Globally, FX markets are still under intense scrutiny from regulators and fear seems to stalk the FX markets, which turns over $5 trillion in a day. The FX market is an unregulated OTC market lacking reliable, aggregated, global stats to benchmark the survey outside of BIS studies.
The study aims to capture only client price-taking activity and not interbank/interdealer broking volumes. However, the survey believes that it provides an accurate proxy for trends and distinguishes the relative performance of the banks that are ranked. This year, Euromoney registered 14,050 verified votes with a total volume of $225.2 trillion.
The first 23 years of the survey, Citi dominated the results and the bank is now back at the top after being beat by Deutsche Bank since 2002. This achievement marks the success of a turnaround in Citi’s global foreign exchange business over the past five years.
Under the direction of former head of foreign exchange and local markets, Anil Prasad, Citi took businesses with a regional focus and turned it into a global franchise. The bank heavily invested in technology with its Velocity platform, which narrowed the gap in e-trading to Deutsche bank. Citi then built an intuitional platform to mirror Citi’s traditional strength in corporate and retail FX.
The current global head of FXLM at Citi, Nadir Mahrmud, commented on the results: “our return to the top of the poll is a validation of our continuing effort to better serve our clients by providing them the best pricing, trade execution and advisory services in the city”.
At the beginning of the century, Citi began to fall behind Deutsche Bank, UBS and Barclays, falling all the way to 5th in 2009. The US based bank worked to rise back up over the past five years, by a narrow margin to top the overall market-share rankings, settling at the top at 16.04%. Deutsche Bank claimed 15.67% of the market share this year.
The German Bank maintained leadership in electronic trading and continues to be the leader in the options market, with a market share 7% higher than rivals Citi, Barclays and Bank of America Merrill Lynch.
Barclays edged out UBS for third place with respective market shares of 10.91% and 10.88%. HSBC stayed solidly in fifth place with a market share of 7.12%. Overall this is the first time since 2009 that the combined marketshare of the top five banks has exceeded 60%.
Bank of America Merrill Lynch saw a large gain in market share from corporate clients, with volumes rising over 151% since 2010. The banks have combined the strengths of Bank of America and Merrill Lynch in corporate and intuitional businesses.
With the growth of business in Asia, Australian banks have seen a large improvement in rankings since 2011. ANZ, NAB and Westpac all grew their market share to contribute to the growing strength seen from the region.
The top risers from the past three years may be seen in the figure below.
For more details and the outcome of the survey, click here.