Two heavyweights in the finance industry, Deutsche Bank and BNY Mellon, have made a partnership in order to develop an API-enabled solution for FX. This solution is taking steps to ensure that confirmation times are improved when it comes to restricted emerging-market currency trading.
Joining Forces To Streamline Emerging Markets
The digital solution itself was originally applied to custody FX transactions, specifically in Korean Won. Now, though, it’s planned to be used in order to reduce the pre-trade lifecycle from hours to seconds. This, in turn, will minimize the manual intervention and operational burden that’s somewhat prevalent in the custody emerging-market FX.
The solution itself had already gone live in places such as Korea, targeting the Indian Rupee and the Indonesian Rupiah. As time goes on, however, it’s planned to be rolled out progressively across an array of restricted currencies. It will all be linked to the fixed-income and underlying equity transactions of the investors, as well.
Improving The Industry At Large
The idea behind the solution is the use of the existing bots between two banks, which allows for instantaneous communication. This, in turn, aims to help in the elimination of market frictions. Furthermore, it’s planned that this solution will help bring the time of execution closer to the actual trade remediation, as well. All of these benefits can lead to a reduction of price slippage when it comes to clients, particularly between the fixed-income or equity security trade and the FX leg of that transaction.
David Lynne stands as the Head of Fixed Income & Currencies, as well as Corporate Bank, within Deutsche Bank’s APAC arm. He went public in praising this solution as a milestone, one that solves a long-standing issue within the world’s emerging markets. As such, Lynne stated that the solution’s application for the banking firm’s clients, as well as the industry, is a broad one indeed.
The World Turns Ever Onward
Lynne went further, claiming that this solution is a testament to Deutsche Bank’s commitment to being the market leaders in execution. This is particularly true within these times, when focus on costs as well as investor participation within these markets are only increasing, according to Lynne. With the new collaboration, he explained that both organizations are playing to their strength and experience with it comes to custodial FX, emerging markets, innovation, and digital workflow.
With these two heavyweight companies developing the solution, investors are capable of earning more through their trades. As a direct result, these companies will earn a profit, but that’s to be expected. The world’s just one big business, eager to profit, profiting off others, and being used to earn a profit, in turn.