Citi and HSBC are the first foreign exchange (FX) prime brokers to go live on Capitolis Novation, a technology platform which automates the currently manual workflow in both FX prime broking and bilateral trading.
Image: Citi, HSBC go live on Capitolis platform. Photo: Courtesy of Markus Spiske/Unsplash.
Capitolis said both the banks went live with its platform last December, contributing to bring the service to market.
The service is claimed to have streamlined the novation process and has helped in reducing the time required to complete FX options novations, benefitting both the selling side and buying side.
Citi OTC clearing global head and foreign exchange prime broking head Christopher Perkins said: “Citi remains focused on delivering industry-leading capital and operational efficiencies to our clients with robust scale and automation. We are excited to partner with Capitolis since its inception to drive capital optimization and reduce costs through automated FX options novation processing.”
Capitolis Novation helps reduce overall balance sheet notional and risk exposures that banks currently use to meet their regulatory capital requirements. It was launched last May and is touted to be the first industry-wide platform for end-to-end FX novation processing.
HSBC global intermediary services global head Vincent Bonamy said: “Efficiency and transparency have always been at the heart of our Global Intermediary Services offering for clients. The FX Prime Brokerage novation tool will provide access to liquidity and credit in the FX options market, while allowing clients to offset their positions across their network of banks.”
Capitolis CEO Gil Mandelzis said: “Citi and HSBC have partnered with Capitolis to be at the vanguard of establishing this industry solution for FX novation. We are grateful for them for helping us bring it to market with their incredible support, technical expertise and collaboration to shape what we believe will be a meaningful solution to address a key constraint in the capital markets.”
Last October, Capitolis partnered with NEX Optimisation to launch FX Novation service through the NEX Infinity platform. With this collaboration, NEX Optimisation customers will be able to connect with Capitolis FX novation service with minimal integration requirements and resources, while reducing the time take taken to go-live.