Conference Dailys TRADETech FX Daily 2019: Wrap-up | Page 9

THETRADETECHFX DA I LY
in-depth
Banks hail ‘golden age’ in FX amid
evolving buy-side relationships
PANEL OF MAJOR BANKS AT TRADETECH FX AGREE THE SELL-SIDE HAVE CHANGED THE MENTALITY AROUND NEW
PRODUCT DEVELOPMENT, AS THE BUY-SIDE SEEKS INCREASED AUTOMATION AND INTEGRATION.
From cover page
“We are living in interesting times as banks
pull out of equities and fixed income,” said
David Wilkins, head of global eFX sales at
Goldman Sachs. “But that’s not the case for FX
where we are seeing a golden age on the sell-
side. The mentality and mindset around how
we develop products, and the way our clients
use those products, is changing.
“Across the industry, we have limited tech-
nology spend, so we can’t just endlessly build
everything for clients and hope they will use it.
We need to take a more consultative approach
as to how we build, and listen to clients. Any
client I speak to in any part of the world is
trying to automate their business in some kind
of sense, but the days of ‘here is our spec, come
and integrate with us’, are over. Now, it’s about
how we can integrate with them using open
architecture and systems.”
Joe Nash, FX and local markets digital COO at
BNP Paribas, which launched the latest version
of its Cortex LIVE FX trading platform at the
event, agreed with Wilkins, adding that the
pressures facing the buy-side are also being
felt on the sell-side. Cost savings are now being
driven by integrating operating systems, as
opposed to spread pressures.
“The days of developing a product and seeing
what sticks with clients are over. We don’t have
the resources on the sell-side either,” Nash said.
“We need to target the limited resources we
have to help clients automate the workflow
for cost efficiencies. It’s the next-generation
of tools as the industry moves from manual
processes to automated processes.”
Wilkins from Goldman Sachs continued that
challenges for the sell-side with innovating and
delivering new solutions to clients occur when
the individual buy-side firms seek similar, but
differentiated products, meaning banks have to
adapt to satisfy those requirements.
“The buy-side must be aware of this,” Wilkins
said. “It can be infuriating for us when a client
changes their execution management system
or order management system every two years,
and we need to work hard and do our homework
to work with them again. It’s a challenge for us,
but the buy-side need to be aware that there is
a big risk with switching systems often.”
Other new methods on the sell-side to inno-
vate for clients, according to the panel, include
partnering with and presenting FinTech firms
that could help with certain challenges on the
buy-side. The global head of eFICC product and
distribution at Barclays, Mauricio Sada-Paz, told
delegates that the innovation incubator is a
good method to do this.
“When I meet heads of trading on the buy-
side, they are often worried about what the
market is going to look like down the road,”
Sada-Paz said. “There are FinTech firms moving
into the industry to solve major challenges,
but the buy-side simply don’t have the time to
meet every single one.
“Taking them to our innovation team
incubator, RISE, and allowing them to meet
companies is a great way. We know the client
pain points, and we are either invested in or
studying the FinTech firms, so we can put them
in contact to see if they can help with some of
those issues.”
The official newspaper of TradeTech FX Europe 2019
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