Since the removal of access to counterparty credit by many banks, several non-bank entities have entered the liquidity provision space. We dissect how to differentiate a REAL prime of prime from a retail firm that offers a B2B price feed from its own desk
+ Read This Next
Double standards: Standard Chartered insists on massive capital and liquidity charges, yet fails to meet its own required capital stipulations
Standard Chartered divests from retail banking even further and concentrates on Tier 1 electronic trading, the firm continues to stipulate charges for having to cover margins if there is a drop, also has capital charges in place on its PB contract, yet does not meet the capital requirements stated by the Bank of England.
It is the opinion of many Swiss banking executives that I have spoken to this week that compliance, and not just balance sheet size, is a major, and unwritten consideration for Tier 1 banks when extending counterparty credit to the OTC sector. Here is my opinion
How brokers can check what a REAL prime of prime is: FinanceFeeds round table with Saxo Bank in London
It is very important for brokerages to look in great detail at how a prime of prime is structured and how its relationships with brokers, banks and ECNs is vital knowledge to ensure correct execution. Two highly experienced Prime of Prime specialists explain all.
Several meetings with senior Tier 1 bank executives and leaders of prime of prime brokerages in London recently have demonstrated that, as long as the criteria is met, the OTC FX industry is a vital business that the banks cannot afford to miss out on. Here are my findings thus far.
Prime of prime firms tempted to look toward high net worth direct business are upping their minimum deposit amount as fear sets in
FinanceFeeds dissects the entire situation and speaks to the banks and the traders concerned.
ADS Securiites senior executives take a close look at Prime of Prime relationships and how credit intermediation is the key to future execution models.
All new prime of prime brokerage launches in London, headed by Integral’s Ramy Soliman. We speak to him in detail
“Are you implying that some Prime of Primes are offering liquidity that is perceived to be based off direct relationships but turns out to be indirectly sourced? If so, there is a limitation on the capacity of liquidity that the provider can genuinely service without a deterioration in the pricing and execution” – Ramy Soliman, CEO, Stater Global Markets
The bias toward hedge funds and trad prime brokerages is not new. It is resurfacing though, as the listed derivatives lobby once again puts its 2 cents in…. Or should that be $50 million?