Trade reporting to authorities via Trade Repository is key to transparency in FX markets: Krungsri

And KBANK suggests moving towards a single trading platform.

The banking industry is striving to keep up with the rapid developments in technology, and the forex sector is not an exception. Though the rise of currency e-trading in Asia is both a challenge and an opportunity for banks, industry players agree that there is a need to improve transparency and security through this platform. We talked to Asian bankers and here's what they have to say:

ABF: What are your thoughts on the rise of currency e-trading in Asia? What can be done to improve transparency and security through this platform?

Masashi Nimura, Deputy Head of Global Markets Group, Krungsri (Bank of Ayudhya PCL):
Trade reporting to authorities via Trade Repository (TR) might help to improve transparency of the market. Security might be improved if e-trading is connected through leased line only, currently most systems allow household internet broadband to be connected.

Thiti Tantikulanan, Capital Markets Business Division Head, KASIKORNBANK:
Currency e-trading may be currently suitable only for Asia's frontier markets e.g. Japan, Singapore, Hong Kong, where the currencies are freely traded, but not for developing markets where even regulatories governing markets are not transparent and a lot of time hindering transactions execution.

For the frontier markets where currency e-trading may suit, moving towards single trading platform can probably help improve transparency as all participants are gathered in one market place which can possibly help eliminating pricing arbitrage among each platform.

Using single platform may also help simplify technical structure for security control as it is no longer necessary to maintain watchdog on access to platform here and there.

Ng Kwee Ming, Executive Director, Corporate Treasury and Advisory, United Overseas Bank:
FX has transformed from a purely transactional product to an advisory, solution-based service. Over the years, e-trading as a platform has become beneficial for both the customer and the bank. Customers can use e-trading to trade on-the-go and enjoy lower transaction costs on line. E-trading has also helped to encourage a more efficient and transparent market for FX, saving customers both time and cost.

At the same time, our relationship managers can focus on providing tailored-made advisory solutions to our customers. E-trading on mobile devices also means that we can enhance the banks’ reach to more customers in the region.

What is worth noting is that e-trading does not circumvent regulation challenges. E-trading serves as an additional convenience and platform for our customers but the key is still in the ability to trade in local currencies according to market regulation. 

Johannes Husin, Treasury Director, OCBC NISP:
Asian banks has become more competitive in FX Markets therefore e-platform is a must have products to reduce their bid/offer spread and provide transparency for the clients.