Awards: Kx Systems

Kx Systems has been voted Best e-Surveillance Provider at the 2018 FX Week e-FX Awards

Richard Kiel - Kx Systems - web.jpg
Richard Kiel: Kx Systems is adding products to make them more readily available to Tier 2 and regional banks

Prior to the flurry of scandals in interest rates and foreign exchange markets, trade surveillance was very much a compliance function. But as behaviour such as front-running, collusion and benchmark manipulation came to light, swiftly followed by regulatory initiatives such as the second Markets in Financial Instruments Directive and the Market Abuse Regulation, surveillance started to migrate towards the front-office.

“There’s still obviously a huge compliance focus. But one of the things we are seeing now is that there has been more interest coming from the front office as well as compliance,” says Richard Kiel, global head of FX solutions at Kx Systems, the winner of the Best e-Surveillance Provider category at the 2018 FX Week e-FX Awards.

Now, the focus is gradually shifting away from detection after the fact to prevention – a trend accentuated by the FX Global Code of Conduct.

“Chief operating officers, heads of desks and others in the front office are looking at surveillance solutions as well. From both a governance as well as a reputational risk perspective, they prefer not to deal with bad behaviour after the fact – they want to prevent that behaviour before it happens,” Kiel adds.

…one of the things we are seeing now is that there has been more interest coming from the front office as well as compliance
Richard Kiel, Kx Systems

There is also a growing emphasis on cross-asset trading, which, in turn, makes multi-asset surveillance platforms necessary. But, even in FX, factors such as the varying degrees of liquidity in different currency pairs and multiple platforms make surveillance difficult.

“A number of the large organisations we deal with who initially implemented surveillance capabilities for listed markets are now expanding into over-the-counter markets, which introduce their own set of challenges. This is essentially the next frontier in terms of the evolution of systematically monitoring the activity within the organisation,” Kiel says.

Reducing false positives

With surveillance tools becoming increasingly embedded in the front office, reducing the number of false positives is key. Artificial intelligence, machine learning and natural-language processing are all technologies that are emerging in surveillance solutions.

“It’s not difficult to raise an alert that something needs to be looked into, but supervisory resources are very limited across the organisation. Continued advancement in sophisticated data-mining techniques will ensure we are maximising the use of their time,” Kiel says.

As the team works to enhance their solution, he says that for the immediate future, Kx Systems will add products to its offering to make them more readily available to Tier 2 and regional banks.

“If it’s going to work for a Tier 1, it is more than likely going to be sufficient for other players in the market,” he adds.

VIEW THE LIST OF WINNERS

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact customer services - www.fx-markets.com/static/contact-us, or view our subscription options here: https://subscriptions.fx-markets.com/subscribe

You are currently unable to copy this content. Please contact info@fx-markets.com to find out more.

Firms seek optimisation gains as UMR and SA-CCR bite

A wider range of market participants is taking advantage of service providers such as OSTTRA’s optimisation cycles to drive margin and counterparty credit risk efficiencies across asset classes including FX, rates, equities, commodities and credit

Best FX overlay manager: State Street

In the most challenging market environment in many years, demand for State Street’s currency management offering spiked in 2022 as market participants sought assistance in minimising their FX risk and optimising their hedging activities

Best settlement initiative: CLS

Created 20 years ago to mitigate FX settlement risk, CLS continues to lead the settlement sphere with new solutions designed to meet the challenges of an ever-evolving FX market

Best single-dealer platform: Citi

To better connect its various FX solutions and allow its client base access to a broader set of markets, Citi has undertaken an ambitious project to consolidate its entire FX offering under its single-dealer platform

Best liquidity aggregation service: oneZero

oneZero’s technology helps market participants gain a better understanding of the market, as well as access to quality liquidity, better manage their risk and maximise the hedging potential of their FX portfolios

Best exchange for FX: CME Group

Following years of investment in its platform, CME Group has created an FX marketplace that provides market participants with a breadth of trading options that cater for myriad execution and trading styles and market conditions

FX house of the year, Malaysia: OCBC Bank (Malaysia) Berhad

OCBC Bank Berhad, the Malaysian subsidiary of the second-largest banking group in the region, impressed the judges with its agile and customer-centric multichannel FX offering, which allows clients access to the bank via a treasury dealer, its e-platform…

You need to sign in to use this feature. If you don’t have a FX Markets account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an indvidual account here: