tax
Prepayments and accrued income

6. Trade and other payables

Accruals and deferred income
Amounts due to Group undertakings
Deferred consideration

Annual Report and Accounts 2020
186

7. Other long-term payables

Amounts owed to Group undertakings

8. Interest bearing loans and borrowings

2020
Loans from related party
Sterling Notes January 2024
Sterling Notes May 2026

2019
Sterling Notes January 2024
Sterling Notes May 2026

2020
£m
–
–

Less than 
one year 
£m 

Greater than
one year 
£m

28
10
1
39

10
1
11

–
430
249
679

430
248
678

S
t
r
a
t
e
g
i
c
r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e
r
e
p
o
r
t

F
i
n
a
n
c
i
a
l
s
t
a
t
e
m
e
n
t
s

2019
£m
6
6

Total 
£m

28
440
250
718

440
249
689

Bank credit facilities and bank loans
In December 2019 the Company extended its £270m committed revolving facility, that would have matured in December 2021. The new 
maturity of the facility is December 2023. Facility commitment fees of 0.8% on the undrawn balance are payable on the new facility, 
reduced from 1.0% that were payable on the cancelled facility. Arrangement fees of £3m were incurred in 2018 and will be amortised over 
the maturity of the new facility. 

As at 31 December 2020, the £270m revolving credit facility was undrawn. Amounts drawn down are reported as bank loans in the above 
table. Bank loans are denominated in Sterling and their carrying amount approximated to their fair value. 

Interest and facility fees of £3m were incurred in 2020 (2019: £3m). 

Loans from related parties
In August 2020, the Group entered into a Yen 10bn (£71m) committed facility with The Tokyo Tanshi Co., Ltd, a related party, that matures 
in February 2023. Facility commitment fees of 0.64%. on the undrawn balance are payable on the facility. Arrangement fees of less than 
£1m are being amortised over the maturity of the facility. 

As at 31 December 2020, Yen 4bn (£28m) of the facility was drawn. The Directors consider that the carrying amount of the loan which is not 
held at fair value through profit or loss approximates to its fair value. Amounts drawn down are reported as loans from related parties in 
the above table. 

Interest and facility fees of less than £1m were incurred in 2020.

Sterling Notes: Due January 2024
In January 2017 the Group issued £500m unsecured Sterling Notes due January 2024. The Notes have a fixed coupon of 5.25% paid 
semi-annually, subject to compliance with the terms of the Notes. In 2019 the Group repurchased Notes with a par value £69m for £72m 
including accrued interest. At 31 December 2020 the fair value of the Notes (Level 1) was £473m. Accrued interest at 31 December 2020 
amounted to £10m (2019: £10m). The amortisation expense of issue costs in 2020 and 2019 were less than £1m.

Sterling Notes: Due May 2026
In May 2019 the Group issued £250m unsecured Sterling Notes due May 2026. The Notes have a fixed coupon of 5.25% paid semi-annually, 
subject to compliance with the terms of the Notes. At 31 December 2019 the fair value of the Notes (Level 1) was £270m. Accrued interest at 
31 December 2020 amounted to £1m. The amortisation expense of issue costs in 2020 and 2019 were less than £1m.

Annual Report and Accounts 2020
187

 
 
 
 
 
 
 
Notes to the Company Financial Statements continued
for the year ended 31 December 2020

9. Share capital and reserves

Allotted, issued and fully paid
Ordinary shares of 25p

2020
No.

2019 
No.

563,336,380
563,336,380

563,336,380
563,336,380

The movement in the number of shares during the year is shown in Note 29 to the Consolidated Financial Statements.

Allotted, issued and fully paid
Ordinary shares of 25p

2020
£m

141

2019 
£m

141

Descriptions of the merger reserve and own shares, together with the movements in those reserves, are disclosed in Note 30 to the 
Consolidated Financial Statements.

The distributable reserves of the Company at 31 December 2020 were £702m (2019: £743m), representing the balance on the Profit and 
loss account, less cumulative unrealised credits in respect of share-based payment awards.

10. Contingent liabilities
In the normal course of business the Company enters into arrangements with certain of its undertakings to enable those entities to meet 
their liabilities as and when they fall due. Such arrangements are for a period of no more than two years.

11. Events after the balance sheet date 
In February 2021, the shareholders of TP ICAP plc approved the re-domiciliation of the Group from the UK to Jersey by means of a scheme 
of arrangement pursuant to Part 26 of the Companies Act 2006 (the Scheme). At the same meeting, the shareholders also approved the 
proposed acquisition of the Liquidnet group, to be partially funded by a £315m rights issue. On 16 February 2021, the rights issue raised 
£309m cash net of fees.

The Scheme became effective on 26 February 2021 and, as a result, TP ICAP Group plc became the new parent company of the Group. 

Shortly after the Scheme became effective, the former parent company of the Group, TP ICAP plc, changed its status to that of a private 
company and was renamed TP ICAP Limited. The Non-executive Directors (including the Chair) of TP ICAP plc were appointed as Non-
executive Directors of TP ICAP Group plc, in each case with effect from the Scheme effective date (the Executive Directors were already 
appointed to the Board of TP ICAP Group plc). Members of the committees of the Board of TP ICAP plc were appointed as members of the 
equivalent committees of the Board of TP ICAP Group plc on the Scheme effective date. It is expected that the Non-executive Directors of 
TP ICAP Limited will resign from the Board on 9 March 2021.

On changing its status to a private company, the Company proposes to undertake a capital reduction by way of solvency statement and 
will transfer its investments in its subsidiaries to the new parent company of the Group.

Annual Report and Accounts 2020
188

TP ICAP Group plc Shareholder Information

Financial calendar
TP ICAP Limited Preliminary Results – 9 March 2021
Ex-dividend date for final dividend – 8 April 2021
Record date for final dividend – 9 April 2021
Final date for Dividend Reinvestment Plan election – 26 April 2021
Annual General Meeting – Wednesday 12 May 2021 at 2.15pm
Final dividend payment date (if dividend approved at AGM) – 18 May 2021

Dividends
A final dividend of 2p per ordinary share will be recommended to shareholders at the 2021 AGM.

Dividend mandate
Shareholders who wish their dividends to be paid directly into a bank or building society account should register their mandate via the 
shareholder portal at www.signalshares.com. You will need your investor code which can be found on your share certificate or dividend 
confirmation. Alternatively, contact Link Group for a dividend mandate form. This method of payment removes the risk of delay or loss of 
dividend cheques in the post and ensures that shareholders’ accounts are credited on the dividend payment date. For future dividends, 
the Company has in place a facility for payments to be made via CREST.

Dividend Reinvestment Plan (‘DRIP’)
The Company offers a DRIP, where your dividend can be reinvested in further TP ICAP Group plc shares through a specially arranged share 
dealing service. For further information contact Link Group whose contact details are set out below.

Shareholder information on the internet
The Company maintains an investor relations page on its website, www.tpicap.com, which allows access to both current and historic share 
price information, Directors’ biographies, copies of Company reports, selected press releases and other useful investor information.

Registrar
Link Group act as the Company’s registrars. As such administrative queries regarding your shareholding (including notifying a change 
of name or address, queries regarding dividend payments and the DRIP scheme, etc) are best directed to Link Group who can be 
contacted at:

Link Group
10th Floor
Central square
29 Wellington Street
Leeds
LS1 4DL
United Kingdom

Email: enquiries@linkgroup.co.uk
Telephone: 0371 664 0300¹

1  Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable International rate. 

Lines are open 9.00am – 5.30pm, Monday to Friday excluding public holidays in England and Wales.

Many of our shareholders find that the easiest way to manage their shareholdings is online, using the free, simple and secure 
service provided by the Company’s registrar, Link Group. To access and maintain your shareholding online, please register at  
www.signalshares.com

Shareholder security
TP ICAP encourages all shareholders to be wary of any unsolicited advice, offers to buy shares at a discount or offers of free company 
annual reports. If you receive any unsolicited investment advice, whether over the telephone, through the post or by email, you should;

 >  Make sure you note the name of the organisation and, if possible, the name of the individual contacting you.
 >  Check they are properly authorised by the FCA by visiting https://register.fca.org.uk/ and  

www.fca.org.uk/consumers/report-scam-unauthorised-firm.

Any details of share dealing facilities that TP ICAP endorses will be included in the Company’s mailings.

Annual Report and Accounts 2020
189

TP ICAP Group plc Shareholder Information continued

Auditor
Deloitte LLP
Chartered Accountants and Statutory Auditor
1 New Street Square
London EC4A 3HQ
United Kingdom
www.deloitte.com

Registered office
TP ICAP Group plc
22 Grenville Street
St Helier
Jersey
JE48PX

Telephone: +44 (0)1534 676720
Website: www.tpicap.com

TP ICAP Group plc is a company registered in Jersey with registered number 130617.

TP ICAP Limited Registered office
Floor 2
155 Bishopsgate
London
EC2M 3TQ

Annual Report and Accounts 2020
190

Group undertakings

In accordance with section 409 of the Companies Act 2006, a full list of related undertakings, the country of incorporation, and the 
effective percentage of equity owned as at 31 December 2020 are listed below. Unless otherwise stated, the undertakings below are wholly 
owned and the share capital disclosed comprises ordinary shares or common stock (or the local equivalent thereof) which are indirectly 
held by the Company.

Company name
ICAP Brokers Pty Limited

Country of incorporation
Australia

Interest

Footnote

ICAP Futures (Australia) Pty Ltd

Australia

TP ICAP Management Services 
(Australia) Pty Limited 
Tullett Prebon (Australia) Pty Limited

Australia

Australia

PVM Data Services GmbH

ICAP (Middle East) W.L.L.

Austria

Bahrain

Tullett Liberty (Bahrain) Co. W.L.L.

Bahrain

PVM Oil Associates Ltd

Bermuda

ICAP do Brasil Corretora de Títulos 
e Valores Mobiliários Ltda 

Brazil

ICAP do Brasil Participações Ltda

Brazil

Tullett Prebon Brasil Corretora de 
Valores e Câmbio Ltda.
Tullett Prebon Holdings Do Brasil Ltda. Brazil

Brazil

49%

82.7%

Catrex Limited

British Virgin Islands

LCM D Limited

British Virgin Islands

Vantage Capital Holdings Limited

British Virgin Islands

Tullett Prebon Americas Corp., Toronto 
Branch
Tullett Prebon Canada Limited

SIF ICAP Chile Holdings Ltda

SIF ICAP Chile SpA

Enmore Commodity Brokers 
(Shanghai) Co. Ltd.
ICAP Shipping (Shanghai) Co,. Ltd.

Operating in Canada

Canada

Chile

Chile

China

China

50%

2

40%

49%

Prebon Yamane International Limited, 
Shanghai Representative Office
Tullett Prebon SITICO (China) Limited

Operating in China

China

33%

15

Annual Report and Accounts 2020
191

Registered office address
Level 27, 9 Castlereagh Street, Sydney, New 
South Wales, 2000, Australia
Level 27, 9 Castlereagh Street, Sydney, New 
South Wales, 2000, Australia
Level 27, 9 Castlereagh Street, Sydney, New 
South Wales, 2000, Australia
Level 29, 9 Castlereagh Street, Sydney NSW 
2000, Australia
Euro Plaza–Building G, Am Euro Platz 2, 1120 
Vienna, Austria
PO Box 5488, 43rd Floor, 4301, West Tower, 
Bahrain Financial Harbour, Bahrain
PO Box 20526, Flat No.11, Building 104, 383 
Road 2831, Manama 316, Bahrain
Coson Corporate Services Limited, Cedar House, 
3rd Floor, 41 Cedar Avenue, Hamilton HM12, 
Bermuda
Avenida das Américas, 3.500, Ed. Londres, 2º 
andar, Barra da Tijuca, Rio de Janeiro-RJ, CEP 
22640-102–Brasil
Avenida das Américas, 3.500, Ed. Londres, 2º 
andar, Barra da Tijuca, Rio de Janeiro-RJ, CEP 
22640-102–Brasil
Rua São Tomé, 86, 21º andar, Vila Olímpia, São 
Paulo-SP, CEP 04551-030–Brasil
Rua São Tomé, 86, 21º andar, Vila Olímpia, São 
Paulo-SP, CEP 04551-030–Brasil
Vistra Corporate Services Centre, Wickhams 
Cay II, Road Town, Tortola, VG1110, British 
Virgin Islands 
Citco B.V.I Limited, Fleming House, Wickhams 
Cay, PO Box 662, Road Town, Tortola, British 
Virgin Islands
Portcullis Chambers, 4th Floor, Ellen Skelton 
Building, 3076 Sir Francis Drake Highway, Road 
Town, Tortola, British Virgin Islands
1 Toronto Street, Suite 301, PO Box 20, Toronto, 
Ontario, M5C 2V6, Canada
 1 Toronto Street, Suite 308, PO Box 20, Toronto, 
Ontario, M5C 2V6, Canada
Magdalena 181 Piso 14 Las Condes, Santiago, 
Chile 7550055
Magdalena 181 Piso 14 Las Condes, Santiago, 
Chile 7550055
Room 720, Building 3, No. 999 Jinzhong Road, 
Changning District, Shanghai, China
Room B01, 3rd Floor, New China Life Insurance 
Tower, No.558 Dong Da Ming Road, Hongkou 
District, Shanghai; China
Room 1002, DBS Tower, No.1318, Lujiazui Ring 
Road, Shanghai, 200120, China
Room 1001, DBS Tower, No.1318, Lujiazui Ring 
Road, Shanghai, 200120, China

Group undertakings 
continued

Company name
ICAP Colombia Holdings S.A.S.

Country of incorporation
Colombia

SET-ICAP FX S.A.

SET-ICAP Securities S.A.

Colombia

Colombia

Footnote

Interest
94.2%

47.9%

47.4%

TP ICAP (Europe) S.A., Danish Branch

Operating in Denmark

ICAP del Ecuador S.A.

Ecuador

Louis Capital Markets France SA
Louis Capital Markets UK, LLP French 
Branch
Midcap Partners SAS
TP ICAP (Europe) SA

France
France

France
France

Tullett Prebon (Europe) Limited, 
Paris Branch
Astley & Pearce Deutschland GmbH

ICAP Ltd. & Co. oHG

Operating in France

Germany

Germany

ICAP Securities Limited, 
Frankfurt Branch
Intermoney AP & Co. Geld-und 
Eurodepotmakler OHG
TP ICAP (Europe) S.A., Frankfurt Branch Operating in Germany

Operating in Germany

Germany

Tullett Prebon (Securities) Limited, 
Frankfurt Branch
ICAP US Holdings No 1 Limited
ICAP US Holdings No 2 Limited
Tullett Prebon Information Limited

ICAP (Hong Kong) Limited

Operating in Germany

Gibraltar
Gibraltar
Guernsey, Operating in 
UK
Hong Kong

ICAP Securities Hong Kong Limited

Hong Kong

TP ICAP Management Services 
(Hong Kong) Limited
Tullett Prebon (Hong Kong) Limited

Hong Kong

Hong Kong

Tullett Prebon Asia Group Limited

Hong Kong

74.7%

2

14

ICAP IL India Private Limited

India

40%

10

P.T. Inti Tullett Prebon Indonesia

Indonesia

57.5%

PT ICAP Indonesia

Indonesia

99%

1

PT Electronic IDR Exchange

Indonesia

49%

Annual Report and Accounts 2020
192

Registered office address
Km 33 Via Sopo Aposentos C-64 Municipio 
Sopó, Cundinamarca, Colombia
Carrera 11 No. 93-46–Oficina 403, Bogotá, 
Colombia
Carrera 11 No. 93-46–Oficina 403, Bogotá, 
Colombia
Rentemestervej 14, Copenhagen NV, DK-2400, 
Denmark
Eloy Alfaro 2515 y Catalina Aldáz, N34-189, 
Quito, Ecuador
42, rue Washington, 75008 Paris, France
42, rue Washington, 75008 Paris, France

42, rue Washington, 75008 Paris, France
89/91 rue de faubourg, Saint Honore, 75008 
Paris, France
89/91 rue de faubourg, Saint Honore, 75008 
Paris, France
Stephanstrasse 14-16, 60313 Frankfurt am Main, 
Germany
Stephanstrasse 14-16, 60313 Frankfurt am Main, 
Germany
Stephanstrasse 14-16, 60313 Frankfurt am Main, 
Germany
Stephanstrasse 3, 60313 Frankfurt am Main, 
Germany
Stephanstrasse 14-16, 60313 Frankfurt am Main, 
Germany
Bleidenstraße 6-10, 60311 Frankfurt am Main, 
Germany
Suite 1, Burns House, 19 Town Range, Gibraltar
Suite 1, Burns House, 19 Town Range, Gibraltar
Third floor, Cambridge House, Le Truchot, St 
Peter Port, GY1 1WD, Guernsey
20/F, One Hennessy, No. 1 Hennessy Road, Wan 
Chai, Hong Kong
20/F, One Hennessy, No. 1 Hennessy Road, Wan 
Chai, Hong Kong
21/F, One Hennessy, No. 1 Hennessy Road, Wan 
Chai, Hong Kong
21/F, One Hennessy, No. 1 Hennessy Road, Wan 
Chai, Hong Kong
21/F, One Hennessy, No. 1 Hennessy Road, Wan 
Chai, Hong Kong
Office No. 6, 3rd Floor, C Wing, Laxmi Towers, 
Bandra Kurla Complex, Bandra (E), Mumbai, 
400051, Maharashtra, India
Menara Dea, Tower 2, 12th floor–Suite 1202, 
Mega Kuningan area, Jalan Mega Kuningan 
Barat Kav. E4.3 No. 1-2, Jakarta 12950
Menara Dea Tower II 12th Floor, Kawasan Mega 
Kuningan, Jl. Mega Kuningan Barat Kav. E4.3, 
Jakarta 12950, Indonesia
Menara Astra, 11th Floor, Jl. Jend. Sudirman Kav. 
5-6, Karet Tengsin District, Tanah Abang 
Sub-District, Central Jakarta 10220, Indonesia

Company name
Louis Capital Markets Israel Ltd

Country of incorporation
Israel

Interest

Footnote

20%

60%

40%

5%

80%

80%

58.3%

50%

50%

50%

50%

50%

50%

2

2

11

12

13

Central Totan Securities Co. Ltd

Japan

ICAP Totan Securities Co., Ltd.

Totan ICAP Co., Ltd.

Japan

Japan

Tokyo Tanshi Co. Limited

Japan

tpSEF Inc., Tokyo Branch

Operating in Japan

Tullett Prebon (Japan) Limited

Tullett Prebon ETP (Japan) Ltd

Japan

Japan

M.W. Marshall (Overseas) Limited

Jersey 

Prebon Marshall Yamane (C.I.) Limited Jersey 

Tullett Prebon Money Brokerage (Korea) 
Limited
ICAP Luxembourg Holdings (No. 1) 
S.A.R.L
ICAP Luxembourg Holdings (No. 2) 
S.A.R.L
ICAP US Holdings No 2 Limited, 
Luxembourg Branch
ICAP (Malaysia) Sdn. Bhd 

Korea, Republic of

Luxembourg

Luxembourg

Operating in 
Luxembourg
Malaysia

ICAP Bio Organic S. de RL de CV

Mexico

Plataforma Mexicana de Carbono 
S. de R.L. de C.V.
SIF Agro S.A. De C.V.

Mexico

Mexico

SIF ICAP Derivados, S.A. DE C.V.

Mexico

SIF ICAP Servicios, S.A. de C.V.

Mexico

SIF ICAP, S.A. de C.V.

Mexico

Tullett Prebon Mexico SA de CV
Astley & Pearce (International) B.V.

Mexico
Netherlands

Astley & Pearce B.V.

Netherlands

ICAP Energy AS, Netherlands Branch

ICAP Energy Limited, 
Netherlands Branch
ICAP Holdings (Nederland) B.V.

Operating in The 
Netherlands 
Operating in The 
Netherlands 
Netherlands

Annual Report and Accounts 2020
193

Registered office address
45 Rothschild boulevard, 6578403 Tel-Aviv, 
Israel
4-4-10, Nihonbashi Muromachi, Chuo-ku, Tokyo 
103-0022 Japan
4-4-10, Nihonbashi Muromachi, Chuo-ku, Tokyo 
103-0022 Japan
7th Floor, Totan Muromachi Building, 4-4-10 
Nihonbashi Muromachi, Chuo-ku, Tokyo, 
103-0022, Japan
4-4-10 Nihonbashi Muromachi Chuo-ku, Tokyo 
103-0022, Japan
Akasaka Tameike Tower 4th Floor, 2-17-7 
Akasaka Minato-ku, Tokyo 107-0052, Japan
Akasaka Tameike Tower 4th Floor, 2-17-7 
Akasaka Minato-ku, Tokyo 107-0052, Japan
Akasaka Tameike Tower 4th Floor, 2-17-7 
Akasaka Minato-ku, Tokyo 107-0052, Japan
22 Grenville Street (was previously Equity Trust 
House, 28-30 The Parade, St Helier, JE4 8XY, 
Jersey) 
22 Grenville Street (was previously Equity Trust 
House, 28-30 The Parade, St Helier, JE4 8XY, 
Jersey) 
6th Floor, Douzone Eulji Tower, 29 Eulji-ro, 
Jung-gu, Seoul, Korea
17 Boulevard du Prince Henri, L-1724 
Luxembourg, Luxembourg
17 Boulevard du Prince Henri, L-1724 
Luxembourg, Luxembourg
17 Boulevard du Prince Henri, L-1724 
Luxembourg, Luxembourg
802, 8th Floor, Block C, Kelana Square, 17 Jalan 
SS7/26, 47301 Petaling Jaya, Selangor Darul 
Ehsan, Malaysia
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
Paseo de la Reforma No 255, Piso 7, Colonia 
Cuauhtemoc, 06500 D F Mexico, Mexico
n/a 
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Vijzelstraat 68, office 109, 1017HL Amsterdam, 
the Netherlands
Vijzelstraat 68, office 109, 1017HL Amsterdam, 
the Netherlands
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands

Group undertakings 
continued

Company name
ICAP Investments (Nederland) B.V.

Country of incorporation
Netherlands

Interest

Footnote

ICAP Latin American Holdings B.V.

Netherlands

ICAP Securities (No. 1) B.V.

Netherlands

ICAP Securities (No. 2) B.V.

Netherlands

iSwap Euro B.V. 

Netherlands

50.1%

Prebon Holdings B.V.

Netherlands

TP ICAP (Europe) S.A., 
Netherlands Branch
Tullett Liberty B.V.

Operating in The 
Netherlands 
Netherlands

ICAP New Zealand Limited

New Zealand

ICAP African Brokers Limited

Nigeria

66.3%

ICAP Energy AS
Norway
Operating in Norway
ICAP Energy Limited, Norway Branch
TP ICAP (Europe) S.A., Norway Branch Operating in Norway
Datos Técnicos, S.A.
ICAP Management Services Limited, 
Philippine Branch

Peru
Operating in Philippines

25%

ICAP Philippines Inc.

Philippines

99.9%

1, 3

Tullett Prebon (Philippines) Inc.

Philippines

51%

Tullett Prebon (Polska) S.A.
ICAP (Singapore) Pte. Ltd.

Poland
Singapore

1

ICAP Energy (Singapore) Pte Ltd

Singapore

Noranda Investments Pte Ltd

Singapore

PVM Oil Associates Pte. Ltd

Singapore

PVM Oil Futures Pte. Ltd

Singapore

TP ICAP Holdings (Singapore) Pte. Ltd Singapore

TP ICAP Management Services 
(Singapore) Pte. Ltd
Tullett Prebon (Singapore) Limited

Tullett Prebon Energy (Singapore) 
Pte. Ltd.

Singapore

Singapore

Singapore

Annual Report and Accounts 2020
194

Registered office address
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Coengebouw–Suite 8.02, Kabelweg 37, 
Amsterdam, 1014 BA, Netherlands
Vijzelstraat 68, office 109, 1017HL Amsterdam, 
the Netherlands
Telestone 8–Teleport, Naritaweg 165, 1043 BW, 
Amsterdam, Netherlands
Vijzelstraat 68, office 109, 1017HL Amsterdam, 
the Netherlands
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Level 12, 36 Customhouse Quay, Wellington, 
6000, New Zealand
Plot 1679, 4th Floor, African Re-Insurance 
Building, Karimu Kotun Street, Victoria Island, 
Lagos State, Nigeria
Storetveitvegen 96, 5072 Bergen, Norway
Storetveitvegen 96, 5072 Bergen, Norway
Storetveitvegen 96, 5072 Bergen, Norway
Pasaje Acuña 106–Lima, Peru
14th Floor, RCBC Savings Bank Corporate 
Centre, 26th and 25th Streets, Bonifacio South, 
Bonifacio Global City, Taguig City, 1634, 
Philippines
14th Floor, RCBC Savings Bank Corporate 
Centre, 26th and 25th Streets, Bonifacio South, 
Bonifacio Global City, Taguig City, 1634, 
Philippines
14th Floor, RCBC Savings Bank Corporate 
Centre, 26th and 25th Streets, Bonifacio South, 
Bonifacio Global City, Taguig City, 1634, 
Philippines
00-684 Warszawa, ul. Wspólna 47/49, Poland
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore
50 Raffles Place, #39-00, Singapore Land 
Tower, 048623, Singapore
50 Raffles Place, #41-00, Singapore Land Tower, 
048623, Singapore

Company name
Garban South Africa (Pty) Limited

Country of incorporation
South Africa

ICAP Broking Services South Africa 
(Pty) Ltd
ICAP Holdings South Africa (Pty) 
Limited
ICAP Securities South Africa 
(Proprietary) Limited
Tullett Prebon South Africa (Pty) 
Limited
Corretaje e Informacion Monetaria y 
de Divisas SA
ICAP Energy AS, Spain Branch

South Africa

South Africa

South Africa

South Africa

Spain

21.5%

4

Operating in Spain

Footnote

Interest
66.3%

66.3%

66.3%

66.3%

ICAP Energy Limited, Spain Branch

Operating in Spain

TP ICAP (Europe) S.A., Madrid Branch Operating in Spain

Tullett Prebon (Europe) Limited, 
Spanish Branch
Cosmorex AG
ICAP Energy Suisse S.A.

Operating in Spain

Switzerland 
Switzerland

1

Tullett Prebon (Securities) Limited, 
Geneva Branch
Taipei Forex Inc

ICAP Securities Co., Ltd.

Operating in Switzerland 

Tawain

Thailand

5%

ICAP-AP (Thailand) Co., Ltd.

Thailand

Nextgen Holding Co., Ltd.

Thailand

99.9%

8

75.7%

5

20%

Altex-ATS Limited

Automated Confirmation Service 
Limited
ClearCompress Limited

Cleverpride Limited

Coex Partners Limited

Emsurge Limited

Exco Bierbaum AP Limited

Exco International Limited

Exco Nominees Limited

Exco Overseas Limited

UK

UK

UK

UK

UK

UK

UK

UK

UK

UK

Annual Report and Accounts 2020
195

Registered office address
19 Impala Road, Block A GF, Chislehurston, 
Sandton, 2196, South Africa
19 Impala Road, Block A GF, Chislehurston, 
Sandton, 2196, South Africa
19 Impala Road, Block A GF, Chislehurston, 
Sandton, 2196, South Africa
19 Impala Road, Block A GF, Chislehurston, 
Sandton, 2196, South Africa
3rd Floor, Fredman Towers, 13 Fredman Drive, 
Sandton 2196, Gauteng, South Africa
Principe de Vergara nº 131, 3º floor, 28002 
Madrid, Spain.
Avenida de la Vega 1, Edificio, Planta 3, Office 
15, Madrid, 28108 Alcobendas, Spain
Avenida de la Vega 1, Edificio, Planta 3, Office 
15, Madrid, 28108 Alcobendas, Spain
Paseo de la Castellana, edificio Torre Europa Pl 
10B, 28046 Madrid, Spain
Torre Europa, Paseo de la Castellana 95, planta 
10, 28046 Madrid, Spain
Zürcherstrasse 66, 8800 Thalwil, Switzerland 
Lavaterstrasse 40, C/o Pannell Ker Forster AG, 
8002 Zurich, Switzerland
Route de Pré-Bois 29, World Trade Center II, 1215 
Genève 15 cases, Switzerland 
8/F, 400 Sec 2, PA Teh Road, Taipei, Taiwan 
(Province of China)
No. 55 Wave Place Building, 13th Floor, Wireless 
Road, Khwaeng Lumpini, Khet Patumwan, 
Bangkok, 10330, Thailand
No. 55 Wave Place Building, 13th Floor, Wireless 
Road, Khwaeng Lumpini, Khet Patumwan, 
Bangkok, 10330, Thailand
No. 55 Wave Place Building, 13th Floor, Wireless 
Road, Khwaeng Lumpini, Khet Patumwan, 
Bangkok, 10330, Thailand
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
ISIS Building, Marsh Wall, London, E14 9SG, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
1 Garrick Close, Hersham, Walton-On-Thames, 
United Kingdom, KT12 5NY
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England

Group undertakings 
continued

Company name
Garban Group Holdings Limited 

Country of incorporation
UK

Interest

Footnote

Garban International

Garban-Intercapital (2001) Limited

Garban-Intercapital US Investments 
(Holdings) Limited
Garban-Intercapital US Investments 
(No 1) Limited
Glia Ecosystems Limited

Harlow (London) Limited

ICAP America Investments Limited

UK

UK

UK

UK

UK

UK

UK

ICAP Corporates LLC, UK Branch

Operating in UK

ICAP Energy Limited

ICAP Europe Limited

UK

UK

ICAP Global Broking Finance Limited

UK

20%

ICAP Global Broking Holdings Limited UK

5

ICAP Global Broking Investments

ICAP Global Derivatives Limited

ICAP Holdings (Asia Pacific) Limited

ICAP Holdings (EMEA) Limited

UK

UK

UK

UK

ICAP Holdings (Latin America) Limited UK

ICAP Holdings (UK) Limited

ICAP Holdings Limited

ICAP Information Services Limited

ICAP Management Services Limited

ICAP Securities Limited

UK

UK

UK

UK

UK

ICAP Securities USA LLC, UK Branch

Operating in UK

ICAP UK Investments No. 1

ICAP UK Investments No. 2

UK

UK

ICAP US Holdings No 1 Limited, 
UK Branch
ICAP US Holdings No 2 Limited, 
UK Branch

Operating in UK

Operating in UK

Annual Report and Accounts 2020
196

Registered office address
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
4 Claridge Court, Lower Kings Road, 
Berkhamsted, Hertfordshire, England, HP4 2AF
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England

Company name
ICAP WCLK Limited

Country of incorporation
UK

Interest

Footnote

50.1%

50.1%

50.1%

8

81%
85%

2
3, 4

50%

3

50%

5

iSwap Euro Limited

UK

iSwap Euro B.V., UK Branch

Operating in UK

iSwap Limited

LCM Europe Limited

LCM Trading LLP 
LiquidityChain Limited

Louis Capital Markets UK LLP

Midcap Partners Limited

Patshare Limited

Prebon Group Limited

Prebon Limited

UK

UK

UK
UK

UK

UK

UK

UK

UK

Prebon Yamane International Limited UK

PVM Oil Futures Limited

PVM Smart Learning Limited

The Link Asset and Securities 
Company Limited
TP Holdings Limited

UK

UK

UK

UK

TP ICAP (Europe) S.A., UK Branch

Operating in UK

TP ICAP Group Services Limited

Tullett Prebon (Equities) Limited

Tullett Prebon (Europe) Limited

Tullett Prebon (No. 3) Limited

Tullett Prebon (Securities) Limited

Tullett Prebon (UK) Limited.

UK

UK

UK

UK

UK

UK

Tullett Prebon Administration Limited

UK

Tullett Prebon Group Holdings plc

Tullett Prebon Information Limited

Tullett Prebon Investment Holdings 
Limited

UK

UK

UK

Annual Report and Accounts 2020
197

Registered office address
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
130 Wood Street, 4th Floor, London, EC2V 6DL, 
England

130 Wood Street, 4th Floor, London EC2V 6DL.
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
130 Wood Street, 4th Floor, London, EC2V 6DL, 
England
130 Wood Street, 4th Floor, London, EC2V 6DL, 
England

Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
1 The Lockers, Bury Hill, Hemel Hempstead, 
England, HP1 1SR
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England

Group undertakings 
continued

Company name
Tullett Prebon Latin America 
Holdings Limited
Tullett Prebon Pension Trustee Limited UK

Country of incorporation
UK

PVM Oil Associates Ltd, UK Branch

Operating in UK

Interest

Footnote

Zodiac Seven Limited

UK

41.3%

TP ICAP (Dubai) Limited

United Arab Emirates 

US

US

US

US

US

US

US

US

US
US

US

US

US
US

US

US

US

US

US

US
US

US

US

US

Atlas Commodity Markets, LLC

Atlas Physical Grains, LLC

Axiom Refined Products LLC

Coex Partners Inc.

Exco Noonan Pension LLC

First Brokers Securities LLC

Growth & Emerging Markets LLC

ICAP Corporates LLC

ICAP Energy LLC
ICAP Global Broking Inc.

ICAP Information Services Inc.

ICAP Media LLC

ICAP Merger Company LLC
ICAP North America Inc.

ICAP Securities USA LLC

ICAP SEF (US) LLC

ICAP Services North America LLC

iSwap US Inc.

Louis Capital Markets LLC

M.W. Marshall Inc.
PVM Futures Inc.

PVM Oil Associates Inc.

PVM Petroleum Markets LLC

Revelation Holdings, Inc.

Annual Report and Accounts 2020
198

40%

16.2%

50.1%

1, 6

6

1, 6

6

10

6

6

6

6

6

6

1

6

1, 17

Registered office address
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
Floor 2, 155 Bishopsgate, London, EC2M 3TQ, 
England
71-75 Shelton Street, Covent Garden, London, 
WC2H 9JQ
Unit 107 & 108, Level 1, Gate Village Building 1, 
DIFC, PO Box 506787, Dubai, UAE
Two Greenway Plaza, Suite 600, Houston, TX 
77046, United States
Two Greenway Plaza, Suite 600, Houston, TX 
77046, United States
Two Greenway Plaza, Suite 600, Houston, TX 
77046, United States
251 Little Falls Drive, Wilmington, DE 19808, 
United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
1209 Orange Street, Wilmington, Delaware, 
19801, United States
251 Little Falls Drive, Wilmington, DE 19808, 
United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
421 West Main Street, Frankfort, KY 40601
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
80 State Street, Albany NY 12207, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
80 State Street, Albany, NY 12207, United States
Princeton South Corporate Center, Suite 160, 
100 Charles Ewing Blvd, Ewing, New Jersey, 
08628, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
211 E. 7th Street, Suite 620, Austin, TX, 78701, 
United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States

Company name
SCS Energy Corp.
SCS OTC Corp.
TP ICAP Americas Holdings Inc.

Country of incorporation
US
US
US

Interest

Footnote
1
1

TP ICAP Acquisitions Co.

tpSEF Inc.

Tullett Prebon Americas Corp.

US

US

US

Tullett Prebon Financial Services LLC

US

Tullett Prebon Information Inc.

Wrightson ICAP LLC

US

US

6

6

Registered office address
80 State Street, Albany, NY 12207, United States
80 State Street, Albany, NY 12207, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, New Castle 
County, Delaware 19809
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States
251 Little Falls Drive, Wilmington, Delaware, 
19808, United States

In liquidation/dissolution

Footnotes
1 
2  Partnership interest
3  A ordinary shares
4  B ordinary shares
5  Directly held
6  Membership interest
7  Class B ordinary
8  Voting, CM, DM and Deferred shares
9  Class B units
10  Non-cumulative non-convertible redeemable preference shares (100%) and ordinary shares (40%)
11  Series I ordinary shares and series II ordinary shares
12  Series IB shares
13  Class I Shares and Class II Shares
14  Ordinary shares & Redeemable Preference shares
15  Group B ordinary shares
16  Class A, Class B and Class C common shares

Annual Report and Accounts 2020
199

Appendix – Alternative Performance Measures

Alternative performance measures (‘APMs’) are complementary to measures defined within International Financial Reporting Standards 
(‘IFRS’) and are used by management to explain the Group’s business performance and financial position. They include common industry 
metrics, as well as measures management and the Board consider are useful to enhance the understanding of its performance and allow 
meaningful comparisons between periods, Regions and Business Segments. The APMs reported are monitored consistently by the Group 
to manage performance on a monthly basis. 

APMs are defined below. Complementary definition, commentary, and outlook of those APMs considered important in measuring the 
delivery of the Group’s strategic priorities can be found on pages 28 and 42 of the Annual Report. Detailed reconciliations of APMs to 
their nearest IFRS Income Statement equivalents and adjusted APMs can be found in this section, if not readily identifiable from the 
Annual Report.

The APMs the Group uses are:

Term
Adjusted performance
Adjusted operating margin

Broking contribution

Broking contribution margin

Constant Currency

Contribution

Contribution margin

Data & Analytics contribution

Data & Analytics contribution margin

Diversified revenue
Earnings
EBIT

EBITDA

Free Cash Flow

Significant Items

Definition
Measure of performance excluding the impact of significant items
Adjusted operating profit margin is adjusted operating profit expressed as a percentage of 
reported revenue and is calculated by dividing adjusted operating profit by reported revenue 
for the period
Used interchangeably with EBIT
Represents total broking revenues less total front office costs of the Global Broking, Energy & 
Commodities and Institutional Services divisions, inclusive of the revenue internally generated 
to the Data & Analytics business
Broking contribution margin is Broking contribution expressed as a percentage of reported 
revenue and is calculated by dividing Broking contribution by reported Broking revenue
Comparison of current year results with the prior year will be impacted by movements in 
foreign exchange rates versus GBP, the Group’s presentation currency. In order to present a 
better comparison of underlying performance in the period, the Group retranslates foreign 
denominated prior year results at current year exchange rates
Contribution represents revenue less the direct costs of generating that revenue. Contribution is 
calculated as the sum of Broking contribution and Data & Analytics contribution
Contribution margin is contribution expressed as a percentage of reported revenue and is 
calculated by dividing contribution by reported revenue
Represents Data & Analytics revenue less total front office costs associated with running the 
business, including the cost of internally generated data from the broking business
Data & Analytics contribution margin is Data & Analytics contribution expressed as a 
percentage of reported revenue and is calculated by dividing Data & Analytics contribution by 
reported Data & Analytics revenue
Sum of Energy & Commodities, Institutional Services and Data & Analytics revenue 
Used interchangeably with Profit for the year
Earnings before net interest and tax
Used interchangeably with adjusted operating profit
Earnings before net interest, tax, depreciation, amortisation of intangible assets and share of 
equity accounted investments’ profit after tax
Cash generated from operations after interest paid, income tax paid, and dividends received 
from equity accounted investments, interest received and capital expenditure
Items that distort year-on-year comparisons, which are excluded in order to improve 
predictability and understanding of the underlying trends of the business, to arrive at adjusted 
operating and profit measures

Annual Report and Accounts 2020
200

1. Constant Currency – Revenue by segment

Revenue by Division
 > Rates
 > Credit
 > FX & Money Markets
 > Emerging Markets
 > Equities
 > Inter-division revenues
Total Global Broking
Energy & Commodities
 > Inter-division revenues
Total Energy & Commodities
Institutional Services
Data & Analytics
Inter-division eliminations
Reported Revenues

Revenue by Region
EMEA
Americas
Asia Pacific
Reported Revenues

2. Constant Currency – Adjusted operating expenses

Operating expenses
 > Broker compensation
 > Other front office costs
 > Data & Analytics costs
Total front office costs
 > Other staff costs
 > Technology and related costs
 > Premises and related costs
 > Depreciation and amortisation
 > Other administrative costs
Total management and support costs
Adjusted operating costs

2020 
£m

510
90
186
183
201
18
1,188
388
3
391
91
145
(21)
1,794

888
670
236
1,794

2020 
£m

902
162
 50
 1,114
224
69
27
56
46
 422
1,536

2019
£m
Reported

2019
£m
Constant  
Currency

Reported  
change

Constant  
Currency 
Change

537
94
201
213
199
18
1,262
379
3
382
75
135
(21)
1,833

900
687
246
1,833

2019
£m
Reported

900
193
46
1,139
215
59
26
56
75
431
1,570

534
93
200
209
196
18
1,250
376
3
379
75
133
(21)
1,816

898
675
243
1,816

2019
£m
Constant  
Currency

893
189
46
1,128
213
58
26
55
74
426
1,554

-5%
-4%
-7%
-14%
+1%
0%
-6%
+2%
0%
+2%
+21%
+7%
0%
-2%

-1%
-2%
-4%
-2%

-4%
-3%
-7%
-12%
+3%
0%
-5%
+3%
0%
+3%
+21%
+9%
0%
-1%

-1%
-1%
-3%
-1%

Reported 
change

Constant  
Currency 
Change

0%
-16%
+9%
-2%
+4%
+17%
+4%
0%
-39%
-2%
-2%

+1%
-14%
+9%
-1%
5%
+19%
+4%
0%
-38%
-1%
-1%

Annual Report and Accounts 2020
201

Appendix – Alternative Performance Measures 
continued

3. Operating costs by type

2020
Employment costs 
General and administrative expenses
Depreciation and impairment of PPE and ROUA
Amortisation and impairment of intangibles assets
Impairment of other assets 

2019
Employment costs 
General and administrative expenses
Depreciation and impairment of PPE and ROUA
Amortisation and impairment of intangibles assets
Impairment of other assets 

IFRS 
Reported
£m
1,153 
360 
37 
59 
23 
1,632

IFRS 
Reported
£m
1,154
435
34
69
24
1,716

Significant 
Items
£m
(6)
(27)
(1)
(39)
(23)
(96)

Significant 
Items
£m
(20)
(55)
(1)
(46)
(24)
(146)

Adjusted 
£m
1,147
333
36
20
–
1,536

Adjusted 
£m
1,134
380
33
23
–
1,570

Allocated as 
Front Office
£m
923
190
–
1
–
1,114

Allocated as Front 
Office
£m
919
218
1
1
–
1,139

Allocated as 
Support
£m
224
143
36
19
–
422

Allocated as 
Support
£m
215
162
32
22
–
431

4. Adjusted earnings
The earnings used in the calculation of adjusted earnings per share are set out below:

Earnings for the year 
Non-controlling interests
Earnings 
Significant items (page 34)
Taxation on significant items 
Adjusted earnings 

5. Provisions – movements relating to significant items

2020
At 1 January 2020
Charge/(credit) to income statement
 > significant items
 > other
Utilisation of provision
 > significant items
 > other
Effect of movements in exchange rates
At 31 December 2020

Net movement relating to significant items of £(5)m.

2020
£m
97
(1)
96
94
(7)
183

Property 
£m

Restructuring
£m

Legal 
and other
£m

6

2
–

(1)
–
–
7

8

5
3

(5)
(2)
–
9

33

(2)
(3)

(4)
–
–
24

2019
£m
68
(1)
67
137
(15)
189

Total 
£m

47

5
–

(10)
(2)
–
40

Annual Report and Accounts 2020
202

Appendix – Directors report of TP ICAP Group plc 
For the period from 23 December 2019 to 31 December 2020 
Company Number 130617

The directors present their Annual Report and the audited financial 
statements for the period from incorporation on 23 December 2019 
to 31 December 2020 (the “period”).

Principal activity and review of the business
TP ICAP Group plc is a holding company incorporated in Jersey. 
It is a public company limited by shares. Pursuant to a Scheme of 
Arrangement (the ‘Scheme’) in the United Kingdom on 26 February 
2021, TP ICAP Group plc became the new parent company of 
TP ICAP plc (subsequently renamed TP ICAP Limited and these 
names have been used interchangeably throughout this report) and 
its subsidiaries (together the ‘Group’). Shareholders of TP ICAP plc 
at the date of the Scheme received one share in TP ICAP Group plc 
in exchange for each share held in TP ICAP plc. 

The executive directors of TP ICAP Group plc are also executive 
directors of TP ICAP plc. The Non-executive Directors (including the 
Chair) of TP ICAP plc were appointed as Non-executive Directors of 
TP ICAP Group plc with effect from the Scheme effective date on 
26 February 2021. Members of the committees of the board of 
TP ICAP plc were also appointed as members of the equivalent 
committees of the board of TP ICAP Group plc on the Scheme 
effective date. The directors prepared the Annual Report of 
TP ICAP Limited as if it remained quoted on the date of approval 
on the financial statements, including the relevant disclosures 
required by the UK Listing Authority’s Disclosure Guidance and 
Transparency Rules (“DTR”). With the exception of the Scheme, 
and TP ICAP Group plc becoming the new parent of the Group, 
the Group remains fundamentally unchanged and, therefore, the 
DTR disclosures in the TP ICAP Limited Annual Report are also 
applicable for TP ICAP Group plc. 

Going concern
As TP ICAP Group plc became the new parent company of TP ICAP 
plc and its subsidiaries on 26 February 2021, the directors have 
performed a going concern assessment for the Group in determining 
whether TP ICAP Group plc is a going concern. The Group has 
sufficient financial resources to meet the Group’s ongoing 
obligations. The Directors have assessed the outlook of the Group, 
including consideration of the enlarged group following the 
anticipated acquisition of the Liquidnet group, for at least 
12 months from date of approval of the financial statements by 
considering medium term projections as well as stress tests and 
mitigation plans. These forecasts and stress tests take into account 
both the ongoing COVID-19 pandemic and Brexit. Based on this 
assessment the Directors have a reasonable expectation that the 
Group has adequate resources to continue in operational existence 
for the foreseeable future. Accordingly, the Annual Report continues 
to be prepared on the going concern basis. 

Compliance with the UK Corporate Governance Code
The directors reviewed the principles and provisions of the UK 
Corporate Governance Code 2018 (the ‘Code’) and its compliance 
with the Code as the successor holding company of the Group from 
26 February 2021. The directors confirm that TP ICAP Group plc has 
applied the Code principles and complied in full with the provisions 
from the 26 February 2021 to the date of this Annual Report. 
Compliance with the Code by the predecessor holding company of 
the Group, TP ICAP Limited, is set out in the Group’s Annual Report 
and Accounts 2020. The Code can be found on the Financial 
Reporting Council (‘FRC’) website, www.frc.org.uk.

Compliance with the UK Listing Authority’s Listing rules, 
Disclosure Guidance and Transparency Rules
The directors reviewed the principles and provisions of the UK 
Listing Authority’s Listing rules, Disclosure Guidance and 
Transparency Rules (the ‘Rules’), and confirm TP ICAP Group plc’s 
compliance with the Rules as the successor holding company of the 
Group from 26 February 2021 to the date of this Annual report. 

Directors
The following persons were directors of TP ICAP Group plc during 
the period and up to the date of this report, unless otherwise stated:

N Breteau (appointed on 23 December 2019)
R Stewart (appointed on 23 December 2019)
P Price (appointed on 23 December 2019)
R Berliand (appointed on 26 February 2021)
R Perkin (appointed on 26 February 2021)
E Ng (appointed on 26 February 2021)
K Cates (appointed on 26 February 2021)
T Clarke (appointed on 26 February 2021)
A Crawford-Ingle (appointed on 26 February 2021)
M Heaney (appointed on 26 February 2021)
M Hemsley (appointed on 26 February 2021)
A Knight (appointed on 26 February 2021)

Directors’ responsibilities
The directors are responsible for preparing the Annual Report and 
financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements 
for each financial year. Under that law the directors have elected to 
prepare the financial statements in accordance with Financial 
Reporting Standard 102 (“FRS 102”). Under company law the 
directors must not approve the financial statements unless they are 
satisfied that they give a true and fair view of the state of affairs of 
the company and the profit or loss of the company for that period.

In preparing these financial statements, the directors are required to:

 > select suitable accounting policies and then apply them consistently;
 > make judgements and accounting estimates that are reasonable 

and prudent;

 > state whether FRS 102 has been followed, subject to any material 
departures disclosed and explained in the financial statements; and

 > prepare the financial statements on the going concern basis 

unless it is inappropriate to presume that TP ICAP Group plc will 
continue in business.

The directors confirm they have complied with all the above 
requirements in preparing the financial statements.

The directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain TP ICAP Group plc’s 
transactions and disclose with reasonable accuracy at any time the 
financial position of TP ICAP Group plc and enable them to ensure 
that the financial statements  comply with the Companies (Jersey) 
Law, 1991. They are also responsible for safeguarding the assets of 
TP ICAP Group plc and hence for taking reasonable steps for the 
prevention and detection of fraud and other irregularities.

This report is authorised for issue by the board of directors. 

Approved by the board and signed on its behalf by:

Annual Report and Accounts 2020
203

R Stewart 
Director
23 March 2021

 
Independent Auditor’s Report to the members of TP ICAP Group plc

Report on the audit of the financial statements

1. Opinion

In our opinion the financial statements of TP ICAP Group plc: 

 > give a true and fair view of the state of the TP ICAP Group 

plc’s affairs as at 31 December 2020 and of the TP ICAP Group 
plc’s result for the period then ended;

 > have been properly prepared in accordance with United 

Kingdom Generally Accepted Accounting Practice, including 
Financial Reporting Standard 102 “The Financial Reporting 
Standard applicable in the UK and Republic of Ireland”; and
 > have been properly prepared in accordance with Companies 

(Jersey) Law, 1991.

We have audited the financial statements which comprise:

 > the Income Statement;
 > the Balance Sheet; and
 > the related notes 1 to 11.

The financial reporting framework that has been applied in their 
preparation is applicable law and United Kingdom Accounting 
Standards, including Financial Reporting Standard 102 “The 
Financial Reporting Standard applicable in the UK and Republic of 
Ireland” (United Kingdom Generally Accepted Accounting Practice).

2. Basis for opinion
We conducted our audit in accordance with International 
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our 
responsibilities under those standards are further described in the 
auditor’s responsibilities for the audit of the financial statements 
section of our report. 

We are independent of TP ICAP Group plc in accordance with the 
ethical requirements that are relevant to our audit of the financial 
statements in the UK, including the Financial Reporting Council’s 
(the ‘FRC’s’) Ethical Standard as applied to listed entities, and we 
have fulfilled our other ethical responsibilities in accordance with 
these requirements. 

We believe that the audit evidence we have obtained is sufficient 
and appropriate to provide a basis for our opinion.

3. Summary of our audit approach

Key audit matters

The key audit matter that we identified 
in the current period was:

Materiality

 > Accounting for the waiver from TP 

ICAP Limited

The materiality that we used in the 
current period was £368 which was 
determined on the basis of 3% of 
expenses (excluding the external 
audit fee).

4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that 
the directors’ use of the going concern basis of accounting in the 
preparation of the financial statements is appropriate. 

In December 2019, TP ICAP Limited (formerly TP ICAP plc) and its 
subsidiaries (together the “TP ICAP group” or the “group”) 
announced its intention to put in place a new Jersey-incorporated, 
United Kingdom tax resident parent company by means of a 
scheme of arrangement pursuant to Part 26 of the Companies Act 
2006. The Scheme became effective on 26 February 2021 and, at 
that time, TP ICAP Group plc became the new parent company of 
the Group. Therefore, our evaluation of the directors’ assessment of 
TP ICAP Group plc’s ability to continue to adopt the going concern 
basis of accounting included the following procedures over the 
ability of the TP ICAP group to continue as a going concern:

 > Challenging the underlying data and key assumptions used to 
make the assessment, including cash flow forecasts, impact of 
the proposed acquisition of Liquidnet Holdings Inc and its 
subsidiaries and the impact of COVID-19;

 > Performing stress tests in relation to key assumptions;
 > Evaluating the group directors’ plans for future actions, including 
evaluating the feasibility of the mitigating actions that they 
control, in relation to their going concern assessment; and

 > Considering the group’s forecasts in the context of the ongoing 
Brexit readiness plan and the potential impact of the Group’s 
delay in relocating staff to EU member states and, therefore, 
the loss of EU passporting rights.

Based on the work we have performed, we have not identified 
any material uncertainties relating to events or conditions that, 
individually or collectively, may cast significant doubt on the TP 
ICAP Group plc’s ability to continue as a going concern for a period 
of at least twelve months from when the financial statements are 
authorised for issue.

Our responsibilities and the responsibilities of the directors with 
respect to going concern are described in the relevant sections of 
this report.

5. Key audit matters
Key audit matters are those matters that, in our professional 
judgement, were of most significance in our audit of the financial 
statements of the current period and include the most significant 
assessed risks of material misstatement (whether or not due to fraud) 
that we identified. These matters included those which had the 
greatest effect on: the overall audit strategy, the allocation of resources 
in the audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of 
the financial statements as a whole, and in forming our 
opinion thereon, and we do not provide a separate opinion 
on these matters.

Annual Report and Accounts 2020
204

5.1. Accounting for the waiver from TP ICAP Limited 

Key audit matter 
description

The expenses of TP ICAP Group plc, primarily legal and management services fees incurred in relation to 
the formation of the entity and the external audit for the period, were paid by TP ICAP Limited (formerly 
TP ICAP plc).

In order to maintain the solvency of TP ICAP Group plc, TP ICAP Limited irrevocably waived their right to 
repayment of these expenses. As the TP ICAP Group plc was not a subsidiary of TP ICAP Limited at the 
balance sheet date, the waiver cannot be classified as a capital contribution in accordance with FRS 102. 
Management have accounted for the waiver of these expenses as other income.

Therefore, as set out on page 210, there is a significant accounting policy with respect to accounting for 
the waiver.
Supported by our in-house accounting specialists, we reviewed the terms of the waiver and management’s 
proposed accounting policy for compliance with FRS 102.

We considered the terms of the waiver and whether it had effect at the balance sheet date.

How the scope of our audit 
responded to the key 
audit matter

Key observations

Additionally, we tested the completeness of expenses recognised by TP ICAP Group plc and reviewed the 
waiver to ensure that all expenses incurred were covered by its terms.
We consider management’s accounting treatment to be reasonable. 

Our application of materiality
5.2. Materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of 
a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and 
in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Materiality
Basis for determining 
materiality
Rationale for the 
benchmark applied

£368 
3% of expenses

We have determined the account balance to have the most significant impact on the users of the financial 
statements to be expenses (excluding the external audit fee). This balance is the most significant in terms 
of quantum in the financial reporting period, therefore this is where the attention of the users of the 
entity’s financial statements is focused. 

5.3. Performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected 
misstatements exceed the materiality for the financial statements as a whole. Performance materiality was set at 70% of materiality for 
the 2020 audit. In determining performance materiality, we considered the following factors:

 > This entity is not a trading entity, but has been set up as an ultimate holding company; and
 > There is low volume of activity within the business, the transactions in the period consist of company formation costs and audit fees.

Error reporting threshold
We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £18, as well as differences 
below that threshold that, in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee on disclosure 
matters that we identified when assessing the overall presentation of the financial statements.

Annual Report and Accounts 2020
205

Independent Auditor’s Report to the members of TP ICAP Group PLC
continued

6. An overview of the scope of our audit
6.1. Scoping
Our audit was scoped by obtaining an understanding of the entity 
and its environment, including internal control, and assessing the 
risks of material misstatement. Audit work to respond to the risks 
of material misstatement was performed directly by the audit 
engagement team.

7. Other information
The other information comprises the information included in the 
TP ICAP Limited annual report and accounts, including the annual 
report of TP ICAP Group plc, but excludes the financial statements 
of TP ICAP Group plc and our auditor’s report thereon. The directors 
are responsible for the other information.

Our opinion on the financial statements does not cover the other 
information and we do not express any form of assurance 
conclusion thereon.

Our responsibility is to read the other information and, in doing so, 
consider whether the other information is materially inconsistent with 
the financial statements or our knowledge obtained in the course of 
the audit, or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material 
misstatements, we are required to determine whether this gives rise 
to a material misstatement in the financial statements themselves. 
If, based on the work we have performed, we conclude that there is 
a material misstatement of this other information, we are required 
to report that fact.

We have nothing to report in this regard.

8. Responsibilities of directors
As explained more fully in the statement of directors’ 
responsibilities, the directors are responsible for the preparation 
of the financial statements and for being satisfied that they give 
a true and fair view, and for such internal control as the directors 
determine is necessary to enable the preparation of financial 
statements that are free from material misstatement, whether due 
to fraud or error.

In preparing the financial statements, the directors are responsible 
for assessing TP ICAP Group plc’s ability to continue as a going 
concern, disclosing as applicable, matters related to going concern 
and using the going concern basis of accounting unless the directors 
either intend to liquidate TP ICAP Group plc or to cease operations, 
or have no realistic alternative but to do so.

9. Auditor’s responsibilities for the audit of the 
financial statements
Our objectives are to obtain reasonable assurance about whether 
the financial statements as a whole are free from material 
misstatement, whether due to fraud or error, and to issue an 
auditor’s report that includes our opinion. Reasonable assurance 
is a high level of assurance, but is not a guarantee that an audit 
conducted in accordance with ISAs (UK) will always detect 
a material misstatement when it exists. Misstatements can arise 
from fraud or error and are considered material if, individually or 
in the aggregate, they could reasonably be expected to influence 
the economic decisions of users taken on the basis of these 
financial statements.

A further description of our responsibilities for the audit of the 
financial statements is located on the FRC’s website at: 
www.frc.org.uk/auditorsresponsibilities. This description forms 
part of our auditor’s report.

10. Extent to which the audit was considered capable 
of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance 
with laws and regulations. We design procedures in line with our 
responsibilities, outlined above, to detect material misstatements in 
respect of irregularities, including fraud. The extent to which our 
procedures are capable of detecting irregularities, including fraud 
is detailed below.

10.1. Identifying and assessing potential risks related to 
irregularities
In identifying and assessing risks of material misstatement in 
respect of irregularities, including fraud and non-compliance with 
laws and regulations, we considered the following:

 > the nature of the industry and sector, control environment and 

business performance including the design of TP ICAP Group plc’s 
remuneration policies, key drivers for directors’ remuneration, 
bonus levels and performance targets;

 > results of our enquiries of management and those charged with 

governance about their own identification and assessment of the 
risks of irregularities; 

 > any matters we identified having obtained and reviewed TP 

ICAP Group plc’s documentation of their policies and procedures 
relating to:
 > identifying, evaluating and complying with laws and 

regulations and whether they were aware of any instances 
of non-compliance;

 > detecting and responding to the risks of fraud and whether they 

have knowledge of any actual, suspected or alleged fraud;
 > the internal controls established to mitigate risks of fraud or 

non-compliance with laws and regulations;

 > the matters discussed among the audit engagement team 

regarding how and where fraud might occur in the financial 
statements and any potential indicators of fraud.

Annual Report and Accounts 2020
206

As a result of these procedures, we considered the opportunities 
and incentives that may exist within the organisation for fraud.

Report on other legal and regulatory requirements

In common with all audits under ISAs (UK), we are also required 
to perform specific procedures to respond to the risk of 
management override.

11. Matters on which we are required to report by exception
11.1. Adequacy of explanations received and accounting records
Under the Companies (Jersey) Law, 1991 we are required to report 
to you if, in our opinion:

We also obtained an understanding of the legal and regulatory 
frameworks that TP ICAP Group plc operates in, focusing on 
provisions of those laws and regulations that had a direct effect 
on the determination of material amounts and disclosures in the 
financial statements. The key laws and regulations we considered 
in this context included the Companies (Jersey) Law, 1991, 
Listing Rules and tax legislation.

 > we have not received all the information and explanations we 

require for our audit; or

 > proper accounting records have not been kept, or proper returns 

adequate for our audit have not been received from branches not 
visited by us; or 

 > the financial statements are not in agreement with the 

accounting records and returns.

In addition, we considered provisions of other laws and regulations 
that do not have a direct effect on the financial statements but 
compliance with which may be fundamental to TP ICAP Group plc’s 
ability to operate or to avoid a material penalty. 

10.2. Audit response to risks identified
As a result of performing the above, we did not identify any 
key audit matters related to the potential risk of fraud or 
non-compliance with laws and regulations.

In addition to the above, our procedures to respond to risks 
identified included the following:

We have nothing to report in respect of these matters.

12. Use of our report
This report is made solely to TP ICAP Group plc’s members, as a 
body, in accordance with Article 113A of the Companies (Jersey) 
Law, 1991. Our audit work has been undertaken so that we might 
state to the TP ICAP Group plc’s members those matters we are 
required to state to them in an auditor’s report and for no other 
purpose. To the fullest extent permitted by law, we do not accept or 
assume responsibility to anyone other than TP ICAP Group plc and 
TP ICAP Group plc’s members as a body, for our audit work, for this 
report, or for the opinions we have formed.

Fiona Walker, FCA
For and on behalf of Deloitte LLP London, UK 
23 March 2021

 > reviewing the financial statement disclosures and testing to 

supporting documentation to assess compliance with provisions 
of relevant laws and regulations described as having a direct 
effect on the financial statements;

 > enquiring of management, those charged with governance and 
external legal counsel concerning actual and potential litigation 
and claims;

 > performing analytical procedures to identify any unusual or 
unexpected relationships that may indicate risks of material 
misstatement due to fraud;

 > reading minutes of meetings of those charged with governance 
and reviewing correspondence with the licensing authority; 
 > in addressing the risk of fraud through management override of 
controls, testing the appropriateness journal entries and other 
adjustments; assessing whether the judgements made in making 
accounting estimates are indicative of a potential bias; obtaining 
confirmations from external counsel to test that all expenses 
have been recorded; and evaluating the business rationale of any 
significant transactions that are unusual or outside the normal 
course of business.

We also communicated relevant identified laws and regulations 
and potential fraud risks to all engagement team members and 
remained alert to any indications of fraud or non-compliance with 
laws and regulations throughout the audit.

Annual Report and Accounts 2020
207

TP ICAP Group plc Income Statement
Period ended 31 December 2020

Administrative expenses
Other Operating Income
Profit before taxation
Taxation
Profit for the period

Notes
4

5

Period ended
31 Dec 2020
£
(24,274)
24,274
–
–
–

There were no items of other comprehensive income in the period other than the loss reported above and accordingly no Statement 
of Other Comprehensive Income is presented. 

Annual Report and Accounts 2020
208

TP ICAP Group plc Balance Sheet
As at 31 December 2020

Non-current assets
Investment in subsidiary

Current assets
Other debtors

Current liabilities
Deferred income
Net current assets
Net assets

Equity
Issued capital
Retained profits
Total equity

As at 
31 Dec 2020
£

Notes

6

7

8

9

–

709

(708)
1
1

1
–
1

TP ICAP Group plc made neither a profit or a loss in the current period.

The directors acknowledge their responsibility for complying with the requirements of the Act with respect to:
(a)  accounting records; and
(b)  the preparation of financial statements.

The accounts of TP ICAP Group plc (registered number 130617) were approved and authorised for issue by the board of directors on 
23 March 2021 and were signed on its behalf by:

R Stewart
Director
23 March 2021

Annual Report and Accounts 2020
209

Notes to the TP ICAP Group plc Financial Statements
For the period ended 31 December 2020

Note 1. General information and principal accounting policies 
General Information:
TP ICAP Group plc is a private company limited by shares, incorporated on 23 December 2019 in Jersey. The registered office is 
22 Grenville Street, St Helier, Jersey JE4 8PX Channel Islands.

The principal accounting policies adopted in the preparation of the financial statements are set out below. 

Going Concern basis
As set out in the Directors’ report, the directors have a reasonable expectation that TP ICAP Group plc has adequate resources to continue 
in existence for the foreseeable future. Accordingly, the going concern basis continues to be used in preparing these financial statements.

Basis of preparation
The financial statements are prepared under the historical cost convention and in accordance with applicable Jersey law and Financial 
Reporting Standard 102 (“FRS 102”) Section 1A Small Entities issued by the Financial Reporting Council. As permitted, TP ICAP Group plc 
has taken advantage of disclosure exemptions, including: Statement of Comprehensive Income, Statement of Changes in Equity, 
Statement of Income and Retained Earnings, and Statement of Cash Flows.

The financial statements are prepared in Pound sterling, which is the functional currency of  TP ICAP Group plc.

Issued capital 
Ordinary shares are classified as equity. 

Note 2. Significant accounting policies
The principal accounting policies adopted are:

(a)   Investments in subsidiaries are recorded at cost less impairment.
(b)   Income and expenses are recorded on an accruals basis. Administrative expenses of TP ICAP Group plc for the period and up to the 

date of the Scheme were settled by TP ICAP plc, a related party by virtue of common directorships. As TP ICAP plc was not a 
shareholder of TP ICAP Group plc, this has been recorded as other income in the Income Statement of TP ICAP Group plc. TP ICAP plc 
waived any right to repayment.
 Debtors are recognised at amortised cost less provision for impairment.

(c) 

Note 3. Key accounting judgements and sources of estimation uncertainty 
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the 
reported amounts in the financial statements. Management continually evaluates its judgements, estimates and assumptions in relation to 
assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical 
experience and on other various factors, including expectations of future events that management believes to be reasonable under 
the circumstances.

Note 4. Administrative expenses

External audit fees (inclusive of VAT)
Professional services
Other administrative fees

Note 5. Taxation
No tax was payable on the result for the period.

Note 6. Investment in subsidiary
TP ICAP Group plc holds one 1p share in TP ICAP Holdings Limited, a wholly owned subsidiary.

As at
31 Dec 2020
£
12,000
11,289
985
24,274

Annual Report and Accounts 2020
210

Note 7. Other debtors

Owed by shareholders on incorporation
Prepayment – related party

As at
31 Dec 2020
£
1
708
709

Prepayment relates to administrative expenses for January 2021 invoiced in the period to 31 December 2020 to which TP ICAP plc, 
a related party by virtue of common directorships, agreed to settle.

Note 8. Deferred income
Deferred income relates to administrative expenses for January 2021 invoiced in the period to 31 December 2020 to which TP ICAP plc, 
a related party by virtue of common directorships, agreed to settle.

Note 9. Equity – Issued capital 

Authorised share capital
20,000,000,000 ordinary shares of 25p
Issued share capital
2 ordinary shares of 25p

As at
31 Dec 2020
£

1

Note 10. Events after the balance sheet date
In December 2019, TP ICAP plc announced its intention to put in place a new Jersey-incorporated, United Kingdom tax resident parent 
company by means of a scheme of arrangement pursuant to Part 26 of the Companies Act 2006 of the United Kingdom (the “Scheme”). 

The Scheme became effective on 26 February 2021 and as a result TP ICAP Group plc became the new parent company of TP ICAP plc and 
the ultimate parent of TP ICAP plc and its subsidiaries.

In March 2021, TP ICAP plc transferred four subsidiaries to TP ICAP Group plc by way of distribution and sale. TP ICAP Group plc in turn 
transferred these subsidiaries to TP ICAP Holdings Limited. TP ICAP Group plc also received a cash dividend of £306m from TP ICAP plc. 
The Group will also complete the acquisition of Liquidnet Holdings Inc.

Note 11. Related party
TP ICAP plc is a related party of TP ICAP Group plc, by virtue of common directorships up to the date of the Scheme and subsequently as a 
wholly owned subsidiary. During the period ended 31 December 2020 and up to the date of the Scheme, TP ICAP plc settled administrative 
expenses of TP ICAP Group plc. This is disclosed in the Income Statement, Note 2 Significant accounting policies, Note 7 Other debtors and 
Note 8 Deferred income.

Annual Report and Accounts 2020
211

Glossary

Act
The Companies Act 2006

AGM
Annual General Meeting

ERMF
Enterprise Risk Management Framework

MTF
Multilateral Trading Facility

EU
European Union

NDF
Non-Deliverable Forwards

API
Applications Programme Interface

FCA
Financial Conduct Authority

OTC
Over the Counter

Board
The Board of Directors of TP ICAP Limited 
(previously TP ICAP plc)

BRC
Board Risk Committee

CAGR
Compound Annual Growth Rate

CAPM 
Capital Asset Pricing Model

FRC
Financial Reporting Council

FX
Foreign Exchange Currency

OTF
Organised Trading Facility

PBT 
Profit before Tax

Governance Manual
TP ICAP’s Group Governance Manual

Pillar 1
Minimum capital requirements under CRD IV

GRCCC
Group Risk, Culture and Conduct Committee

Pillar 3
Disclosure requirements under CRD IV

CCP
Central counterparty house clearing

Group
Until 25 February 2021 TP ICAP plc and all of 
its subsidiaries

PVM
PVM Oil Associates Ltd and its subsidiaries

CGU
Cash-Generating Unit

CLOB
Central Limit Order Books

HMRC
Her Majesty’s Revenue & Customs

HR
Human Resources

Code
The UK Corporate Governance Code 2018

IAS
International Accounting Standards

COEX
Coex Partners Limited and its subsidiaries

Company 
TP ICAP Limited (previously TP ICAP plc)

ICAP 
ICAP Global Broking and Information 
Business, acquired by TP ICAP plc on 30 
December 2016

RCF
Revolving Credit Facility

RCSA
Risk Control Self Assessment

RFQ
Request for Quotes

RoE
Return on Equity

SEF
Swap Execution Facility

COO
Chief Operating Officer

CRD IV
Capital Requirements Directive 

CREST
Certificateless Registry for Electronic Share 
Transfer

Deloitte
Deloitte LLP

DRIP
Dividend Reinvestment Plan

EBITDA
Earnings before interest, tax, depreciation 
and amortisation

EMEA
Europe, Middle East and Africa

EPS
Earnings per Share

Annual Report and Accounts 2020
212

IFRS
International Financial Reporting Standard

TPI
Tullett Prebon Information

IRS
Internal Revenue Service

TRACE
Anti-bribery compliance solutions

ISDA
International Swaps and Derivatives 
Association

KPI 
Key Performance Indicator

LIBOR
London Inter-Bank Offered Rate

LTIP
Long Term Incentive Plan

LTIS
Long Term Incentive Scheme

MiFID II 
Markets in Financial Instruments Directive

MOAB
Moab Oil Inc.

TSR
Total Shareholder Return

UK 
United Kingdom

US/USA 
United States of America

USD/US$
US Dollars

VAT
Value Added Tax

VIU
Value in use

Designed and produced by Gather
www.gather.london

Printed by Perivan

The Report was produced on paper that is Carbon Balanced & 
has been sourced from Sustainable Forests. Printing conforms to 
ISO14001 environmental standard using vegetable based inks.

TP ICAP Limited
Floor 2
155 Bishopsgate
London
EC2M 3TQ
United Kingdom

www.tpicap.com