Interactive Brokers Group Strength and Security


Strength and Security


Financial Strength

When placing your money with a broker, you need to make sure your broker is secure and can endure through good and bad times. The financial statements of Interactive Brokers LLC are available on our website for your review.

Note that Interactive Brokers LLC and its affiliates are owned by IBG LLC.




Important Strength and Security Facts about Interactive Brokers Group1


  • On a consolidated basis, Interactive Brokers Group (IBG LLC) exceeds $7 billion in equity capital.
  • IBG LLC's owners are our public company, Interactive Brokers Group, Inc. (18.1%) and the firm's employees and their affiliates (81.9%). Unlike at most other firms, where management owns a relatively small share, we participate substantially in the downside just as much as in the upside. Because of this vested interest, we run our business conservatively.
  • We manage our brokerage and market making businesses in separate companies, which are registered with local securities and/or commodities regulators. We maintain strict systematic and procedural separation between the two business lines and we do not commingle or utilize customer-segregated assets for proprietary operations. Although certain affiliates of IBKR trade for their own account, our customer-facing businesses do not conduct proprietary trading. We have completed the winding down of the bulk of our market making operations.
  • We hold no material positions in over-the-counter securities or derivatives. We hold no CDOs, MBS or CDS.
  • Our positions are marked to market daily and the resulting payables/receivables are reconciled to outside sources automatically.
  • Our real-time margining system marks all customer positions to market continuously. All orders are credit vetted before being executed and positions in accounts with inadequate margin deposits are liquidated automatically.
  • IBG LLC reported $1.2 billion of pretax profit for 2018.
  • IBG LLC have no long-term debt.
  • Interactive Brokers LLC is rated 'BBB+'; Outlook Positive by Standard & Poor's

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How We Handle Customer Assets


Client money is segregated in special bank accounts (Client Money Accounts held in Trust with Authorised Deposit-taking Institutions ("ADI")) which are designated for the exclusive benefit of Australian customers of IBKR. This segregation is a requirement of Australian Financial Services License ("AFSL") holders and, Interactive Brokers Australia ("IB Australia"), as an AFSL holder, fully complies with these principles.

By properly segregating the customer's assets, if no money or stock is borrowed and no futures positions are held by the customer, then the customer's assets are available to be returned to the customer in the event of a default by or bankruptcy of the broker.

Client money is NOT invested by IB Australia, and is at all times held in these Client Money Accounts held in Trust. In addition, IB Australia does NOT hold any excess amount of its own money in these Client Money Accounts held in Trust.




Securities accounts with margin loans


For customers who borrow money from IBKR to purchase securities, IBKR is permitted by securities regulations to utilize for financing purposes up to 140% of the loan value of the stock these customers hold with IBKR. In simple terms, IBKR borrows money from a third party (such as a bank or broker-dealer), using the customer's margin stock as collateral, and it lends those funds to the customer to finance the customer's margin purchases. Typically, IBKR lends out a small portion of the total stock it is permitted to lend out. When IBKR lends customers' stock, it must put additional money into the special reserve accounts set aside for the benefit of customers.


Disclosure
  1. All numbers reported as of December 31, 2018.