Danske Bank and Swedbank have unveiled enhancements to their electronic trading capabilities, reflecting increased competition for algorithmic trading flow in the Nordic region.
In Denmark, Danske Bank has selected trading technology provider Fidessa to help develop its equity trading platform.
Fidessa will provide the technology infrastructure for Danske Bank's institutional trading desk, as well as supplying the execution platform for its retail flow. Danske Bank will be able to leverage Fidessa's low-latency direct market access (DMA) technology, combining connectivity and routing to multiple venues across Europe.
As part of the deal, Danske Bank will adopt Fidessa's managed enterprise model, which will provide the bank with access to a workflow platform delivered through a fully hosted infrastructure, run by Fidessa's own specialist team.
“Fidessa's deployment model gives us the flexibility we need,” commented Kim Lilmose, COO at Danske Markets, equities. “It delivers a high-performance platform that is both scalable and resilient while allowing us to focus on developing new services and making these available to our clients quickly and efficiently.”
Danske will be Fidessa's first managed enterprise client in the Scandinavian region. The vendor also has established a local hosting facility that will support Danske's proximity access to its domestic markets. Ian Salmon, head of enterprise business development at Fidessa, confirmed the growing demand for locating systems as near as possible to the Nordic exchanges, describing the deal with Danske Bank as “a firm blueprint for proximity hosting in the region”.
Earlier this month, Nordic multilateral trading facility Burgundy moved its matching engine to a new co-location centre in Stockholm to increase the venue's attractiveness to high-frequency traders.
Meanwhile, Baltic-focused bank Swedbank has added algorithmic trading functionality to its capital markets division, following an expansion of the firm's use of software provider SunGard's Front Arena cross-asset trading solution.
The introduction of SunGard's volume- and time-weighted average price (VWAP and TWAP) algorithms for use by Swedbank's client-facing traders in Stockholm and Helsinki, as well as alpha-seeking algorithms such as pairs trading, is designed to enhance Swedbank's trading and execution of equities and equity derivatives by supporting increased trading activity, monitoring execution and benchmarking execution.
The algorithmic functionality is designed to integrate fully with Swedbank's existing solutions.
“With SunGard's Front Arena, our traders are able to use trading algorithms in their daily execution to help improve their productivity,” said Claes-Urban Dackenberg, business enabling, Swedbank. “Front Arena also provides an open architecture that helps us cope with increases in trading volumes, adapt quickly to market changes and expand to additional regions or businesses as needed.”
Swedbank introduced the smart order routing module of Front Arena in April 2009.