Singapore: Citigroup Inc. is planning to join UBS AG with an electronic currency trading and pricing platform in Singapore, setting up systems to boost liquidity in Asia’s biggest foreign exchange hub. Singapore will become the fourth forex trading engine location for Citi, which also has systems set up in Tokyo, New York and London, the bank said in a statement Monday.
“The expansion of our FX trading engine will also lead to a vast improvement in latency for our clients in Singapore and across much of Asia Pacific, who prior to this would connect via Tokyo or one of our trading engines outside of the region," Stuart Staley, Asia Pacific head of markets and securities services, said in the statement.
The facility, which is slated to go live in the fourth quarter, will support 23 spot currencies including all those in the Group-of-Ten (G10). The planned expansion is expected to inject more liquidity into Singapore’s currency market, which recorded $517 billion in daily average trading volume in 2016—higher than Hong Kong and Japan, according to a triennial central bank survey by the Bank for International Settlements (BIS).
Citi’s system is also expected to support 13 deliverable emerging-market currencies. The engine will be built in-house and includes a proprietary pricing and hedging algorithm, through which clients can deal. In addition to currencies, the platform will allow trading of gold and silver.
Citi is the fifth-largest currency trading firm by market share last year, after the likes of JPMorgan and UBS, according to a Euromoney Institutional Investor Plc survey.