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State Street Acquires BestX State Street has acquired BestX, a software company that provides independent trade technology and TCA analytics. The financial terms of the deal, which is expected to close in Q3 subject to closing conditions and regulatory approval, are not being disclosed. Following the deal, BestX will sit within State Street’s Global Link product suite, which is run by Martine Bond, executive vice president and head of trading and clearing for State Street Global Markets. “Over the past few years, Mifid II, combined with broader economic and political stresses in the market and great competition in the FX market, has meant that our clients are looking for greater transparency and ways to improve their performance and their returns to client and shareholders,” says Bond
EC Levels FX Charges Against Credit Suisse Credit Suisse has revealed in its Q2 financial report that the European Commission (EC) is alleging that the bank engaged in anti-competitive practices relating to its FX business. “On July 26, 2018, Credit Suisse Group AG and certain affiliates received a Statement of Objections from the European Commission (Commission), alleging that Credit Suisse engaged in anti-competitive practices in connection with its foreign exchange trading business. The Statement of Objections sets out the Commission’s preliminary views and does not prejudge the final outcome of its investigation,” the report states. A spokesperson for Credit Suisse declines to comment on the news.
Banerjee Ruling Leaves RBC Looking at a Big Bill? The judge’s summary in the unfair dismissal case in which John Banerjee won his claim against Royal Bank of Canada has been published by a London employment tribunal and could see the bank facing a large compensation bill. Rarely in such cases, Banerjee’s claim for whistleblower status was not dismissed, with Employment Judge James Tayler finding that he was unfairly dismissed principally for “the making of a protected disclosure”. In the ruling, Judge Tayler refers to an address, in which staff were encouraged to report wrongdoing, and were told “don’t ask don’t tell will not be tolerated”.
State Street Buys Charles River State Street Corporation has entered into a definitive agreement to acquire Charles River Systems a provider of investment management front office tools and solutions, for $2.6 billion. The acquisition, which is subject to regulatory approvals and customary closing conditions, is expected to be completed in the fourth quarter of 2018. State Street says that the integrated systems will enable it to deliver “a global front-to-back platform for asset managers and asset owners that will be unique in the investment servicing industry”.
ASIC “Disappointed” in Lack of Progress in NAB FX Reform The Australian Securities and Investments Commission (ASIC) has expressed disappointment at the failure of National Australia Bank to fully implement a reform programme linked to an Enforceable Undertaking (EU) levied by ASIC after deficiencies were found in the bank's wholesale spot FX business. NAB, along with the other major Australian banks, were fined by ASIC in December 2016 for a series of failures in their FX businesses, including attempts at front running orders, manipulating fixes and inappropriately sharing confidential information.
BNY Mellon Launches FX Options Trading BNY Mellon has launched its FX options desk, enabling clients to better hedge currency exposure and express their views on the future direction of FX markets. The bank says that clients now have access to a full-service currency trading desk, offering spot, forwards, non-deliverable forwards as well as options. “This offering complements an existing suite of broader FX services including FX custody, payments and hedging,” it adds. Options represent the latest step in a broad build out of BNY Mellon’s FX business – the bank has made a series of senior hires over the past two years and in January announced plans to launch an FX prime brokerage service.
CFTC Fines JP Morgan Over ISDAFix The US Commodity Futures Trading Commission has issued an Order simultaneously filing and settling charges against JP Morgan for what it says was the attempted manipulation and "muscling" of the US dollar ISDAFix 11am benchmark including the submitting of false rates. The order also requires the bank to pay a $65 million civil monetary penalty and is related to actions undertaken by certain of its traders over a five-year period, beginning in at least January 2007 and continuing through January 2012.
Societe Generale Hit with $750m LIBOR, Euribor Fines The Commodity Futures Trading Commission (CFTC) has fined Societe Generale (SocGen) $475 million, and the US Department of Justice (DOJ) another $275 million, for attempted manipulation of and false reporting in connection with the London Interbank Offered Rate (LIBOR) and Euro Interbank Offered Rate (Euribor). More specifically, the CFTC accused the French bank of attempted manipulation of and false reporting in connection with the LIBOR for US Dollar, Yen and Euro, and the Euribor, certain instances of manipulation of Yen LIBOR, and aiding and abetting traders at another bank in their attempts to manipulate Euribor. This misconduct apparently spanned more than six years, from 2006 through mid-2012.
CLS Volumes Down in April, Up YoY The average daily volume (ADV) of trades submitted to CLS was $1.78 trillion in April, down 4.2% from March 2018, but up 17.2% year-on-year. The ADV of swaps submitted to CLS was $1.24 trillion last month, down 2.3% from March, but up 25.5% compared to April 2017. The spot ADV was $433 billion in April, down 9.8% month-on-month, but almost flat compared to the $435 billion of ADV that it registered the same month last year. Forwards were the only product type where the ADV of trades submitted to CLS grew last month. The $106 billion of ADV for forwards registered in April was a 2.9% increase from March and up 14% compared to April 2017.
Societe Generale Partners with BestX Societe Generale Corporate & Investment Banking (SG CIB) has announced a partnership with BestX, an independent transaction cost analysis (TCA) provider for algo FX spot execution. The partnership with BestX will enable SG CIB clients to assess the costs and execution performance of their FX transactions through an analytical framework, the bank says. In addition, clients will be able access to a unique set of analytics, which will measure many aspects of execution performance, including spread and impact costs and signalling risk.