Standard Chartered Bank, a British multinational banking and financial services company headquartered in London, is planning on launching a foreign exchange (forex) electronic trading and pricing engine in Singapore, according to a report from the Business Times.
With the support of the country’s local regulator, the Monetary Authority of Singapore (MAS), Standard Chartered plans on launching the e-trading and pricing engine by the first quarter of 2020, the Singapore news outlet said.
Standard Chartered Engine to Provide e-Trading of 5K FX Pairs
On Monday, the London-headquartered firm announced via a media release that its FX engine will allow its clients to trade 130 currencies and more than 5,000 currency pairs, which will be available in spot, forward, swaps, non-deliverable forwards (NDFs) and options.
In addition to forex instruments, the engine will also offer e-trading of commodities, for both precious and base metals.
The e-trading infrastructure which will be based in Singapore adds to the British firm’s existing suite of engines which are located in London, New York, and Tokyo. It will give its Asia-based clients easier access to liquidity in addition to more efficient FX trading.
Commenting on the announcement, Michele Wee, head of financial markets Singapore at Standard Chartered said: “E-trading take-up rates are very high among our clients; we have seen our FX e-trading volumes grow by 40 percent year on year.”
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Furthermore, Wee also stated that the British bank could also offer “consistent pricing” to meet the hedging requirements of its Asia-based clients through the e-trading platform.
MAS is Pushing for Singapore to be an FX Hub
Singapore’s MAS is actively trying to make the country a major forex hub in the world. As Finance Magnates reported, the regulator is encouraging firms to start building trading engines in the country, such as the one announced today.
“The move is aligned with our goal of enhancing liquidity, price discovery and transparency in Singapore’s FX market by strengthening FX e-trading capabilities and market infrastructure,” added Gillian Tan, executive director in the financial markets development department at MAS.
When trading in Singapore, FX trades have to be routed via locations, mainly Tokyo and London, outside of the city-state at present. That’s because most financial institutions have put their trading engines in those cities.
However, this means that trading in Singapore can take a few milliseconds longer than it otherwise would – which makes a big difference in the FX space.
Earlier this year in March, FastMatch, Euronext’s Electronic Communication Network (ECN) for FX trading revealed that it is setting up a new matching engine in Singapore, which will come into effect in the final quarter of 2019.