Swiss digital bank sees ample opportunity in Asia
Swissquote launches a branch in Singapore this year and is expected to gain a capital markets licence before the end of this year
In 2018, Swiss online financial and trading services bank Swissquote announced plans to establish a business hub in Singapore. It has since launched a branch in the city state and is expected to get a capital markets licence before the end of this year.
The Asset (TA) recently caught up with Swissquote CEO Marc Buerki to learn about his firm’s expectations for the new venture.
TA: Marc, Singapore is already home to several online financial and trading services. What will differentiate Swissquote in the market?
Buerki: In our analysis, we asked the market participants, such as external asset managers, what challenges they are facing in their current business, and what changes they would you like to see to help them grow?
The response was that there is a clear demand to move to a more digital, direct access custody and trading model which the incumbent providers (the large global custody banks) do not provide today. Swissquote will bring a number of solutions to our partners to address this.
For example, we give direct access to our platforms for trading all asset-classes in real time in over 60 global markets.
Our partners (and in turn their clients) get the ability to trade via PC, tablet and smartphones. We provide the flexibility to trade when they want and from their preferred channel.
We also provide full middle and back officer services, which are automated on our platform, which means partners do not have to build large operations teams and can focus their time on meeting their clients.
TA: Do you think you are late in entering the market in Asia?
Buerki: For a number of reasons, we believe this is the right time for Swissquote to enter the Asia-Pacific market. Our Singapore office will lead our global custody and multi-asset trading services for the Asia-Pacific region, acting as a booking centre for the region.
We have spent the last two years analyzing the market, speaking to market participants and target clients, many of which have actively asked us to come to Singapore.
We have also invested a large amount of time and capital in the upgrade of our institutional and B2b Asset-Manager platform, which we are releasing onto the market in 2019.
Our target clients for the office are accredited, expert and institutional clients, which are an established industry in Singapore and Hong Kong, so our view is now is the ideal time to enter and help facilitate the continued growth of this segment with our market-leading platform tools.
TA: Do you already have Asian-based clients with accounts at Swissquote you can now serve in Asian time?
Buerki: Yes, we do, they are currently being served by our teams in Switzerland and Dubai – however as with any market, to really grow the business and seize the opportunity you need to be “local”, close to the market and its participants, to be able to provide relevant products and services.
As mentioned earlier, many of our current clients and prospects have actively asked us to come to the market to be closer to them and we have already tailored our platforms for the needs of our partners in the Asian markets.
TA: What are your hiring intentions in Singapore once you get approval to operate here?
Buerki: Being a digital bank, where over 99% of our transactions are settled on a straight-through processing model, we don’t need the same level of human resource as a traditional bank.
This allows us to start with a relatively small but highly skilled team which is capable of growing a large business.
In alignment with local Singaporean labour rules, we will build a team with a core of key group talent and add to this talent from the Singapore market to provide the local knowledge and skills which are critical to execute our plans.
TA: Will you bring the whole suite of products and services to Singapore?
Buerki: The focus of the office will be the institutional and partner space. We are bringing our global custody and trading services to serve them.
As you may have read in our recent press release, as part of ensuring our services are aligned with our clients’ requirements, we are adding real-time access to the various asset classes across 14 countries in the Asia-Pacific in 2019.
This will then complete our global coverage as we already have full real-time coverage in Europe and North America.
TA: Looking longer term, will Hong Kong be the next foothold in Asia for the firm?
Buerki: We already have a successful operation in Hong Kong with an SFC type 3 regulated entity and a rep office with about 20 people in total.
An extension to a type 2 and 4 licence that would allow us to enter the equity and asset management business is actually under review.
The institutional and partner business will however be managed out of Singapore for the entire region.
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12 Jun 2019