Capital Spreads owner London Capital (LCG) has suffered another blow as Irish bookmaker Paddy Power has dropped it as a partner and pulled out of financial spread betting altogether.Paddypowertrader represents 17% of active clients of LCG. Paddy Power warned LCG it was reviewing its financial spread betting business at the start of March. "Further to the statement made on Tuesday 1st March, London Capital Group has been informed by Paddy Power that following the review of their financial spread betting business they intend to terminate their LCG operated White Label contract and will be exiting the financial spread betting space," LCG said. "LCG and Paddy Power are now in negotiations to agree a mutually beneficial termination agreement. PaddyPowerTrader customers will be invited to transfer to LCG's Capital Spreads brand at a date to be agreed," the statement added.Its withdrawal comes just weeks after LCG was forced to postpone its annual results after after the Financial Ombudsman Service told it to repay £100,000 to a client who lost the money in a third-party currency fund sold on the Capital Spreads platform.After the ruling, LCG said it could face a total payout of up to £7.7m and had to postpone its full-year results because of uncertainty over what level of provision to take. It added then it expects the final payout to be much less than the £7.7m figure.