Bank of America turning Singapore into forex hub

Bank of America turning Singapore into forex hub

SINGAPORE (DPA): The Bank of America is moving to consolidate its regional foreign exchange trading in the city-state while leaving fixed-income security operations in Hong Kong, it was reported on Saturday.

Turning Singapore into its regional forex trading hub is expected to be completed by December, although not everyone in the Hong Kong forex office will relocate.

The decision "came out of a review of the whole forex operations in Asia," Steve Nutland, head of foreign exchange trading, told The Business Times. "It gives us a big global presence in Singapore."

Bank of America will expand its credit derivatives, fixed- income securities and sales business in Hong Kong.

The institution is the latest in a stream of banks which have considered their Asian forex and fixed-income operations in either Singapore, Sydney, Hong Kong or Tokyo.

Average daily forex volume traded here in the first eight months of this year came to US$98.3 billion, a 41 percent decline from the peak in 1997 coinciding with the Asian and Russian financial crises and the introduction of the euro.

Cross-border capital flowers are immense, Nutland said, with the driving force coming from the record number of mergers and acquisitions in Europe.

"The number of banks is declining because many have merged and the number of clients is lower but the size of transactions of much greater," he was quoted as saying.

ABN Amro Holdings NV, the largest Dutch bank, said last week it would transfer to Sydney its G-7 forex trading and its G-7 fixed-income operations to Tokyo from Singapore. Singapore remains the hub for ABN Amro's regional currency and fixed-income businesses.