Joining the host of large banks who are now becoming more and more interested in the institutional FX market is Paris based BNP Paribas. With more than 200,000 employees BNP is one of world’s largest banks and was ranked world’s 13th largest company by Forbes in 2008. Along with the acquisition of AIG’s foreign exchange prime brokerage platform this seems like a strong move by BNP.
The new platform is a key part of BNPP’s FX strategy to compete with other banks’ FX e-trading platforms, including Deutsche’s AutobahnFX and Barclays Capital’s BarxFX. BNPP is aiming FX eTrader at regional banks, hedge funds, and corporate and institutional clients. This is a new target market for BNPP; its old internal platforms, Click FX and FX dealer, were, Cohen confessed, “not strong enough” and “incomparable to FX eTrader”.
“This is a pure consequence of market-share acquisition through new clients and deepened penetration overall,” added Francois Boisson, European head of the FX sales institutional client group at BNPP in London.
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FX eTrader, based on software from Java, a third-party vendor, took a year to develop. Its network connectivity is provided by BT Radianz but the pricing engine, aggregation system and liquidity management system are all proprietary to BNPP. In addition, BNPP uses an in-house aggregator based in London for all its trades. FX eTrader offers spot, forwards and swaps, and supports 57 streaming currency pairs, 20 indicative emerging markets currency pairs and 600 pairs in total.
I wonder though when will BNP also start offering FX trading to retail clients as well? If Citi and Deutsche Bank decided that this segment was interesting enough I’m sure that BNP will follow as well.
Deutsche is using FXCM Trading Station white label while Citi white labelled Saxo Bank.