Citi and HSBC automate FX prime brokerage novation with Capitolis

Capitolis launched its novation platform last year in partnership with major firms including Citi, HSBC, Brevan Howard and BlueCrest.

Technology provider Capitolis has onboarded the foreign exchange (FX) prime brokerage businesses at Citi and HSBC to its recently launched platform for streamlined novation and automation.

Citi and HSBC are the first FX prime brokers to go live on the Capitolis Novation platform, which aims to reduce the time it takes for FX options novations to complete to benefit both buy- and sell-side firms. The platform automates manual workflow in FX prime broking and bilateral trading.

“Citi remains focused on delivering industry-leading capital and operational efficiencies to our clients with robust scale and automation,” said Christopher Perkins, global head of OTC clearing an FX prime broking at Citi. “We are excited to partner with Capitolis since its inception to drive capital optimisation and reduce costs through automated FX options novation processing.”

The Capitolis Novation platform first launched in May last year in collaboration with major financial institutions such as BlueCrest, Brevan Howard, as well Citi and HSBC. Just prior to the launch, Capitolis also secured a $29 million investment as part of a funding round with Sequoia Capital and Index Ventures.

“Efficiency and transparency have always been at the heart of our Global Intermediary Services offering for clients,” Vincent Bonamy, global head of Global Intermediary Services at HSBC, commented. “The FX Prime Brokerage novation tool will provide access to liquidity and credit in the FX options market, while allowing clients to offset their positions across their network of banks.”

Capitolis was established in 2017 by the former CEO of EBS BrokerTec, Gil Mandelzis, former head of technology at Traiana Igor Teleshevsky, and Tom Glocer, formerly the CEO at Thomson Reuters.

“Citi and HSBC have partnered with Capitolis to be at the vanguard of establishing this industry solution for FX novation,” Mandelzis, CEO of Capitolis, added. “We are grateful for them for helping us bring it to market with their incredible support, technical expertise and collaboration to shape what we believe will be a meaningful solution to address a key constraint in the capital markets.”