Forex spot and futures platform EBS Trader goes live

The EBS Partnership today goes live with EBS Trader, its internet-delivered conversational direct-dealing system for spot and forwards foreign exchange, company officials told RiskNews ' sister publication FX Week . The service will compete directly with Reuters Dealing 3000 Direct, part of the UK information provider's Dealing 3000 range.

About 150 dealing floors, representing some 1,000 users, will go live today and EBS said it would continue to migrate other users from the beta site to the production site during the next two weeks.

EBS Trader is targeted at "any professional trader" and provides banks with an internal communication tool as well as bank-to-bank dealing.

The firm does not publish projected volume figures, said a EBS spokesperson, but take-up could be quite rapid, with beta-test bankers contacted by FX Week upbeat about the service’s functionality and ease of use.

Some market participants expect the firm eventually to combine EBS Trader with its existing spot-matching product – a scenario the EBS spokesperson did not rule out. "In theory, it could be a delivery method for spot matching," the spokesperson said, but added that it is not something the firm is actively pursuing.

The new product could bring EBS extra market share in addition to its successes with its spot-matching product, some market participants suggested. The existing service claims an estimated 60% of the total global interbank spot forex market, but is restricted in terms of the currencies it matches.

EBS Trader could provide FX trading access to smaller institutions that are less likely to pay for the expensive proprietary networks needed to install the spot matching system. Such a move could effectively bring about buy-side interest in EBS, especially if the two systems are eventually combined. EBS’s rival, Reuters, has already made its move into the growing market in buy-side forex with a number of new ventures, including a stake in forex portal Atriax.

EBS developed EBS Trader in conjunction with AVT Technologies, which created the front-end. The dealing system is based on the same architecture as AVT’s EchoFX online system, which is an off-the-peg solution enabling banks to trade foreign exchange with their clients via a private network.

The EBS consortium comprises 12 banks and the Minex Corporation – a former rival forex matching firm that the EBS Partnership acquired in March 1996.

The 12 partner banks are: ABN Amro, Bank of America, Barclays Bank, Citibank, Commerzbank, CSFB, JP Morgan Chase, HSBC Bank, Lehman Brothers, Royal Bank of Scotland, SE Banken and UBS Warburg.