BNP Paribas and NatWest tap United Fintech’s CobaltFX to manage credit exposures

Rick Steves

“CobaltFX’s Dynamic Credit technology ensures that for less credit deployed, there is more liquidity, administrative simplification and, essentially, superior market access control – the latter being a key factor for financial institutions around the world.”

CobaltFX has announced that BNP Paribas and NatWest have gone live with its ‘Dynamic Credit’ to manage credit exposures for FX trades on interbank trading venues.

Recently acquired by United Fintech, CobaltFX aims to simplify and streamline the allocation of credit for FX transactions between banks and improve access to liquidity.

The company stated that onboarding BNP Paribas and NatWest is indicative of an increasing trend of financial institutions wanting to optimize the disbursement of credit for FX trades and simultaneously improve market access and control.

Both new clients have been key partners of CobaltFX throughout the years, yet now they’ve gone live with the latest product, Dynamic Credit, in a move to manage credit exposures for their respective financial institutions, addressing overly manual processes as well as market access and control.

“Correcting the supply of credit and at the same time deepening the availability of liquidity”

Andrew Coyne, Founder of CobaltFX, commented: “The problem CobaltFX is solving is essentially simplifying and streamlining many of the manual processes tied to allocation of credit which creates challenges for financial institutions. I.e. leveraging tech to enhance market stability. Thus, correcting the supply of credit and at the same time deepening the availability of liquidity, CobaltFX’s Dynamic Credit technology ensures that for less credit deployed, there is more liquidity, administrative simplification and, essentially, superior market access control – the latter being a key factor for financial institutions around the world.”

Joe Nash, Digital COO for Foreign Exchange, Rates and Commodities, BNP Paribas, said: “Industry-wide, we see that banks are adopting innovative techniques to manage credit exposures for FX trades and maintain market stability through digitalisation. CobaltFX’s solution offers a much needed improvement to the manual process of updating credit limits with interbank trading venues. By providing a standardised and digitised approach, and aggregating IT infrastructure across multiple venues, ‘Dynamic Credit’ gives banks unprecedented control to navigate fast-moving FX markets and proactively manage credit exposure. This is a very important step in delivering a solution for credit providers, taking full advantage of new technical advancements.”

Christian Frahm, founder & CEO at United Fintech, stated: “What we see is that leading financial institutions are seeking to decrease the number of third-party vendors which used to mean bigger contracts with so-called legacy providers, yet this is where United Fintech differentiates with a fresh approach to cater to the trend: We offer a selection of best of breed technology products under one umbrella to financial institutions wanting to challenge legacy providers and solutions, thus giving both sides the benefits of becoming part of something bigger. And our prediction is that we will see many more banks and fintechs follow suit and join each other’s journeys on our digital platform”.


Cobalt split into two: CobaltFX and upcoming Digital Asset division

Following United Fintech’s announced acquisition of Cobalt late last year, the purchased business will be solely concerned with the FX industry thus leaving the company’s Digital Asset division outside the product offering, for now.

The Digital Asset division will form a new venture in Q2 2023 to address the growing DA space perceived as the next thing banks will want to get ahead of in order to stay on par and future-proof their models. Thus, a much anticipated United Fintech DA spin-off is impending with further details to be disclosed in Q2.

As part of the restructuring, Cobalt was rebranded as CobaltFX and will be able to focus on product development, client satisfaction, and further innovation. In December 2022, United Fintech bought Cobalt from Citibank, Standard Chartered Bank, S&P Global, and SGX, as part of its strategy to acquire fintech businesses and offer their services to banks and other institutions.

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