With ever increasing numbers of clients in Switzerland’s unique market, IG Bank is now expanding to Zurich. Today, FinanceFeeds speaks to IG Bank CEO Fouad Bajjali to gain perspective on the company’s strategy in serving the sophisticated Swiss client base, including both retail and institutional participants
Switzerland has a special status within not only the global banking and financial security arena, but also within the realms of specialist electronic trading entities.
In Switzerland, all electronic trading companies providing access to financial markets and multi-asset trading facilities must be registered as a bank, and thus for several years, the market was dominated by domestic market firms such as specialist boutique company Dukascopy and Swiss financial markets giant Swissquote.
More recently, evergreen British retail FX and CFD company IG Group established itself in Geneva, with a Swiss banking license from FINMA, heralding the firm’s Swiss subsidiary, IG Bank.
This week, IG Bank has begun to expand, having opened an office at Paradeplatz 4 in Zurich, in conjunction with the launch of a new unique educational offer with the Swiss Association of Market Technicians that allows traders to acquire extensive technical analysis skills. Thus, IG demonstrates a strong commitment to education and the Swiss financial center.
To boldly go where only a few have gone before is not the norm for the retail FX industry, as many companies tend to follow the lead of others and at best find it hard to define a value proposition, and at worst, become an also-ran.
For a large, well established, publicly listed company with a top drawer reputation such as IG Group Holdings plc (LON:IGG) to go to the lengths of establishing itself as a Swiss bank, in Geneva’s investment banking heartlands, among large, well known wealth management firms as well as domestic rivals Swissquote and Dukascopy Bank was a brave move, however with a quality reputation and publicly listed homestead in London, IG Group’s foray into such a specialist region has proven to be a fitting move.
Two and a half years ago, FinanceFeeds met with IG Bank CEO Fouad Bajjali in Geneva, who explained enthusiastically
“Banking is changing. Fintech is a buzzword over here in Switzerland and we are different to standard Swiss entities and are happy to show that. We hired a cross section of staff from the traditional Swiss banking industry, some have worked in the Swiss finance industry, and some from the FX industry here in Switzerland so we know how to cater to the clients and build a brand.”
Mr. Bajjali noted that there was a great deal of autonomy in terms of the operational structure of IG Bank during its initial period. Former IG Group CEO Tim Howkins was involved with regular catchups, because there was a startup investment involved, but was able to allow the division to flourish on its own. Indeed, Mr. Howkins can be credited with the legacy of having been one of the FX industry’s most competent CEOs.a long list.
“Establishing a startup as a Swiss bank is interesting” said Mr. Bajjali.
He explained that once, a financial journalist in Geneva asked “More traditional Swiss banks closing than opening, so why are you here?” Mr. Bajjali’s opinion is that the company’s product specification and range of services is totally different to traditional Swiss banks, therefore this is a good advantage.
These initial thoughts and considerations built IG Bank’s now expanding presence, hence today, FinanceFeeds spoke once again to Mr Bajjali to gain greater perspective on the firm’s expansion of its Swiss entity into Zurich.
When asked by FinanceFeeds why expansion was felt necessary by IG in Switzerland, Mr Bajjali today explained “We have a great and growing client base, there are benefits of being in a prime location in Zurich. For example, client demand to have a physical presence in the German-speaking part of Switzerland. More broadly, IG is a global leader in trading and we expand where we see client demand and business opportunity. We are very excited to be expanding in Switzerland.”
The concentration on the unique nature of Swiss customer requirements was then covered, with FinanceFeeds having posed the question as to which clients the new Zurich office will serve, Mr Bajjali having replied “We have a sophisticated Swiss client base, including both retail and institutionals, that we serve through IG bank. Having the office in the heart of Zurich allows us to serve our Swiss German clients in an optimal way and to be closer to our institutional target groups, including external asset manages and Hedge funds that are mainly located in the Swiss German part.”
Elaborating on what the advantages of trading with a Swiss bank like IG are, Mr Bajjali confirmed “IG is a well-established global leader with over 40 years experience. When trading through our Swiss bank, clients know they are working with a strong compliant provider that has their clients interests at the heart of what they do. IG Bank provides customers with a tailored offering for the retail and institutional business, including client services such as comprehensive education tools and dedicated customer service which makes it a popular choice.”
With niche markets being absolutely essential these days, and Switzerland being a very strong region which is outside the MiFID II remit and is a haven for high net worth multi-asset investment that does not depend on third party platform use, IG Bank’s corporate direction in Switzerland can certainly be viewed as a worthy one.