Head of investment company “freedom Finance” Timur Turlov told about listing on NASDAQ, the complexity of the procedures that preceded it, and what business opportunities this opens up.
Listing on NASDAQ is the beginning of public history. Why is it necessary? And, frankly, is for the Russian company is now an exceptional phenomenon. Timur Turlov: You are right. We are the first Russian broker and the first investment Bank that went public in the United States, including because of the regulatory requirements in America has tightened lately. Publicity requires full disclosure: procedures of financial audit, control, information about the origin of the funds, the shareholders, the reputational risks associated with all people connected with the company. It was our very old dream that we are more than five years went. For us, the fact of listing on the NASDAQ successful completion of all procedures — a kind of quality mark, which we received as recognition of the high standards of professionalism of our team. This suggests that we are very market, retail business as the regulator has used to see from the point of view of transparency and all the rest. It seems to me that the listing will offer us many opportunities. What are the possibilities? We have pillars of market with almost thirty years of history, such as BCS, Finam, which has experienced all the unpleasant and difficult moments, but they don’t. Timur Turlov: We have worked with clients in the U.S. stock market and why it happened that have developed a considerable expertise in working with American investment banks in public offerings in the United States. We understood the industry from the inside, and we certainly had a dream — to gain access to this market, to access to the American capital, to be able to raise money for their activities. That is the goal — access to capital? Timur Turlov: Is access to capital, on the one hand, and on the other hand, the ability to get a good grade in the interests of our shareholders and also this good reputation the history. We were able, we meet the highest standards of corporate governance and transparency. Reputation is clear. But still, the access of capital: why financial investment company access capital? Timur Turlov: We went to the American investor with a simple story. In Russia, quite rapidly began to grow penetration of brokerage services. As you know, on the Moscow exchange over the past 18 months, it was discovered about a million new accounts, despite the fact that for all the time they only break three million. We have already started quite the explosive growth of penetration. Only in the former Soviet Union, mainly in Russia, only about 2% of household assets represent investments in securities. In Turkey is 15%, in Germany 38%, in the United States — 78%. USA ahead of the rest by this measure, no one more not yet caught up. And to catch up with Turkey is absolutely real, believe in all this. You want to say that the stock market in Russia on the threshold of explosive growth? Timur Turlov: Exactly. We not only expected a great potential, we see that this potential has already begun to unfold. And mass investor market comes. Now comes growing revenues. That is, you need investment in order to expand their presence, expand staff, expand services, expand technology? Timur Turlov: Yes, we need to continue to invest in our infrastructure. We see the potential for bargains for mergers, acquisitions, and not only in Russia. We need capital in order to comply with certain regulatory provisions. We plan to Finance the capitalization of our Bank, which is included in the group. In General, the fact that we have about $ 130 million of equity capital according to the latest reports, it is easier for us to participate in some local primary placements, which we arrange on the Moscow exchange, or Kazakhstan, or Uzbekistan, where they implement projects. We invest in its network in its technology. And one of the key ideas for which you need capital, is to buy some other players. This way you can get a real synergy for our business and potentially scale it where it is economically feasible. Tell me, how you felt when you were listing and you applied for the exchange of all these documents a special approach, as the American company registration, but the Russian center of vital interests? Timur Turlov: Yes, we were probably triple control of everything that happened. Auditors we spend five months of the year. American auditors are in Russia, in Kazakhstan, in those centers in which we have a lot of client operations. We are still the largest broker in Kazakhstan: we have 12 branches. Of course, auditors we are checked there is very high quality, and then checked by our auditors on how they tested us, so we got really triple control and triple disclosure is not only holding but for all that, in principle, to do with me, with all companies around the holding. It seems to me that we “turned out all the pockets.” Once again I want to ask, but it’s worth it? Why, then, not to stay in America, and even in Hong Kong, at least in London, I’m not even talking about Moscow or St. Petersburg? Timur Turlov: Yes, it’s worth it, because with our volume of business we understand that everything that gives us access to a large number of clients and to the real growth of our business, which will justify the expenditure on publicity. In America costs are the highest, but in America and the most important capital market, the role of which has increased since the last time. It increases its share of all of the last 10 years. Our customers used to buy American history. And of course, we wanted to offer them and show that we are part of the story.
Shares of the company “freedom Finance” under the Ticker FRHC October 15, 2019 are traded on one of the world’s largest stock exchanges NASDAQ, which presents well-known hi-tech companies Apple, Amazon, Facebook, Microsoft, Google and others.
Up to this point, leading us on the site just traded six of the largest Russian issuers. In addition, this is the first time in history, when listing on NASDAQ received Russian investment (broker) company.
Listing rules on the NASDAQ — one of the toughest among world stock exchanges. The exchange imposes high requirements on reporting financial results and liquidity, corporate governance and business transparency.
The company “freedom Finance” is Freedom Holding Corp. as an international financial holding company registered in Nevada, USA. Freedom Holding Corp. today also includes the Bank “freedom Finance”, the Kazakh broker of JSC “freedom Finance”, the Ukrainian company “freedom Finance Ukraine”, Freedom Finance Cyprus Limited, Freedom Finance Germany GmbH TT., Company “freedom Finance” (Uzbekistan). The holding’s capitalization as of end of September is approximately $ 700 million, equity capital of the group exceeds $ 125 million, with net assets of $ 429 million and client assets of $ 1.3 billion. The total number of customer accounts over 121 thousand. The holding consists of 78 offices in the States of presence.
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