eFX is a tremendously important tool that clients can use to leverage the efficiencies technology creates in a wide variety of transactions. We believe that eFX will continue to gain traction, and Bank of America is committed to being a leading provider of electronic solutions. Our goal is to continue to evolve our products to meet the dynamic and growing needs of our clients.
What benefits do clients, looking to use electronic channels, gain from choosing FX providers that are market makers, such as yourselves, rather than price takers?
A bankÃ¢â‚¬â„¢s ability to provide its clients electronic access to liquidity across a broad range of currency pairs is a pre-requisite for a broader dealing relationship. This is especially true in electronically dealing where the speed of quote has become such an important factor in how clients distribute business.
Is the application of e-commerce in foreign exchange guaranteed to improve relationships with clients or are there risks associated with it?
Electronic trading has the potential to create tremendous value for clients and therefore banks that provide best-in-class service will likely enjoy enhanced relationships with their clients. Increasingly, clients are expecting dealers to be able to service their needs electronically. As technology improves and client expectations continue to increase, banks will need to continue to improve their level of service or risk damaging the relationship.
Some equate increased automation with improved service levels. Do you go along with that point of view?
Clients continue to look for ways to improve efficiency, reducing costs and time spent on non-core activities. The extent to which any Bank can help solve their clientsÃ¢â‚¬â„¢ problems should improve the overall level of service. For many types of trades, automation minimizes the time a client has to spend processing or repairing trades, and for that fact alone should improve overall service levels.
How was active client feedback brought into the development process of your new web-based platform, FXtransact?
From the earliest stages of planning, we have been in active dialogue with our clients regarding their priorities and preferences. From focus groups and one-on-one discussions to beta-testing and further more rigorous procedures, the client has been at the center of our platform development. Client needs continue to evolve, making it paramount to maintain continuous dialogue. We look forward to continuing to bring enhanced features and functionality to meet the growing demand in this dynamic environment.
What specific features and functionality were clients asking you to incorporate into the platform?
In addition to fast and reliable pricing, one of the most frequently requested features for clients is the ability to integrate FX into their payments and cash management products, which as a leader in global cash management is a priority for us. That said, itÃ¢â‚¬â„¢s a dynamic environment and important to continue to enhance the technology to anticipate client needs.
New eFX services such as White Labelling and e-FX Prime Brokerage are now gaining significant traction amongst financial institutions. How much emphasis are you placing on these types of services in your own offerings?
All global FX dealers looking to service the hedge fund and financial institutions market segments need to be able to provide products and services tailored to the unique needs of these clients. Hedge funds in particular seek deep liquidity and pricing, which will continue to drive the development of e-FX prime brokerage. We also have a white label product and are in discussion with financial institutions seeking to benefit from the level of service, customization and functionality we can offer.
Given the success of the multi-bank trading portals, do you think there will always be a role for proprietary platforms?
As a founding member of one of these portals, yes, we certainly do see an important role for them going forward. We see clients accessing a variety of channels for pricing and execution.
However, in addition to leveraging multi-bank portals, it will continue to be important for clients to be able to access liquidity from a bankÃ¢â‚¬â„¢s proprietary platform as well.
Recent surveys suggest almost 40% of the largest global institutions are now trading online but also indicate many users still remain offline due to a lack of true STP. How will the value proposition of eFX be made stronger by providing more comprehensive STP solutions?
Clients looking to use technology to increase their processing efficiency are increasingly looking to the benefits provided by Prime Brokerage businesses. There is also increasing demand from clients to use APIs, which allow clients to access liquidity from within their proprietary systems. We will continue to improve our product offerings to meet the demands of these clients.
Looking to the future, how is Bank of America planning to differentiate itself from your competitors in the electronic trading environment?
Only by staying close to our clients and continuing to innovate can we expect to deliver the level of service our clients deserve. In an increasingly transparent and automated market, all banks will be challenged to provide a complete range of electronic services tailored to meet client demand. Our global reach, the depth of our client relationships and understanding of their specific needs will continue to differentiate the calibre of service we are able to provide.