FXall Q3 results (some thoughts)

FXall Q3 results out, and covered here by LeapRate, including an updated IPO registration. LeapRate highlight the continuing decline in margins, as shown here.

FXall Operating Margins – under pressure (charts from LeapRate)

FXall Corp_margins                       FXall ECN_margins

FXall SEF: Separately, the NFA will provide regulatory services for FXall’s SEF offering, in preparation for when rules have been formally completed.

My view: Although, as previously mentioned,  we see single dealer platforms continuing as preferred channel through which buy-side firms access liquidity, whether provided by banks directly, or routed to SEFs where mandated. To date, 99% of FXall volume consists FX spot, fwds and swaps, all of which are exempt from SEF mandates.

Bank ownership: Under SEF rules, bank ownership is limited to under 25%, so will be interesting to see whether the current FXall bank shareholders each of which hold 5.1% (BNP, Citi, Credit Agricole, CS, Goldman, HSBC, MS, RBS – although the top three FX banks, Deutsche, UBS and BarCap are not shareholders in FXall) will cash in, or stay onboard to have a stronger influence on possible intermediation of their bank-client relationships, as mentioned here in could FXall become too big.

2 Responses

  1. […] interestingly, I asked just that question on 5th December following the release of FXall Q3 figures here, where I […]

  2. […] have background on items on the FXall IPO here, here and here Share this:EmailDiggStumbleUponTwitterFacebookPrintLinkedInLike this:LikeBe the first to like this […]

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