Trading platforms set for consolidation says London Capital Group

March 25 (Reuters) - Trading platforms targeting small individual investors face a wave of consolidation as regulators insist they hold more capital and impose more rules on them, the head of brokerage London Capital Group said on Wednesday.

Speaking after results which showed his company moving back towards profit after changes last year which saw it replace around 75 percent of staff, Charles-Henri Sabet outlined a strategy which will focus it more on currencies, open offices in Europe and invest in infrastructure and further hires.

The company, listed on London's small cap AIM market, was one of several in the sector to register losses from the Swiss franc's record-breaking surge on Jan. 15 and that, plus a growing regulatory burden is prompting many to take a hard look at their business models.

"I think there will be a big big consolidation in this industry," Sabet said. "The small people will disappear first of all. I think in 3-4 years we need to be one of the top players in the industry or we will not be here anymore."

London Capital Group (LCG) said it lost 1.7 million pounds ($2.5 million) on the franc trade, but a number of the sector's biggest players lost much more.

Alpari UK sank into administration while Danish-based Saxo Bank estimated earlier this month that it lost $100 million from the franc volatility. Saxo's main competitor FXCM (NYSE: FXCM - news) had to take an emergency loan at high interest after losses of $200 million.

Sabet, who has taken over as CEO from his previous role as executive chairman, said he had taken senior staff from both FXCM and Saxo in a restructuring that will last until the end of 2016.

He also said the scale of the industry's focus on Cyprus - where many brokers have been drawn to for regulatory and cost reasons - was set to change.

"There are too many people in the industry so it is a bubble," he said. "Cyprus was a good idea but 200 brokers in Cyprus was not."

On LCG's own results and plans, Sabet said:

"The final result is still negative, as we had a lot of balance sheet cleaning. (But) even with the high weight of redundancies and restructuring costs, we ended the year with a positive EBITDA figure," he said. "A strategy is now in place for the Group to return to long-term sustainable growth at all levels of the business during the second half of 2015." ($1 = 0.6726 pounds) (Writing by Patrick Graham; Editing by Elaine Hardcastle)