Aas is back
Infamous Norwegian power trader Einar Aas
has returned to the Nordic power sector as
an analyst with a boutique trading firm in
southern Norway, though the market is still
counting the cost of his multi-million euro
default less than two years ago.
By Olav Vilnes and Gert Ove Mollestad » [email protected]
“We can confirm that Einar Aas has been appointed as analyst at
Branden Forvaltning since 1 January. He will not execute any trading
activities,” the firm’s chairman, Aasmund Haugsvaer, tells Montel.“It
is obvious that he has something to offer us on analysis,” adds the
chairman.
Aas had been the single most successful power trader in the Nordic
market for years. But in September 2018, the Nasdaq exchange put
his portfolio into administration for failing to come up with enough
collateral on a massive bet he had placed on the spread between Nordic
and German power prices.
The subsequent default blew a EUR 114m hole in Nasdaq Clearing’s
default fund and had massive repercussions for market liquidity in the
following months.
In the wake of the default, Nasdaq introduced measures including a
capital collateral requirement of at least EUR 5m for all direct members,
while requiring their maximum exposure to be of half of available
liquidity reserves, including credit lines and collateral.“Over time this
will clearly see fewer participants on the exchange. The cost has simply
become too high,” says Hermund Ulstein, president of the Nordic
Association of Electricity Traders.
In 2019, Nordic financial power volumes traded and cleared on the
Nasdaq Commodities exchange plunged nearly 14.5% year on year to
814.2 TWh, their lowest level since 1998.
Norway’s financial services regulator criticised Nasdaq routines
prior to the default in a report on the incident released in January,
though market players are still awaiting a final report from the
authorities in Sweden over Nasdaq clearing’s role.
Aas traded in the Nordic market on his own account from 2005 to
2018, largely to avoid public scrutiny of his finances, and before that he
worked at Interkraft Trading in Arendal, a town in southern Norway.
He also became a direct member of Nasdaq in 2005, which is highly
irregular for an individual and no longer possible following his default
in September 2018.
Aas had strong links to his current employer Branden previously,
with the report from Norway’s financial watchdog highlighting the fact
he had authorised two of the firm’s power traders to trade on his behalf.
The trader was Norway’s top earner in 2013 posting an income of
NOK 313m (EUR 32m) before tax, which rose to NOK 833m by 2016.
He invested much of the money in luxury properties in Norway and
abroad.
Before the default, he enjoyed near legendary status in Norway’s
trading community and was considered knowledgeable, thorough albeit
willing to take large risks. Aas is media shy, never granting interviews
or allowing himself to be photographed. Norwegian media largely use
pictures taken during his time at Norway’s School of Economics (NHH),
where he graduated in 1994, only serving to heighten his mystique. n
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Montel Magazine 1–2020