Citi has shared its intention to reduce its global ambitions in the foreign exchange space since launching a review back in October of last year. To do so Citi will drop almost two-thirds of the trading platforms it gives currency quotes.
The bank has made changes to its vendor platform requirements and cut 12 of 53 connections to the bank being terminated, although further changes and cuts are likely in the months ahead.
One of Citi’s new requirements for its platform vendors is to sign the FX Global Code to achieve “priority” status. However, however this is only part of a series of assessments made by the bank.
The maneuver is also part of a resolution to cut costs and will mark a big change to its FX business, as the company is one of the largest dealers in the forex market.
Alaa Saeed, global head of Citi’s FX electronic platforms and distribution, says:
Alaa Saeed
Citi’s scorecard considers a number of key principles within the FX Global Code and we found notable findings in related to a number of key principles, including but not limited to, interaction with our liquidity, order management; market impact; liquidity aggregation, order routing logic; platform stability; testing of new products and coordinated releases.
Brian McCappin, the bank’s global head of foreign exchange institutional sales, added that Citi would hold annual reviews of the platforms it uses. New venues are most likely going to have to pitch in order to be considered for trading.
Other requirements included in the vendor assessment are the availability of SEF & MTF venues; vendor functional offering; the brokerage rate card and Citi’s ranking and participation on the platform.
The evaluation also gives score for customer service, API connectivity (by type, configurability, resilience and colocation) and execution capability. The check also takes into account transparency around interaction with Citi liquidity, platform stability as measured against Citi’s internal benchmarks and the level of investment towards client and Citi outstanding platform enhancements.
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