Banks Join with Currenex to Bolster Forex Market Liquidity
ABN Amro N.V., Barclays, Standard Chartered and several other banks joined Currenex in announcing the Enhanced Market Access (EMA) initiative. This initiative lets companies and fund managers trade with any of the 45 banks on Currenex’s online trading service in a ground-breaking new approach to online dealing. In the foreign exchange market’s current structure, corporations and other ‘buy-side’ institutions are limited to dealing only with banks with which they have credit lines. EMA lets banks become ‘hubs’ on the Currenex system through which corporations and other buy-side institutions can trade directly with a wide range of ‘spoke’ banks using interbank credit lines already in place. By eliminating the credit constraints on entering new trading relationships, EMA greatly expands the number of market participants that can transact with one another, increasing the available pool of liquidity in the online FX market. Currenex is delivering an interface to credit systems that enables hub banks to carefully allocate credit and manage risk.