CMC held £1.15bn of segregated client money outside its balance sheet—more than four times group cash

CMC Markets ended its 2026 financial year with £1.1491 billion of segregated client money that did not appear as an asset on the group balance sheet. That pool was 4.16 times the group’s £276.5 million of recognised cash and cash equivalents. The distinction is more than an accounting footnote: one total belonged economically to customers and was held under safeguarding rules; the other was corporate liquidity available to the group, subject to its obligations. Adding the figures together would overstate the cash CMC could deploy. Looking only at the balance sheet would understate the amount of customer money passing through the platform.[1][2]

The gap widened sharply during the year. Segregated client money increased by £454.2 million, or 65.4%, from £694.9 million. Group cash rose by £28.9 million, or 11.7%, from £247.7 million. Both movements may reflect a larger business, but they describe different claims and different risk perimeters. The first is a custody and reconciliation responsibility. The second contributes to the group’s own funding capacity. A broker can therefore report modest corporate-cash growth while administering a much larger increase in customer cash outside its statement of financial position.[1]

Two cash totals with different owners

CMC’s annual report explicitly says segregated client funds are not included in the group’s assets. Its UK regulatory page explains the operating reason: retail client money is kept in segregated accounts at banks including NatWest, Barclays and Lloyds and is not lodged as margin with CMC’s hedging counterparties. The company says it performs daily client-money calculations and reconciliations and submits a monthly Client Money and Asset Return to the Financial Conduct Authority. It also says some client money may be placed in term or notice deposits lasting up to 95 days. Safeguarding therefore does not mean every pound sits overnight in an instantly accessible current account; it means the money is identified and managed within the client-money regime rather than treated as CMC’s own property.[1][2]

The annual report also records £239.0 million of client payables and £105.6 million of stockbroking creditors on the balance sheet. Those liabilities should not be relabelled as the segregated-money pool. Client payables more than doubled, while stockbroking creditors increased by about 6%. The different rates of change reinforce that the captions follow different accounting and operational mechanisms. A customer deposit can be safeguarded off balance sheet, while other amounts due to customers may be recognised as liabilities because of the legal arrangement, product, settlement stage or client classification. The public accounts do not provide enough detail to map every pound of the client-payables line to a particular contract.[1]

Professional arrangements create another boundary

CMC’s regulatory disclosure says certain professional clients may transfer title to money under a title-transfer collateral arrangement. In that case, the money is not protected in the same manner as retail client money and the client becomes a general creditor for the transferred amount. That statement establishes that CMC operates more than one client-money perimeter. It does not establish that all, or even most, of the £239.0 million client-payables balance arose from title-transfer arrangements. Making that leap would confuse a disclosed legal possibility with a quantified accounting composition. The annual report would need a more granular note, or the company would need to provide a reconciliation, before the two could be connected reliably.[1][2]

For customers, the practical question is not simply whether a broker displays a cash balance. It is which legal entity owes or safeguards that balance, whether the customer is retail or professional, whether title has transferred, and whether money is awaiting settlement. Those conditions determine whether the customer has a proprietary claim to segregated money or an unsecured contractual claim against the firm. The group brand cannot answer that question on its own. CMC’s own page directs customers to the terms that apply to their account, which is the correct place to identify the relevant treatment.[2]

The income line cannot be turned into a yield

CMC reported £23.4 million of income on client funds for the year, down 4.8% from £24.6 million even though the year-end segregated balance rose substantially. It would be tempting to divide the income by the £1.1491 billion closing balance and call the result a return. That calculation would be unsound. The income covers a full year; the disclosed client-money figure is a single point at 31 March. The average balance, the dates of inflows, the currencies, the mix of overnight and term deposits, and any amounts on which interest was passed to customers are not disclosed in the same table. A valid yield would require a time-weighted average denominator and a matched revenue perimeter.[1][2]

The divergence nevertheless tells readers something useful. A large closing client-money balance does not automatically produce proportionately higher annual income, because the balance may have arrived late, interest rates may have changed, currencies may have earned different rates, or the product mix may have shifted. It also prevents a second error: treating the £23.4 million as proof that CMC kept all interest generated on every safeguarded account. The published number is a group revenue category. It is not a complete cash-flow bridge between each client account, each bank placement and each customer interest payment.[1]

Why the off-balance-sheet number matters

The £1.1491 billion figure matters in three directions. For liquidity analysis, it is a warning not to count client property as available corporate cash. For operational-risk analysis, it shows the scale of money that must be reconciled accurately across client ledgers and bank accounts. For customer-protection analysis, it focuses attention on the banks, maturities, legal entities and contractual exceptions behind the headline balance. Segregation is designed to separate customer money from the firm’s creditors, but it does not make bank exposure, reconciliation failures or insolvency administration disappear. CMC’s use of several named banks and its daily reconciliation process address parts of that risk chain without turning it into a guarantee against every loss or delay.[1][2]

The reported growth could have several benign explanations: stronger net deposits, higher market values moving through settlement, acquisition effects, a larger stockbroking base, or customers holding more cash while waiting to invest. The annual report does not isolate a single cause in the off-balance-sheet note. A conclusion that the increase signals customer stress, or that it proves exceptional new-client growth, would therefore outrun the evidence. The defensible finding is narrower and more consequential: CMC’s administered customer-cash pool expanded far faster than its recognised cash, and the two numbers cannot be combined or compared as though they were under the same ownership.[1][3]

The disclosure that would complete the picture

A fuller account would provide average segregated balances by quarter, the share placed in notice deposits, the principal currencies, the interest paid to customers, the income retained by the group and a bridge between safeguarded money and recognised client liabilities. It would also distinguish retail segregation from professional title-transfer balances. None of those additions would change the legal principle, but they would allow investors and customers to test concentration, duration and economics rather than infer them from closing balances.[1][2]

Until then, the most accurate reading is deliberately two-column. CMC had £276.5 million of group cash at 31 March 2026. Separately, it safeguarded £1.1491 billion of client money outside its balance sheet. The first belongs in an assessment of corporate liquidity. The second belongs in an assessment of custody, reconciliation and customer claims. The scale of the second number makes the distinction impossible to treat as technical bookkeeping.[1][2]

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