FX house of the year, Singapore: OCBC Bank

A focus on client needs, scale, scope of product array and providing liquidity in all conditions wins OCBC Bank the FX house of the year, Singapore award

The past 12 months saw Singapore emerge from the last of the ‘circuit-breaker’ measures designed to halt the spread of Covid-19 and the adjustment to a new post-pandemic norm, including coping with ongoing hybrid working arrangements.

For OCBC Bank, Singapore’s longest-established bank, the immediate challenge of this new operating environment for its FX business was to focus on its clients’ most pressing needs and to remove any roadblocks to ongoing business requirements.

A key concern for clients during the past year – and still, given heightened market fears following the Russian invasion of Ukraine and the prospect of rising global inflation and interest rates – was the depth of market liquidity. As the second-largest financial services group in Southeast Asia by assets – with more than 420 branches and representative offices in 19 countries and regions – OCBC Bank was exceptionally well placed to deal with these concerns. It continued throughout this period and beyond to provide an optimal market-making FX service to its clients, across major and minor currencies, and across different FX product types and tenors. For the bank, this liquidity needed not only to be deep but also consistent and not subject to undue levels of price latency, despite the extreme disruption prompted by the stringent health measures.

OCBC Bank reacted to pandemic-related volatility, as well as the subsequent geopolitical and global economic-related volatility, by seeking to differentiate itself from other banks in its overall business strategy in addition to its handling of its corporate and institutional clients. The bank maintained strong momentum towards digital innovation during the pandemic. Enhancements have been made to the corporate cash management platform, OCBC Velocity, providing corporate clients with the accessibility to transact FX electronically.

This was made possible by automating large portions of the account opening and data synchronisation between OCBC systems. A new FX time option product has been added to its electronic channels, a big step toward availing clients the same flexibility for cash management as this was previously only available via non-electronic channels.

A core component of a broader e-commerce push was OCBC Bank’s integration of its FX pricing engine with its Group Wealth FX Cash platform – a common platform across Global Consumer Financial Services (GCFS) Singapore, GCFS Malaysia and the Bank of Singapore. The project enabled real-time price discovery, straight-through execution and trade booking of FX cash transactions. These new capabilities allowed for the major enhancement of the bank’s client value proposition and frontline efficiency, characterised by clients receiving highly competitive pricing and instant confirmation. At the same time, relationship managers receive real-time price streaming with zero email requests, zero hand-offs and zero lead time.

In parallel to these developments, OCBC Bank continued to strengthen its internal pricing distribution capabilities by providing automated pricing for low-cost remittance to end-clients directly on its internet banking platform. This was conducted on the basis of the automation of price discovery and trade execution freeing up individual sales time from transactional voice calls, which are latent in nature, thus significantly improving client experience over electronic channels. Similarly, from a post-trade perspective, such timely and accurate straight-through processing of booking trades eliminates manual trade entry by sales departments, removes human error and provides for accurate round-the-clock market and profit-and-loss positions to sales teams. As an adjunct to this, the bank’s research team ramped up outreach efforts to clients by leveraging technology during the circuit-breaker periods.

One notable example of such efforts that has received exceptionally positive feedback from clients was the launch of a podcast channel that provided incisive highlights on key research findings, enabling clients at their own convenience to tune in to the latest analysis in concise form.

In a similar vein of focusing on client needs during this difficult past year, the bank not only made the booking of FX rates easy and convenient via its online banking platform and mobile application for FX spots and forwards, but also enabled the customisation of spreads and limits according to different client segments. In tandem with this, it developed a tableau dashboard for better customer analytics for its advisory team and extended it to its transaction banking team to capture otherwise missed opportunities. One such notable example is Singapore dollar remittances overseas and, with the analytics capability, OCBC Bank can capture all flows requiring FX – onshore or offshore.

As part of this overall operational push, OCBC Bank’s appointed overseas office framework serves to facilitate cross-border settlement of permissible trade and Malaysian ringgit (MYR) assets transactions between a non-resident entity and a Malaysian-resident entity. Consequently, the scale and scope of these MYR-centric transactions have progressed from vanilla buy MYR spot deals to transactions allowing buy and sell MYR deals in spot, forward, swaps and FX options forms.

 

OCBC Bank was named FX house of the year, Singapore at the 2022 FX Markets Asia FX Awards.

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