Deutsche Bank
Deutsche Bank executes more than 630 individual interest rate derivative transactions in an average trading day; more than 50% of these are directly to end users of derivatives rather than through the inter-dealer market. The bank says it has consciously minimised its reliance on the inter-dealer market to focus liquidity provision on its clients – it makes consistent two-way markets in more than 30 currencies, across both flow and exotic products.
Michele Faissola, global head of rates, says: “Our core philosophy has been to develop best-in-class solutions on a global basis for our clients and, after several years of relationship building, product innovation and strong liquidity provision, the result is that we are able to price, manage and hedge any risk profile our clients are faced with.”
Deutsche is widely recognised as a dominant player in the euro market but has continued to drive its US presence, building on its $40bn 2001 hedging programme for FleetBoston Financial Corporation. It has executed more than $110bn notional of so-called elephant transactions – multi-billion dollar structured interest rate risk exposures. Deutsche also holds a 20%-30% share of the Japanese market in interest rate/FX hybrid products.
During the past 12 months, Deutsche Bank has launched the Xavex Dynamic Bond Portfolio – a joint venture with its equity derivatives division, the Brasil Interest Rate Swaption for hedge funds and an Asahi Bank RMBS hedge. The judges were impressed with Deutsche’s role as a liquidity provider, the geographic spread of its business, and its product diversity and innovation.
