Euromoney’s 2011 FX survey results

Deutsche Bank secures first place for overall market share for the seventh consecutive year. Barclays Capital has overtaken UBS in second place, while the gap between the top three banks and a chasing trio of Citigroup, JPMorgan and HSBC has narrowed, the survey shows. Until last year, the survey saw a handful of leading foreign exchange banks increase their market share. That trend started to reverse in 2010 and has continued this year.

The top three banks in the survey accounted for 36.98% of the total market in 2011, compared with 40.44% in 2010. The share of the next three has increased from 20.55% to 21.57%. The market share for the top 10 FX providers was little changed at about 77%.

The next tier of banks has performed well this year. The market share of banks ranked from 6th place to 10th place increased from 22.54% to 25.03%.

Of the most significant movers in this year’s survey, HSBC registered the biggest improvement of the top 10 banks, increasing its market share from 4.55% to 6.26%, followed by Citigroup, up from 7.69% to 8.88%.

Another feature of this year’s survey was the higher number of respondents, 13,039, up 11.4% on last year, which indicates the importance of survey to the world’s major FX providers. Five years ago, the survey had 6,101 respondents.

Electronic trading is also up, volumes increased by 25% over last year, and now accounts for over 56% of all foreign exchange business.

The share of the top three banks’ e-platforms (Deutsche, Barclays and UBS) fell from 58% to 41%; while the share of banks ranked from 4th to 10th place rose from 27.62% of the market to 41.04%.

These results suggest that the positions of banks that took an early lead in e trading may not be as entrenched as is widely believed. As other banks look to produce e-platforms that match those of the market leaders, competition is likely to become fiercer.

The top 10 banks overall in this year’s survey are as follows:

Outside the top 10, other banks made big strides forward. Nomura continued its progress, improving 4 places to 14, the biggest organic increase in market share overall compared to last year. Other Japanese banks showed similar improvement. Mitsubishi UFJ rose three places to 19, while Mizuho Financial Group leapt 11 places to 23. Australia’s Macquarie Bank showed the biggest improvement, rising 41 places to 43 on the table.

Volumes recorded by the Euromoney survey rose this year from $167.3 trillion to $177.6 trillion, reflecting more active markets, especially around the European sovereign crisis, and increases in high-frequency trading.

More information on the foreign exchange survey, including previous results

 

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