FX Markets

Société Générale Centralises FX In Singapore As Part Of New Product-Line Reorganisation

BANKS

Société Générale is centralising its Asian foreign exchange activities in Singapore as part of an overall move to a product-line organisation on the bank's capital markets side, according to Douglas Plant, SocGen's foreign exchange manager in Paris. He says that SocGen will be formalising the status of foreign exchange as a global product sometime later this year, when he will officially be named global foreign exchange director. Other parts of the capital markets group, such as bonds and swaps, are already treated as global products, he says.

At the end of last year, the bank broke up its dedicated options group, which had previously covered all markets, bringing traders in each market back into the departments trading the underlying cash product. SocGen's global FX options book now reports to Plant and his deputy, Benoit Ottenvalter, who has specific responsibility for options and supervises the three regional desk chiefs.

At the same time, the Asian leg of the global options book moved to Singapore from Tokyo, says Plant. The book is now passed from Paris to New York and then to Singapore, he adds. "Our main activity in options in Asia has been in Singapore," explains Plant.

The bank has appointed a new foreign exchange director for the Asian region, François Naude, currently the treasurer in Sydney, says Plant. He will move to Singapore during this year, Plant says, and will bring some traders from Sydney with him.

However, the bank will continue to maintain active trading in Tokyo, Hong Kong and Australia that will quote prices in specific currencies. "Tokyo will quote yen products and Hong Kong will quote mark/Paris, for example," says Plant. "However, Singapore will be the main centre and will quote all currencies." Smaller trading desks in such Asian centres as Seoul and Taipei will concentrate on sales, he says.

SocGen is moving to new quarters in Singapore in October, according to the bank's general manager in Singapore, Bernard Houtekier, which he says will include a new, larger dealing room. Plant says the dealing staff Singapore will be considerably expanded to handle "what we hope will be an increased amount of business."

SocGen is the latest in a line of international banks and investment banks that have moved their foreign exchange headquarters to Singapore in the last year or two to take advantage of lower costs, good infrastructure, well-educated and English-speaking traders and an increasingly liquid market in major currencies. Most recently, JP Morgan, Royal Bank of Canada and Merrill Lynch have chosen Singapore as their regional centres for FX, (FX Week, March 14, February 28).

Plant says that "in due course", the bank will also consider appointing separate regional managers for Europe and the Americas. That won't happen, however, until foreign exchange, as a new product line, "is established on an operational basis worldwide" later this year, he says.

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