In a new ‘Q&A with’ with Shuo Wu, Global Head of FX Forward eTrading, we discuss issues clients have faced over the last year and how he and his team continue to drive innovation across their product range. The team recently won ‘Best Bank for Forwards/Swaps’ in the Euromoney FX Awards 2023.
What are the key issues that forwards and swaps clients have faced over the past year?
Given that FX swaps are mainly used for funding and rolling spot positions into future dates, and FX forwards are primarily used to hedge currency risk or take a view on future currency movements, underlying currency volatility and short-term interest rate volatility have significantly influenced market volumes – both of which have been on the higher end over the past 12 months. In addition, regulatory changes – such as the introduction of the standardised approach to credit risk (SA-CCR) and uncleared margin rules (UMR) – have significantly increased the cost of doing business.
How important is collaboration with clients for the bank?
At Deutsche Bank, we really emphasise the importance of engagement with clients. Ensuring the customer journey is a positive one lies at the heart of our offering – and open conversations with clients are one of the key drivers for the bank’s success. We rely on our clients as much as they rely on us: it is not just one-way traffic. As a result of these strong relationships and open dialogue, we are able to come up with robust and reliable solutions.
How has the bank continued to drive innovation across its product range in Forwards/Swaps? What new technologies have been and will be introduced to improve client experience?
Over the past year, we have made significant investments into our forwards and swaps technology that has enabled us to lay even stronger foundations for the next generation of our client offering. The bank’s technologies have all been built from the ground up with client-centricity in mind. Among the exciting technologies/products to be introduced in the coming year are elastic orders, elastic swap orders, which will offer customers full flexibility to work in their interest against both their peers and our principal desk, and flexible futures, that enable the bank to convert some of its OTC business to exchange traded products. Moving the trade off the balance sheet reduces costs for our clients – one of our key aims.
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In a new ‘Q&A with’ with Shuo Wu, Global Head of FX Forward eTrading, we discuss issues clients have faced over the last year and how he and his team continue to drive innovation across their product range. The team recently won ‘Best Bank for Forwards/Swaps’ in the Euromoney FX Awards 2023.
What are the key issues that forwards and swaps clients have faced over the past year?
Given that FX swaps are mainly used for funding and rolling spot positions into future dates, and FX forwards are primarily used to hedge currency risk or take a view on future currency movements, underlying currency volatility and short-term interest rate volatility have significantly influenced market volumes – both of which have been on the higher end over the past 12 months. In addition, regulatory changes – such as the introduction of the standardised approach to credit risk (SA-CCR) and uncleared margin rules (UMR) – have significantly increased the cost of doing business.
How important is collaboration with clients for the bank?
At Deutsche Bank, we really emphasise the importance of engagement with clients. Ensuring the customer journey is a positive one lies at the heart of our offering – and open conversations with clients are one of the key drivers for the bank’s success. We rely on our clients as much as they rely on us: it is not just one-way traffic. As a result of these strong relationships and open dialogue, we are able to come up with robust and reliable solutions.
How has the bank continued to drive innovation across its product range in Forwards/Swaps? What new technologies have been and will be introduced to improve client experience?
Over the past year, we have made significant investments into our forwards and swaps technology that has enabled us to lay even stronger foundations for the next generation of our client offering. The bank’s technologies have all been built from the ground up with client-centricity in mind. Among the exciting technologies/products to be introduced in the coming year are elastic orders, elastic swap orders, which will offer customers full flexibility to work in their interest against both their peers and our principal desk, and flexible futures, that enable the bank to convert some of its OTC business to exchange traded products. Moving the trade off the balance sheet reduces costs for our clients – one of our key aims.
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