Galen Stops takes a look at how Atlas Bank is taking a new approach to prime banking and clearing processing in Latin America’s FX markets. Atlas has been around for quite some time now, and in fact has a long history in the FX industry. The group initially formed in 1994 with the launch of […]
Tag: prime services
Atlas Bank has been granted a BBB- rating and a stable outlook by Equilibrium, an affiliate of Moody’s Investors Service that provides credit rating services in Latin America. The bank claims that this makes it the first bank in Latin America providing clearing and settlement services to have obtained such a credit rating, which it […]
On a panel discussion entitled “The Twists and Turns of FXPB”, speakers at Profit & Loss Forex Network Chicago discussed the possibility for technology to radically re-shape the prime services ecosystem.
Technology’s impact on prime services was the jumping off point for the last panel at Profit & Loss Forex Network Chicago. Peter Plester, head of prime brokerage at Saxo Bank A/S highlighted the impact that technology had already in terms of risk management in this segment pointing out that the traditional plumbing for starting up a prime broker was to connect to NEX Traiana and the various ECNs and have STP for tickets, but that the central risk system internal to the PB was fairly manual.
Marcus Butt, global head of FX prime services and futures at NatWest Markets, talks about how the bank is developing its FX Prime Brokerage offering in response to changing client needs.
Profit & Loss: So what are you doing on the FXPB side of your e-FX platform that you think differentiates your offering right now?
Marcus Butt: What we’re doing on the platform that is unique is really a reflection of what we’re doing in the business. Part of this is that we’ve introduced a number of new prime brokerage models to accommodate the diversification of our client base.
Raj Sitlani, co-founder of IS Prime and managing director of ISAM Capital Markets, sat down with Profit & Loss in Shanghai to talk about the challenges associated with expanding into Asian FX markets and why technology remains the key differentiator for prime-of-primes.
Profit & Loss: So what’s your business focus in Asia?
Raj Sitlani: We have a large market share in Australia but, until recently, never truly had the manpower or the resources to crack the broader Asia market. However, there’s a very big opportunity in the region for us to provide our flagship product – which is a prime-of-prime service with aggregated FX liquidity – and so last year we set up a Hong Kong office through which we can build out our presence in North Asia and China.
The announcement by BNY Mellon this week that it is launching an FX prime brokerage (FXPB) service is interesting for a couple of reasons.
Superficially, it bucks a trend that has developed in recent years of banks scaling back, or even shutting down, their FXPB businesses. However, Profit & Loss already argued in a special report looking at prime services published in Q3 2017, that this trend was beginning to reverse itself.
So perhaps more significant is that it indicates that the barriers to entry in FXPB have been lowered as the cost of technology and infrastructure has both decreased and become more available.
Saxo Bank has launched a new, full amount execution infrastructure for its prime-of-prime (PoP) service.
Running on dedicated infrastructure through the firm’s direct market access (DMA) liquidity hubs in London and New York, Saxo says the full amount execution capability provides lower market impact for large orders in FX and precious metals.
Demand has been driven by growth in small- to mid-sized institutional clients looking for direct market access and liquidity optimisation services.
Lucian Lauerman, global head of electronic distribution, comments: “We have grown our prime-of-prime business quite significantly and we are meeting increasing client demand for execution in large order sizes. To support efficient execution and sustainable liquidity access, we have set up a dedicated infrastructure allowing clients to execute in full amount through liquidity connectivity in both NY4 and LD4. This offers clients better pricing and lower market impact on larger tickets.”
BNY Mellon is launching an FX prime brokerage service for its institutional clients.
The custodian bank announced in a release today that the new service will launch “in early 2018”.
In the release, BNY Mellon says the service will allow institutional clients to access a significant new source of FX liquidity while helping streamline and reduce operational expenses, including legal and onboarding costs, as well as generating substantial capital and netting gains.
Users of the service will be able to transact a suite of FX products while also having access to pre- and post-trade services in addition to BNY Mellon’s collateral, funding and liquidity capabilities.
Galen Stops speaks to market sources about the feasibility of splitting prime services into credit provision and trade processing.
Capitolis is the latest venture headed by Gil Mandelzis, the former EBS BrokerTec and Traiana CEO. Mandelzis co-founded the company along with his former Icap and Traiana colleague, Igor Teleshevsky, and former Thomson Reuters CEO, Tom Glocer in New York earlier this year. Mandelzis operates as CEO of the firm, Teleshevsky is VP of R&D and Glocer is listed as an executive chairman.
Galen Stops explains how OTCXN is applying blockchain technology to help firms access wholesale liquidity.
OTCXN seeks to leverage its own proprietary blockchain technology to solve what its CEO and founder, Rosario Ingargiola, says is currently the biggest challenge in the FX market: accessing wholesale liquidity.
This challenge is caused by a credit gap in the market, according to Ingargiola, that has in turn occurred because the banks have been broadly reducing the number of firms that they are willing to extend credit to.