There was increasing concern for the future of broker Daniel Stewart today as it said it was no longer taking on new clients after two years of mounting losses, sources close to the company said.
It is understood that scores of staff at the firm were made redundant at a meeting yesterday afternoon after Epsilon Investments, a Singaporean investment firm who had financially backed the broker, decided to pull the plug.
“They were sick of pumping money in for no returns,” one source said.
Epsilon Investments also has a stake in rival Novum Secruites.
Daniel Stewart’s website only carries a holding statement which says: “Please be aware that as a result of internal restructuring Daniel Stewart & Company will not be accepting any new client instructions for the foreseeable future.”
Daniel Stewart employs around 20 staff, many of whom are now looking for new jobs.
The firm has been letting senior staff go since the turn of the year and its latest results show it posted a £1.2 million loss for 2018, widening from a £879,029 loss in 2017.
Daniel Stewart has a number of small-cap clients including Israeli diamond miner Shefa Yamim and oil and gas company Zenith Energy.
City brokers have been struggling to survive in the wake of Mifid II regulation, ramping up trading costs for the smaller houses.
Many brokers have already merged or are looking to merge. Late last year broker SP Angel said it would merge with rival Northland Capital Partners, while there are rumours that Panmure Gordon and Zeus Capital have held talks about a tie-up.
Meanwhile Liberum and Peel Hunt are believed to have attracted attention from overseas.
Daniel Stewart bosses could not be reached for comment.
