This article was written by Adinah Brown from Leverate.
Over the past 12 months, the retail forex trading market has undergone a rapid evolution in the form of regulation enhancement that has come in the wake of increased market competition. The unexpected beneficiaries of these developments are established high street banks who have seized a ripe opportunity to extend their array of financial offerings.
Stringent regulation demands put a vast number of small brokerages under significant pressures that in many cases have forced them into closure as their existing business models were no longer profitable. In their place, a far more limited number of high street banks were in a position to pick up these now displaced traders.
The banking industry is not without its own challenges, but these challenges became driving forces motivating banks to start looking beyond their established horizons. New forms of competition, particularly in relation to increased availability of online services, non-banking financial apps and historically low interest rates have become a ruthless combination which has forced banks to cut their fees all whilst their profit margins are at profound lows.
The solution found by many established banks has been a move into their industry adjacents, and in many cases that has entailed a move into retail forex trading. Already in possession of financial accounts that use almost identical infrastructure, the jump across represents a logical move.
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They are able to offer their existing clients higher returns than a traditional savings account, whilst simultaneously generating revenue from commissions on deposits. Here, we provide a list of those high street banks that now offer retail forex trading as an extension of their financial offerings.
Under the subsidiary of ADS Prime, this major Middle East capital markets and investment bank offers its clients FX, bullion and CFDs trading. ADS Prime offers its clients counterparty relationships with multiple liquidity providers. Its interface is the widely familiar MT4 platform that is also available on mobile. The leverage rate is customizable up to a maximum of 400:1. Clients also have the opportunity to develop their own EA that they are then able to adopt using their drag and drop EA builder.its
Under its global banking and markets arm, Santander offers distribution and market making activities for medium to large corporations and institutional private clients. With a presence in the main foreign exchange global hubs of London, New York and Hong Kong, it provide its services in its core geographical areas of Europe and Latin America. It has a broad product offering in spot, forwards, NDFs FX swaps and options for which it offers its clients up to 200 currency pairs with a specialized focus on the G10 and LatAm currencies.
With already several years in the FX retail industry, this French bank had the strategic insight to expand its operations, and particularly its FX sales team, in order to broaden the scope of its market share. In the past year, its efforts have been focused on establishing an FX options desk, as part of its Emerging Market Operations in Asia. This is particularly impressive when you consider that many other banks were minimizing the scope of their operations abroad. It provides both spot and forward foreign exchange trading.
With its international banking infrastructure, Barclays has for some time provided a foreign exchange service that allows clients to trade in up to 60 currency pairs. While it does not currently offer retail forex trading, it is believed that it is looking into further pursuing this channel of its operations.
Priding itself on offering transparent and reliable access to foreign exchange trading, Saxo Bank’s forex division is committed to the FX Global Code of Conduct, has an STP set-up structure and provides a tiered leverage margin that it promotes as “responsible”. Clients can trade over 100 currency pairs, starting at a minimum of 0.2 pips with which they can trade in spot, options and forwards. its platform has in-built stop limit and stop market order triggers, as well as triggers on the opposite side of the spread in order to protect clients from periods of increased volatility.