|By K Raveendran| The run-away success of Alibaba’s blockbuster IPO is seen inspiring other online players to take similar routes. Among the probable candidates is leading online trading and investment entity Saxo Bank.
“The IPO is one of the options the management has under consideration,” Jakob Beck Thomsen, CEO of Saxo Bank Dubai, told The Arabian Post. But he refused to commit himself on a specific time frame.
With banking services getting increasingly digitalized and automated, Saxo Bank sees its operating space hugely expanded. The first major player in the financial industry to integrate social banking, Saxo Bank feels it is ideally placed to help conventional banks adopt trading and investment strategies that meet their customer demands in the digital age.
Thomsen points out how globally the financial services sector is under pressure. “If you talk to CEOs of major European banks, they are now looking at outside players like Google, Amazon or Facebook as the biggest threat to their business, not other banks,” he says. With Apple getting into the payments business, the threat has become all the more severe.
“There is a strong need to digitalize and automate and Saxo Bank is playing a significant role in this. With our White Label and Institutional offering we are helping banks digitalize and cut away complexity and costs while improving offering and expanding revenue streams,” Thomsen says.
The white labeling business contributes as much as 40 percent of the bank’s total business. It has about 10 major customers locally and the international clients include Citibank and Barclays.
The power of social media has ensured that traders and investors now rely to a large extent on their peers rather than bankers, he points out. And they tend to consider financial advisors as mere sales people pushing the products of their respective banks rather than third party products that might be more suitable to the client. In such cases, a potential conflict of interest becomes very obvious.
According to Thomsen, Saxo Bank has untapped the potential of social trading, which allows clients to follow other successful traders and engage with them continuously on what they are trading in real time. The platform allows the traders to disclose on a voluntary basis the outcome of the trades as well.
There has been a paradigm shift in the functioning of the financial markets. Historically, only financial institutions had access to these markets and private clients faced serious restrictions. But internet has opened up the world markets to private clients who can now get real-time market information and execute live transactions.
Saxo Bank’s suite of online trading platforms allows clients to access the world’s major financial markets and trade a broad range of financial products, including forex, stocks, futures, options etc. TradingFloor.com is an interactive community for traders featuring financial news and analysis, market data and trade ideas from Saxo Bank’s research team and commentators. With over 26,000 members, TradingFloor.com now attracts 300,000 unique visitors every month, up from 45,000 visitors per month one year earlier.
In 2009, Saxo Bank became the first Scandinavian bank to establish a presence in the GCC region with the launch of its DIFC office. This year, the bank opened a branch in Abu Dhabi. With the latest opening, Saxo Bank is now present in 26 countries.
Thomsen says Saxo Bank is also developing new solutions for a broader range of institutional segments, enabling financial institutions to effectively service their clients through the bank’s trading platforms, infrastructure and back office services.