Source: Business Wire
Tuesday, May 25, 2010 03:02 PM IST (09:32 AM GMT)
Editors: Business: Advertising, PR & marketing, Banking & financial services, Business services, Financial Analyst; Technology
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(BW)(WSD-GLOBAL-MARKETS)WSD India Launches Innovative Derivatives Technology Solution for Corporations and Institutions in Emerging Markets
Mumbai, Maharashtra, India, Tuesday, May 25, 2010 -- (Business Wire India) --
Risk-averse banks, institutions and corporations in emerging markets who have been contemplating an entry into the derivatives arena and setting up their in-house derivatives operation to harness hedging and trading business in derivatives can now outsource their derivatives business to New Zealand-based WSD Global Markets, following the launch of its new offering from its India offices WSD INDIA, headquartered in South Mumbai.
WSD has commenced its Indian operations in Mumbai, India through a separate Indian incorporated company and plans to expand rapidly its reach & presence in India to Delhi, Chennai, Kolkata, and other metros in the near future to meet the growing demands of corporate and financial institutions in India. WSD India will operate through an independent Indian incorporated company in its own offices mainly, but due to the tremendous demand in WSD's product offering many corporations and individuals are looking to become agents or franchisees of WSD India in being able to offer and distribute these derivative products.
Trading in derivatives specially FX and commodity derivatives can be a risky and capital intensive proposition that requires expert knowledge and skills for success. Putting in place the right processes and systems both for the front & back office, having an experienced team, call centres, etc. are critical success factors. Many medium and smaller sized banks and a number of non-banking financial institutions including corporations that have access to large client bases around the world are increasingly outsourcing these services to the experts, and any slight mistake or error can cause huge losses. To enable banks & institutions to rapidly launch these services with minimal investments & risks at the same time, providing a very high quality service to their clients, WSD INDIA, through its principle in NZ, WSD Global Markets, has launched a fully outsourced Derivatives Technology solution, for hedging and trading derivatives like crude oil, gold and FX and other such contracts, that sets out to provide a tailor-made package that runs in partnership between the two. This doesn't comprise the sovereignty of the companies in question, but simply links in the revenue streams for transparent share splits.
"Think of it as an extension of a Derivatives Division of the bank or institution that wants to outsource this function for trading and hedging in derivative contracts," explains Riaz Patel, Managing Director of WSD Global Markets.
"We provide a complete end to end solution starting from educating the institutions, their staff, and existing client base on these products, ensuring they start using these derivative products optimally, putting in place the front office and back office systems, and ensuring proper risk management processes are followed, and all of this can be done online using the institutions' current web and online presence.
"WSD is able to now deliver a unique turnkey solution that will quickly plug the Institutions' clients into this Derivative product seamlessly. This, coupled with global payments, foreign exchange back-up for clients, foreign exchange and commodity transaction processing, without the risk or the investment yet to the end client, the service will appear as if the institution or the corporation in question is providing the same. The solution provider here is not apparent to the public or client base.
"WSD also provides private branded partnership agreements, where banks and institutions gain the benefits of WSD's turn-key on-line foreign exchange (and derivatives) products and services, without the burdening costs associated with building and maintaining a sophisticated infrastructure.
"WSD's Outsourcing FX solution offers direct access to a diversified global payments product line to service all of your current and future customers' international currency needs. Our flexible state-of-the-art online system WSD Direct offers instant access to a full-service trading desk without substantial capital investments."
Mr. Patel says WSD has the advantage of being totally independent and would not be a competitor for the client bank or institution's customers.
Mr. Patel adds that such services have been provided generally by Partner Banks and there is a fear they may have access to confidential customer banking information, whether institutional or personal. This poses a threat not only to a customer's right of privacy but to the bank who must protect their customers' anonymity and the banks' assets from being directly or indirectly solicited.
Even if a bank has a correspondent relationship with a Partner Bank, the Partner Bank may not be able to offer customers' market leading rates of exchange that translate into less profit on the bottom line. The Partner Bank may also not be able to offer a full line of derivatives and FX services that customers require, once again putting those customers' entire business portfolio at risk of loss to a competitor.
Since WSD is not a bank or NBFC, it is not a direct competitor. WSD is a licensed, regulated, non-banking financial institution in the US, NZ, Thailand and other countries focused on derivatives brokerage globally, and also provides various solutions, including white label services, that value the sanctity of confidentiality and provide transparent value-added derivatives, FX products, and turn-key outsourcing solutions.
Mr. Patel stresses that the cost of creating a derivative processing environment (from a technical, compliance, back office and human resource perspective alone) can be enormous. As such, banks and financial institutions are under constant pressure to keep overhead costs to a minimum so they can focus resources on developing new profitable opportunities. On the other hand, there are many smaller institutions that do not have a Derivative or FX facility despite the necessity and demand. Their risks are different yet substantial. If clients need derivative services and their bank doesn't offer them, their clients will have no choice other than to patronize a competitor that does. The opportunity cost for the bank is not only the loss of a customer's business but the potential loss of their deposits and loans as well.
As a derivative and foreign exchange specialist, WSD provides unique, safe and sound solutions for institutions that offer FX, Commodity and metal derivative products, but whose costs are outpacing profits, as well as providing solutions for banks that do not offer such services yet, but need this as part of their product portfolio to meet client needs, fend off competitors and create new revenue streams.
Through outsourcing derivatives trading to WSD, banks and institutions can improve balance sheets, increase profitability, introduce new revenue streams, maintain client confidentiality and increase shareholder confidence. This has additional significance in emerging markets such as India, where many institutions have large client bases but don't have the wherewithal to enter into the derivatives business even if they have the capital resources. WSD is the perfect partner to start such a division or product for a company wishing to utilise this rapidly expanding business opportunity with minimal upfront investments and very little time.
Mr. Patel sums up the advantages from WSD's new offering:
- Increasing revenue and profits derived from "fee" or "free" based services
- Improving operational efficiencies and productivity levels by outsourcing administrative tasks
- Delivering new value propositions to customers to enhance business relationships
- Expanding service lines to capture more business from existing customers
- Achieving more competitive exchange rates through wholesale purchasing
- Controlling costs and maximizing investment capital - if cash is not tied up in capital expense, it can be reinvested in areas offering greater ROI
- Leveraging the Internet to streamline and automate FX products, services and processing transactions
- Acquiring industry expertise and expediting market entry
- Become a one stop shop for all your client needs, thereby strengthening your brand
- Enhancing account management through real-time management reports on the purchase, sale and trading of foreign currencies and income generated from each product.
With its worldwide headquarters in Auckland, NZ and offices in the US, UAE, Thailand and other parts of the world, WSD already manages such services for many institutions globally and is happy to now launch this service in India, coinciding with the opening of its first office in India.
WSD Global Markets is one of New Zealand's leading Derivative brokerage and Technology companies dealing in FX, Metals, and commodity derivatives including but not limited to Futures and options on OTC and spot contracts, and offers an end to end derivatives outsourcing capability. WSD's management team includes industry veterans and experts with over 100 years of experience in global FX, derivatives and technology.
CONTACT DETAILS
CONTACTS :
WSD Global Markets Limited
Michel Nilles, +91.98.20.04.75.44
PR Manager
info@wsd-india.com
www.wsd-india.com
KEYWORDS
MARKETING, BANKING, BUSINESS SERVICES, Financial Analyst, TECHNOLOGY
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