Known as one of the top retail FX players in Switzerland, Swissquote Bank has also made moves in the institutional and crypto markets. Jonathan Hirsch, Associate Director and Head of Institutional FX & Crypto Sales at Swissquote describes that evolution.
You’re known primarily as private/retail FX service provider, how long have you offered institutional services and why did you move into this market segment?
Indeed, Swissquote’s success has been built on the retail market, and this since early 2000s. Institutional services have been implemented since 2017-18, initially by offering custody services. From there, the natural evolution was to allow institutional clients to also take advantage of our eTrading ecosystem that is now a so-called one-stop shop. By designing the offering for the retail market and by growing alongside the success, we felt it was time to enter into a more professional world with a revised approach.
Who comprises your institutional clients, and in what proportion?
Thanks to our custodian offering on cryptocurrencies as well as traditional asset classes, we have been able to attract a whole range of institutional clients of different sizes and types. They include regional and private banks, family offices, hedge funds, asset managers, brokers and corporates as well as crypto institutions. Their proportion, in comparison to retail clients, is still minor in terms of actual numbers but not in term of revenues. We are probably ranging between 5 to 10% of institutional clients.
What are they looking for from Swissquote, and does it differ depending on the client type?
They are mainly looking for electronic access and optimisation of their trading activities. Just a few years ago, the trend was to have specific partners for each product of interest, but I think now this has evolved and institutional clients are now looking for a one-stop shop where they can aggregate and trade all asset classes with one counterparty. We are also seeing interest in cryptocurrencies, which attracts a new client base and allows us to cross sell across all our products.
Who are your main competitors and what differentiates you from them?
Swissquote is unique. We do compete with different companies but no one has the same position as Swissquote on the market and offers such a wide range of services and trading solutions all in one place, in one account and in one bank.
Post-pandemic, how has the business developed?
Swissquote is an online leader in providing brokerage services in FX, securities, crypto and banking. We saw a very little impact of the pandemic and afterwards we continued our planned growth with introduction of our news platforms, services and tools. Our market share in key markets continues to grow. We are also expanding into new markets with Swissquote South Africa. We’ve also expanded our impact in crypto with the development of SQX. This is our crypto exchange which aggregates liquidity from many different sources, including major external crypto exchanges as well as Swissquote and its clients, and is able to provide even more competitive bid and ask prices at any given time.
What are your business development plans across the group, but for your institutional business in particular?
Institutionally our key objectives are to take leading positions on the Swiss market for FX spot and derivatives’ deliverable FX, and expand our network of clients and counterparties in both custody and securities brokerage.
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