BNP Paribas to Leverage GTS’ Trading Technology to further improve pricing to clients in the secondary market for U.S. Treasuries
This Strategic Collaboration Marks a New Era for Banks and Electronic Market Makers
NEW YORK, NY, November 16, 2017—BNP Paribas, a leading European provider of banking and financial services, and GTS, a New York-based global electronic market maker, today announced a strategic collaboration marking a new era for banks and electronic market makers. This collaboration will enable BNP Paribas to leverage GTS’ trading and technology capabilities with the goal of providing BNP Paribas’s clients with deeper liquidity, tighter spreads and further improved pricing in the US Treasuries secondary market.
BNP Paribas, with its strong presence in corporate and institutional banking and its top-ranked position in a number of fixed income and equity markets, and GTS, with its technology and electronic market making capabilities, will leverage their respective strengths to continue to develop the collaboration.
Under terms of the strategic collaboration, BNP Paribas will seek to improve the client experience by providing improved pricing in the secondary market for US Treasuries by the addition of GTS liquidity into its pricing framework. A dedicated team from both firms will leverage a mutually developed technology platform that seeks to provide BNP Paribas with access to greater liquidity, thereby enabling the bank to offer improved execution quality for clients as they trade directly with BNP Paribas.
Olivier Osty, Executive Head of Global Markets at BNP Paribas, said:
“The US is an important market for BNP Paribas, and we are fully committed to expanding our capital markets franchise by focusing on our clients and their demand for improved liquidity and better transparency. This innovative collaboration with GTS illustrates how we work with firms that are experts in financial technology to enhance our client offering across the Bank’s value chain. It is an important step in our ambition to become a leading digital capital markets house in the financial services industry.”
Ari Rubenstein, Co-Founder and Chief Executive Officer of GTS, said:
“This collaboration is a transformative moment for capital markets and reflects the next phase in the evolution of relationships between banks and electronic market makers, which provide investors with a low cost and more efficient trading experience. GTS continues to focus on innovative methods of providing more liquidity in more places by broadening access to our trading technology and building platforms for the future.”
About BNP Paribas
BNP Paribas is a leading bank in Europe with an international reach. It has a presence in 74 countries, with more than 190,000 employees, including more than 146,000 in Europe. The Group has key positions in its three main activities: Domestic Markets and International Financial Services (whose retail-banking networks and financial services are covered by Retail Banking & Services) and Corporate & Institutional Banking, which serves two client franchises: corporate clients and institutional investors. The Group helps all its clients (individuals, community associations, entrepreneurs, SMEs, corporates and institutional clients) to realize their projects through solutions spanning financing, investment, savings and protection insurance. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail-banking model in Mediterranean countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas as well as a solid and fast-growing business in Asia-Pacific. In the United States, BNP Paribas conducts securities business, including in US Treasuries, through its affiliate, BNP Paribas Securities Corp., a FINRA member that is registered with the US Securities and Exchange Commission as a broker-dealer.
GTS is a global electronic market maker, powered by combining market expertise with innovative, proprietary technology. As a quantitative trading firm continually building for the future, GTS leverages the latest in artificial intelligence systems and sophisticated pricing models to bring consistency, efficiency, and transparency to today’s financial markets. GTS accounts for over 3-5% of daily cash equities volume in the U.S. and trades over 10,000 different instruments globally. GTS is the largest Designated Market Maker(DMM) on the floor of the New York Stock Exchange, responsible for more than $12 trillion of market capitalization. For more information, please visit: GTSX.com.
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Denver and New York – Janus Henderson Investors (NYSE:JHG, ASX:JHG) today announced that BNP Paribas Securities Services, a leading global custodian with over $10 trillion in assets under custody as of September 30, 2017, will assume responsibility for the majority of Janus Henderson’s back office (including fund administration and fund accounting), middle office and custody functions in the U.S.
As part of this partnership, more than 100 Janus Henderson employees currently providing middle and back office functions in the U.S. will become employees of BNP Paribas. This continuity will support a seamless transition and consistent, high-quality service for clients.
Janus Henderson has a long-standing partnership with BNP Paribas outside of the U.S. with a strong track record of support and service delivery. This outsourced model will provide a single and consistent global platform to support the global growth of Janus Henderson. The partnership will leverage the broader expertise of BNP Paribas to provide best practice and leading industry approaches to global regulatory and industry issues.
Andrew Formica, Co-Chief Executive Officer at Janus Henderson Investors, said: “The expansion of our partnership with BNP Paribas to include U.S. services is yet another benefit to clients resulting from the merger between Janus and Henderson. BNP Paribas has been an excellent partner since we began our relationship more than 15 years ago.”
Dick Weil, Co-Chief Executive Officer at Janus Henderson Investors, said: “We are excited to announce a partnership that supports the continuity of individuals providing these functions and is expected to provide a seamless transition for clients.”
Clients will benefit from BNP Paribas Securities Services’ expertise in back and middle office services. Janus Henderson fund shareholders will also benefit from lower administration fees and expenses, as a result of the reduction in overall operating costs associated with these functions.
This is an important strategic step for BNP Paribas, providing it with a proven U.S. mutual fund administration and accounting platform, and enabling it to expand its global fund servicing offering.
This partnership is part of BNP Paribas’ 10-year strategic build-out of the firm’s Securities Services business in the U.S., which began with the launch of global and U.S. custody in 2012. BNP Paribas is committed to growing its presence in Denver where one of the firm’s fund servicing hubs will be located.
Patrick Colle, CEO of BNP Paribas Securities Services, said: “We are delighted to further broaden our long-time partnership with Janus Henderson. This is a transformational opportunity for both our U.S. platform and our global funds business. We are now able to offer a complete multi-asset class, middle-to-back office solution, covering all major markets in the world, including the U.S.”
Claudine Gallagher, Americas Head of BNP Paribas Securities Services, added: “We are excited to expand our capabilities for asset managers in the U.S. through this partnership, and look forward to providing high-quality service to Janus Henderson and its clients.”
BNP Paribas will pay Janus Henderson net consideration of approximately $36 million for the operations upon closing, which is anticipated for March 2018.
About Janus Henderson
Janus Henderson is a leading global active asset manager dedicated to helping investors achieve long-term financial goals through a broad range of investment solutions, including equities, quantitative equities, fixed income, multi-asset and alternative asset class strategies.
As at 30 September 2017, Janus Henderson had approximately US$361 billion in assets under management, more than 2,000 employees and offices in 27 cities worldwide. Headquartered in London, the company is listed on the New York Stock Exchange (NYSE) and the Australian Securities Exchange (ASX).
About BNP Paribas Securities Services
BNP Paribas Securities Services, a member of the BNP Paribas Group, is a leading global custodian and securities services provider. Backed by the strength of the BNP Paribas Group, BNP Paribas Securities Services provides multi-asset post-trade and asset servicing solutions for buy- and sell-side market participants, corporates and issuers. With a presence in 36 countries and a global reach covering over 90 markets, its network is one of the most extensive in the industry, enabling clients to maximize their investment opportunities worldwide.
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BNP Paribas is pleased to announce the appointment of Donald (Don) Sutton as Head of North America Corporate Coverage. Don will be based in New York and report to Bob Hawley, Deputy Head of CIB Americas, Business & Head of Global Markets Americas.
Don will be responsible for expanding the Bank’s client base, building on the significant growth the platform has experienced over the past few years, and positioning BNP Paribas as a strategic partner to its corporate clients. Don will work in close partnership with BNP Paribas’ Latin American, European and Asian teams to cultivate the Bank’s ties with its globally strategic clients, as well as to develop its partnership with subsidiary Bank of the West. He will take over the department from Richard (Rick) Broeren, who retired a few months ago.
Speaking about Don’s appointment, Jean-Yves Fillion, CEO of BNP Paribas USA* and Head of CIB Americas, said: “Don’s extensive expertise renders him extremely capable of building on the significant progress made with the Bank’s corporate clients to date, developing our sector focus, expanding our dialogue with strategic clients and growing our mid-cap footprint locally in conjunction with Bank of the West.”
Don Sutton added, “I am very excited to be joining BNP Paribas and looking forward to contributing to the continued growth of the Bank’s franchise in North America.”
Don joins BNP Paribas from Mizuho Bank, where he was co-Head of North America Corporate Coverage and responsible for growing the bank’s platform. Prior to that, he spent nearly 20 years at ABN/RBS in the US, where he advised its largest clients in the region and assisting with the integration of various acquisitions. Don graduated from St. John’s University and completed his MBA at Columbia Business School.
*BNP Paribas USA is BNP Paribas’ intermediate holding company that oversees its US wholesale and retail activities.
About BNP Paribas in the USA
BNP Paribas has built a strong and diversified presence in the United States to support its client base. The bank employs over 16,000 people and has had a presence in the USA since the late 1800s. Bank of the West and First Hawaiian Bank (together BancWest, part of Retail Banking & Services) serve nearly 3.5 million individual, wealth and SME clients through a branch network of more than 650 branches and business centers. Large corporate and institutional clients are serviced by BNP Paribas’ Corporate & Institutional Banking franchise that has a presence in the main US cities, in addition to a global reach through a network of offices in EMEA and APAC. The bank also offers asset management services through BNP Paribas Investment Partners (part of Retail Banking & Services) as well as Real Estate and Fleet Services through partnerships.
About BNP Paribas Group
BNP Paribas is a leading bank in Europe with an international reach. It has a presence in 75 countries, with more than 189,000 employees, including more than 146,000 in Europe. The Group has key positions in its three main activities: Domestic Markets and International Financial Services (whose retail-banking networks and financial services are covered by Retail Banking & Services) and Corporate & Institutional Banking, which serves two client franchises: corporate clients and institutional investors. The Group helps all its clients (individuals, community associations, entrepreneurs, SMEs, corporates and institutional clients) to realize their projects through solutions spanning financing, investment, savings and protection insurance. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail-banking model in Mediterranean countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas as well as a solid and fast-growing business in Asia-Pacific.
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BNP Paribas continues to be recognized for its leadership worldwide in Sustainability. For the second year in a row, the Bank was named the ‘Most Innovative Investment Bank for Climate Change and Sustainability” by The Banker magazine, and for the third straight year was listed in the Dow Jones World and Europe Sustainability Indexes.
In its 2017 Investment Banking Awards issue in September, The Banker praised BNP Paribas’ sustainable efforts, ranging from the supply chain finance program created for Puma to the World Bank’s first bond tied to the United Nations Sustainable Development Goals (SDGs). BNP Paribas also received specific mention on two U.S. transactions: Joint book-runner on $139mm green ABS by Solar Mosaic (led in Jan 2017 by our Global Markets teams) and Structuring of the 2016 Social Impact Bond for the State of Connecticut (led by CSR.)
The magazine said, “For the second year in a row, the French bank pick up the trophy for one of the most competitive categories. The depth and variety of its work that incorporates different aspects of socially responsible investing (SRI) has given it an edge over its rivals.”
Yann Gerardin, Global Head of Corporate and Institutional Banking (CIB), BNP Paribas said, “The bank has a dedicated sustainable capital markets team, but SRI principles permeate the entire CIB. Management requires every coverage banker to be able to speak with their clients, be it corporates or institutional investors, about sustainability.”
Meanwhile, BNP Paribas scored 86/100 in the annual RobecoSAM rankings included in this year’s Dow Jones World and Europe Indices – far surpassing the average score of the Banking sector at 58/100. With scores of 100/100, the Group has particularly performed well in risk management and climate strategy in favor of energy transition. The Group has also significantly improved its scores in the fields of the respect of Human Rights, the Health and Safety of employees and the Code of Conduct. Out of 274 banks, BNP Paribas is the first French Bank and one of nine European banks listed in these indices.
The Dow Jones World and Europe Sustainability Indexes evaluate the performance of the 2,500 largest companies listed on the Dow Jones Global Market Index against economic, environmental, and social criteria.
Marcelo Carvalho, Head of Emerging Market Research, Latam at BNP Paribas, wrote an informative article explaining the correlation between the U.S. dollar and emerging markets for CNBC.
The article, “As US stocks get slammed, these markets are primed for growth” describes 3 factors:
- Political turmoil and high stock valuations in the U.S. are creating an uncertain market for investors
- Global growth, low inflation and interest rates are creating a sweet spot for developing nations
- Emerging markets are taking off, with Latin America and Brazil in particular, leading the way
BNP Paribas today announced a settlement with the Board of Governors of the Federal Reserve System (“FRB”) relating to past misconduct in its foreign exchange business.
Under this settlement with the FRB, BNP Paribas will pay a fine of USD 246 million (approximately 215 million euros) which will be covered by existing provisions. This follows the announcement by BNP Paribas of a settlement with the New York State Department of Financial Services on the 24th May relating to the same issue.
In reaching this settlement, the FRB acknowledged the Group wide remediation initiatives and the full cooperation of BNP Paribas in the investigation.
The conduct which led to this settlement occurred during the period from 2007 to 2013. Since this time, BNP Paribas has proactively implemented extensive measures to strengthen its systems of control and compliance. The Group has increased resources and staff dedicated to these functions, conducted extensive staff training and launched a new Code of Conduct which applies to all staff.
BNP Paribas deeply regrets the past misconduct which was a clear breach of the high standards on which the Group operates.
Conducting its business in a responsible and ethical manner is a cornerstone of BNP Paribas’ values and the Group will continue to make improvements to ensure that it delivers on its responsibilities to all its stakeholders.
BNP Paribas is a leading bank in Europe with an international reach. It has a presence in 74 countries, with more than 192,000 employees, including more than 146,000 in Europe. The Group has key positions in its three main activities: Domestic Markets and International Financial Services (whose retail-banking networks and financial services are covered by Retail Banking & Services) and Corporate & Institutional Banking, which serves two client franchises: corporate clients and institutional investors. The Group helps all its clients (individuals, community associations, entrepreneurs, SMEs, corporates and institutional clients) to realise their projects through solutions spanning financing, investment, savings and protection insurance. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail-banking model in Mediterranean countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas as well as a solid and fast-growing business in Asia-Pacific.
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BNP Paribas today announced it has been named “World’s Best Bank for Corporates” for 2017 by Euromoney, the leading financial publication. The global accolade was one of six awards won in total by BNP Paribas, which also included the regional category “Best Digital Bank in Western Europe”.
Overall, BNP Paribas won the following awards:
- World’s Best Bank for Corporates
- Best Digital Bank in Western Europe
- Best Investment Bank in Belgium
- Best Bank in France
- Best Bank in Kosovo
- Best Bank in Luxembourg
For almost 50 years, Euromoney has been the leading publication for covering the growth of international finance. Over the past 12 months its coverage has included interviews with close to 100 bank CEOs, ministers of finance and central bank governors around the world. The awards were established in 1992 and were the first of their kind in the global banking industry. This year Euromoney received almost 1,500 submissions from banks in an awards programme that covers 20 global awards, more than 50 regional awards, and best bank awards in close to 100 countries.
Clive Horwood, Editor, Euromoney said:
“While many national champions retrench to their home markets, BNP Paribas is one of the few firms actively broadening its reach into new markets and new clients. Its profile as one of the few truly global corporate banks, alongside its commitment to digital solutions – including co-development with its corporate clients – is proving more suited than ever to the environment in which it operates.”
Commenting on winning “World’s Best Bank for Corporates”, Yann Gerardin, Head of Corporate and Institutional Banking, BNP Paribas, said: “The last 12 months have seen us accelerate the transformation of our business, the aim being to meet more needs, of more clients, more effectively. Euromoney’s acknowledgement of our progress is encouraging and a function of three factors: the support of the entire BNP Paribas Group; the commitment of our teams; and the trust our clients continue to show in us. This award – alongside the other five we have won – is recognition of their contribution, and my sincere thanks go to all.”
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How is BNP Paribas Corporate and Institutional Banking reinventing itself in the face of challenges posed by digital and tech? Constance Chalchat, BNP Paribas CIB’s Head of Change Management, recently appeared on BFM Business’ “Tech&Co” program in France for a debate on what the digital transition means for businesses and how BNP Paribas is reinventing itself and accompanying clients in this transformation.
BNP Paribas Securities Services, a leading global custodian, commissioned TABB Group to identify the technology trends shaping our industry
NEW YORK, June 20, 2017 – Custodian banks are embracing emerging technology like blockchain and big data analytics to help clients in their digital transformation, according to a new TABB Group report “Safekeeping Empowered: Reimagining the US Custody Business.”
Commissioned by BNP Paribas Securities Services, a leading global custodian, TABB Group’s research team interviewed a select group of sell-side senior executives (COOs, heads of operations and heads of technology) at mid-sized banks and brokers in the US regarding their technology priorities and their expectations from custodians.
“As a top five global custodian, staying ahead of market developments is crucial, so we worked with TABB Group to identify the technology trends that are shaping our industry in the US market,” said Bruno Campenon, Head of Financial Intermediaries & Corporate Client Line, BNP Paribas Securities Services. “The survey results validate that the advanced technologies we are already developing globally, such as distributed ledger technology and artificial intelligence, position us well to help our clients succeed in a changing digital landscape.”
Strategic Priorities of the Sell-Side
The priorities of the sell–side consumers of custody services, particularly mid-sized banks and brokers, are driven by the need to achieve value, comply with regulation, aggregate data and reduce costs. When asked about their most important technology initiatives, respondents rated cybersecurity (19%), the need for a client-driven user interface (19%) and data aggregation across the enterprise (15%) as their top priorities.
In addition to their technology development projects, respondents were also asked about their non-technology priorities. Regulatory compliance (22%) ranked number-one overall, with achieving operational efficiencies to create an automated operating model (20%) and data quality (15%) were also noted.
Looking ahead, over the next five years, respondents expect their own operational efficiency to be impacted most by blockchain and distributed ledger technology (66%), regulatory technology to help firms better navigate regulatory compliance (60%) and big data analytics (33%).
What the Sell-Side Wants
The survey also looked at what mid-tier sell-side custody clients are looking for from their existing service providers and how they believe custodians should be prioritizing new technology to advance their relationships.
When asked what is important when evaluating a custodian, the following ranked most highly: knowledge of the client’s business, easy-to-use technology, strength of balance sheet and reputation for innovation.
When selecting a new custodian, respondents focused on elevated levels of customer service (18%), value in return for their custody fees (18%), operational expertise (16%) and innovative technology offerings (14%).
When asked what specific areas of technology respondents wanted their custodians to invest in, cloud computing and storage where clients might migrate their own applications, digital identity or biometric technologies as part of multi-factor authentication methods to mitigate security risks, and distributed ledger technology ranked highest.
The Future of Custody
U.S. sell-side customers of custody services expect their custodians to keep up with emerging technology trends and automate wherever possible. When asked what aspects of securities servicing they would most like changed in the next three years, 34% noted an ease of regulatory constraints, while 27% noted automation of manual processing. Capital constraints (16%) and collateral optimization (13%) also rated.
“We found that the custody industry is set for transformation in terms of the technology they use, while the focus on customer service reigns supreme,” said TABB Group Senior Analyst Dayle Scher, who authored the report. “Adoption of automation for remaining manual processes, combined with better data analysis, are critical enablers of the high-touch coverage the sell-side so covets.”
An executive summary of the TABB Group Report “Empowering Safekeeping: Reimagining the US Custody Business” along with a 90-second video interview with TABB Group Analyst Dayle Scher and Bruno Campenon of BNP Paribas is available.
For more information or to purchase the report, contact firstname.lastname@example.org.
About TABB Group
TABB Group is the international research and consulting firm focused exclusively on capital markets. For 14 years, TABB Group has been helping business leaders gain a truer understanding of financial markets issues to develop actionable roadmaps and approaches to future growth. By accurately assessing their customer base, competition, and key market opportunities, TABB Group works with senior industry leaders to make critical decisions about their business. For more information, visit www.tabbgroup.com.
About BNP Paribas Securities Services (http://www.securities.bnpparibas.com/)
BNP Paribas Securities Services, a wholly owned subsidiary of the BNP Paribas Group, is a leading global custodian and securities services provider. Backed by the strength of the BNP Paribas Group, we provide multi-asset post-trade and asset servicing solutions for buy and sell-side market participants, corporates and issuers. With local expertise in 36 countries and a global reach covering 90+ markets, our network is one of the most extensive in the industry, enabling clients to maximize their investment opportunities worldwide.
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BNP Paribas has underwritten the Association for Financial Professionals’ (AFP) Executive Guide on Global Transaction Banking, which examines the issues impacting the decision-making process for treasurers in an uncertain business environment worldwide, including appointing new banks and managing existing relationships.
The below article from Craig Martin, director, executive programs and treasury practice lead for AFP, introduces and summarizes the guide.
By Craig Martin
Given the populist movements across the globe, in particular the Brexit vote in the UK, the Trump victory in the United States and the looming elections in France, conducting business around the world is becoming much more complex. Add to that potential trade sanctions and it gets even more difficult. So when a company operates globally, it is incumbent on its treasury group to provide adequate access to liquidity, and that requires maintaining sound banking relationships.
Managing relationships with transaction banks is a central part of a treasury executive’s role. Of all external partnerships, a successful set of bank relationships can have the most positive impact on the effectiveness of a company’s treasury department. Good bank relationships take time to build and nurture, but the investment in time will pay dividends.
The new AFP Executive Guide on Global Transaction Banking, underwritten by BNP Paribas, aims to help treasury practitioners navigate the process of initiating and managing a good set of bank relationships. The guide is structured in three parts. The first part reviews the current global banking environment. It outlines the pressures facing banks and explains why many of them have been reviewing their strategies over recent years. The second part has been designed to support the treasurer’s decision-making process when appointing new banks and managing existing relationships. It assesses the role banks play in supporting a global payments strategy and helps treasurers to identify and manage the counterparty risk associated with a set of global bank relationships. The final part of the guide assesses some of the factors that are already having an impact on the future of global banking. It addresses developments such as blockchain and identifies some of the ways these developments may affect bank relationships in the future.
As with other treasury activities, there is no single correct way to develop bank relationships and no ideal number of core relationships to have. The goal is to have an appropriate number of relationships, in which both the company and the banks achieve their own objectives through strong and collaborative partnerships.
Although there is general agreement that we face an unprecedented global banking environment, it is less clear whether this represents a “new normal” or whether we are simply experiencing an extended period of market upheaval. The first scenario suggests that the banking environment will be in a state of flux for some time to come. The second promises that the current period of uncertainty will come to an end at some point, although precisely when remains difficult to determine.
In a sense, though, it should not matter too much to treasury practitioners which analysis proves to be more accurate. The reality is that the wider global banking industry remains under pressure to reform and restructure their businesses. This will, in turn, continue to have implications for the way individual banks choose to develop their propositions for their corporate clients. For treasury practitioners, this produces a fluid banking environment in which it continues to be difficult to manage bank relationships, with the consequent uncertainty about both the range of products and geographic footprint of each bank.
Given this as a backdrop, managing bank relationships is a highly complex, while vitally important, task. There is no single template or formula to determine the appropriate number of bank relationships. However, it is possible to identify the key factors to help make good decisions.
- The first step is to evaluate your current relationships.
- Next would be to establish your overall banking requirements.
- Then try to standardize the processes as best as possible. This may be difficult as, for example, services common in one market are simply not available in other markets. This can be a result of regulation so that, for example, the availability of different cash pooling techniques can vary significantly between countries.
- And finally, try to identify a target number of key relationships.
In summary, the more the bank knows about a corporation, the better the relationship will be for both parties. Also, treasury needs to be strategically involved. The more the treasurer is focused on establishing good communications with the banks, the better their ability to react in the current rapidly-changing environment.
Download a complimentary copy of the AFP Executive Guide on Global Transaction Banking here.