As Germany’s largest corporate bank, Commerzbank is a significant financial contender with a broad reach spanning over 50 countries – which has contributed to the success of its FX division. Although the bank’s identity is rooted in corporate banking, its worldwide operations and the merger with Dresdner Kleinwort in 2009 further strengthened its position as a counterpart for financial institutions. “Commerzbank is at the heart of the FX movement, which partially owes to the fact that Germany has always had strong global trade relations and been a country at the forefront of the FX field,” says Gerald Dannhaeuser, Head of FX Sales at Commerzbank. “Although FX is deeply rooted within the DNA of Commerzbank, we are determined to continue adapting and developing according to the shifts in the market along with client expectations,” he adds.

What sets Commerzbank’s FX model apart from the competition? “Commerzbank’s FX offering is particularly suited to clients looking for a holistic approach who also want to leverage synergies across their FX exposure with interest rates and commodities,” explains Dannhaeuser. In FX, Commerzbank is thriving in the increasingly competitive environment. More so than ever, customers demand flawless and sophisticated services to help them in their quest to trade successfully. To keep ahead of the game, Commerzbank’s FX team invest a great deal in the development of this increasingly important business component. “Many opportunities have arisen at Commerzbank through ongoing investment into new technologies. In a bid to fulfil clients’ requirements, we dedicate a healthy portion of time and funds to the development of our FX capability; including time spent on enhancing our e-expertise and service,” explains Dannhaeuser.

The changing face of the FX segment
Keeping a close eye on the market is imperative for any strategic business, but those moving in FX circles should take extra care, as the segment tends to be fickle. The FX movement has taken many turns over the course of time, a host of new client categories have entered the arena, including hedge funds and retail traders – while the geographical footprint has widened considerably. These significant changes bring opportunities as well as challenges. Not slow to respond, Commerzbank has expanded its reach to welcome new client groups, and has also incorporated new trading shores into its FX recipe. “An important development over the past few years has been our expansion into Asia and this development follows the natural cycle that spurs the FX sphere,” notes Dannhaeuser. “Originally, Europe and the US were at the centre of the FX landscape, but when the euro was introduced, there were fears that the sector would be brought to a halt or at least slow down quite markedly. Now we know that the opposite is true, as new markets have added greatly to the field and presented traders with a wealth of new opportunities,” he adds.

Commander – the latest in etrading
Aside from broadening its reach to cover a string of emerging markets, the FX area has been subject to other significant changes too. A particularly notable development is the increasing focus on ecommerce assisted FX trading. “The advance of electronic trading is perhaps the most important trend to emerge in the past few years, and to cater to the growing number of e-inclined traders, Commerzbank’s electronic platform offers real time trading in FX and commodities, while we also run an open dialogue with our clients in order to establish what they value the most when trading electronically” says Dannhaeuser.

The hard work has certainly paid off; as a result of its continuous effort, Commerzbank has seen interest in its electronic offering growing exponentially in the past few years. To make that figure grow further, the bank is determined to provide a robust and reliable set of services along with a forward-thinking approach that will contribute to the future of FX trading.

A recent launch designed to make the trading landscape more rewarding for clients, is the new eFX platform, Commander. The enhanced eFX product has been built upon the current platform, Click&Trade FX, and has been upgraded in order to be more user-friendly and effective. The features that signify Commander include an expanded product range that benefit from improved multimedia support and real time event news, as well as tutorials, opinions and research. In addition, the platform boasts a number of new features including a new FX structuring platform called Kristall.

What makes this innovation significant? “Kristall is the first structured products platform of its kind, based on cooperation and price transparency” explains Enrico Ferrante, head of FX structuring at Commerzbank.

Crucially, the invention also allows financial institutions to establish or expand their own FX structured product capability without set-up costs. To assist this process, every tool imaginable is included in the service, each one conceived to ease the process of pricing and booking a product. Kristall trading partners are also afforded the benefit of sharing product pricing with colleagues or with Commerzbank experts, allowing them to access a pool of knowledge which they are free to share with their own clients.

Complete as it may seem, Commander is under constant development. “This is just phase one of the Commander platform,” explains Paul Scott, head of eFX Trading at Commerzbank. “Technological investment is increasingly important in the eFX world, and we will continue to develop our platform to by remaining in tune with our clients.”

This is a wise move indeed, since ecommerce is becoming an ever more important element in the FX market. Recent figures released by the Bank of England indicate that FX volumes have increased by 17 percent over the last year; Commerzbank has seen this reflected in the substantial upswing in users trading on its eFX platform.

A high level of transparency
Aside from keeping a close eye on the market and ardently fine tuning ecommerce platforms, Commerzbank’s emphasis on customer service is always at the top of the bank’s agenda. Commerzbank constantly strives to offer clients the best possible service and it has invested heavily in finding ways to do so. A recent initiative conceived to assist clients trading in emerging markets is the opening of a trading desk in China. Another beneficial aspect offered to customers is the availability of Commerzbank’s traders throughout the entire trading cycle, they are at hand starting in Singapore in the morning and finishing in New York late at night. “At Commerzbank, we know that it is paramount to meet our clients’ needs at all times,” asserts Dannhaeuser. “While customer service plays a significant role across the business model as a whole, we feel that it is particularly important to be accommodating in the fast-moving FX field. Complacency is not an option, and we constantly strive to offer clients – both corporate and institutional – a growing number of products and services.”

While regulatory transparency has always been paramount within financial transactions, there has been a surge in regulatory changes lately. Commerzbank has adapted to the new times well. “We strive to stay on top of the regulatory change and aim to react quickly when new enquiries and regulations surface. It’s in our interest to demonstrate regulatory compliance, as it serves us as well as our clients. Moreover, we’re looking for the best way to execute a deal and tackle longer term risks.” says Dannhaeuser.

Armed with a levelled approach coupled with creative know-how and a nose for FX, Commerzbank’s future looks bright.