REGIONAL e-FX PERSPECTIVE
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will offer multi-asset execution; however, our focus remains on producing quality research to assist clients in determining timing for best execution.”
While Spiropoulos notes that bank lending syndicates have been ‘re-priced’ and in many cases expanded since 2008, He comments: “Tis has led to increased competition for ancillary business, especially FX, which typically all banks offer. Changes in accounting rules have made it cumbersome to get hedge accounting treatment for derivatives. Companies in the energy industry are primarily using mark-to- market accounting due to the volume and types of hedging instruments. We see increased interest in structured products as companies want more flexibility and tailored solutions.”
“Te traditional role of information provider by the sales desk will still be utilised in the future, and it is becoming even more important to deploy tools that free up their time to concentrate on servicing the client needs. At CIBC, internal deployment of e-commerce systems provide sales desks in various geographical locations with access to streaming executable prices for spot, forwards and swaps. Tese systems enable marketers to respond quickly to client price requests, trade and book deals electronically and route the risk to the appropriate trading book for risk management. Straight through processing and further automation of post-trade services, such as give-ups, result in increased efficiency and capacity to deal with large volumes,” states Spiropoulos.
Playing catch-up
With regard to electronic FX business, Canadian banks were largely well behind the curve when compared to the larger tier one global players. Major technological advancement has been experienced in the
FX marketplace over the past five to eight years and Canadian banks have simply been late to the game. Tis has undoubtedly been driven in part by the buy side which had not been demanding better electronic FX solutions, though this has definitely changed recently.
“All the Canadian banks appear to be playing catch up with the global competition with varying levels of commitment, focus and success,” comments Gavsie. “BMO has committed considerable resources to ensure we are able to provide clients with automated dealing capabilities that meet their needs. We are delivering solutions that address client needs, this includes differing platforms by client segment and post-trade functionality that is not widely available from other banks.”
“At BMO our cash management and FX businesses are closely aligned. Client feedback is regularly shared across both product groups and this helps us to continuously develop new solutions. We have provided clients with access to both electronic FX and cash management services online for many years, well before many of our local competitors, and we are always looking to improve them. In fact, our services have recently been revamped through our new Online Banking for Business platform, which integrates our FX and cash management operations, making it easier for our clients to do their transactions in one place, with developments in line to pull in more capabilities in the future. Tese and future innovations are 100% driven by our clients’ business needs. Ease of use for the client is really where we should all be headed,” contends Gavsie.
Generally speaking, claims Savoy, most of the major Canadian banks, including RBC, continue to increase their electronic FX distribution through better and faster pricing, low latency execution systems, STP tools and auto pricing. “Tese are all key components which have made RBC much more competitive in the global marketplace, and specifically within Canada,” he says.
While Spiropoulos states: “Te customised workflows we have implemented in our FXOnline
66 | october 2011 e-FOREX
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