FX Connect is working with technology provider SunGard to break into corporate forex. This will increase competition among the three existing multibank forex portals, posing a threat to Currenex and FXall.
FX Connect, owned by State Street, says it recognized some time ago the need to move into corporate forex. "It's a bit of a departure for us, but we always believed we would have to find a way into the corporate market," says Steve Smit, managing director of Global Link, State Street's cross-product platform, of which FX Connect is a part. "If you look at the [foreign exchange] market, there are tens of thousands of corporations that play a significant role."
Until now FX Connect has focused on serving institutional investors. By making its portal available on SunGard's treasury management system it has access to a potential 1,400 new corporate clients, more than 500 of which are in the Fortune 1000. This could increase FX Connect's transaction volume and online market share significantly.
SunGard says it chose FX Connect over the other portals for several reasons - not least the volume of forex flow it is transacting. Executed trades regularly reach $10 billion a day (counting only one side of the trade and one leg of swap deals).