LeapRate Exclusive Interview… We’re pleased to speak today with Barry Flanigan, Head of Electronic Trading Solutions at IS Prime, to find out more about his views on the issues facing Retail FX brokers, and of course what’s going on with IS Prime.
LR: Hi Barry, and thanks so much for joining us today. First off, please let us know about your role at IS Prime.
Barry: I run the global team which principally manages and bridges the triangular function of client partnerships, liquidity management and technical solutions. We cover and support both the retail broker and institutional environment, which allows us to leverage off some naturally overlapping skills.
The team consists of 11 people across IS Prime, IS Risk Analytics and IS Prime Hong Kong. A current strategic goal of ours is to facilitate growth in the agency execution business – it is a relatively small proportion of our business but we are investing in people and technology in order to drive significant growth.
LR: IS Prime has recently announced some significant developments in your Agency Execution business including new products and key hires. What are your ambitions for this part of the business?
Barry: We’ve built our Agency Execution business by leveraging the strength and successes of the margin business in terms of technology, skillset and our exceptional tier 1 bank relationships. As demand from clients has increased, we’ve broadened our offering, improved our analytics and added human resources.
There is a definite quality gap in this space, and we feel there is a tangible opportunity for IS Prime to add a significant footprint in the industry by providing liquidity solutions to mid-tier and smaller banks, hedge funds and voice traders – replicating our leading position of the Prime of Prime business.
In line with these opportunities, we’ve added skilled resources to the team. Terry Gill, former Director of Edgewater Markets, is a significant show of intent for us and we have also appointed a Quantitative Analyst from State Street, who joins us this week.
These appointments have resulted in a restructure of the team to allow experts in key areas, such as technical solutions, client and business development or focused quantitative roles. This specialist approach means that we can efficiently cover each aspect of the business at the highest level, rather than having very good individuals yet torn across too many crucial business units.
LR: Is the retail broker side of the business growing at the same rate as the institutional business?
Barry: We are doing exceptionally well on the retail broker side and continue to grow. We’re proud of the success in Asia thanks to the IS Prime Hong Kong office and the high quality clients we have onboarded over the past year.
We’ve also significantly improved our liquidity analytics and LP relationships in the last quarter, which has assisted the record volumes. Liquidity, and most importantly flow management, is a strength of IS Prime and largely underpins why we are at the top of this market and have the pedigree of clients that we do.
LR: What are the biggest issues you see for retail brokers?
Barry: We’ve seen a lot of streamlining in terms of Liquidity Provision. I believe brokers are (finally) beginning to see the negative impact of having multiple LPs which splits resources and capital requirements, especially with regulations tightening across Asia Pacific and parts of Europe.
We definitely see a big difference between clients who partner with us exclusively and therefore send cleaner flow, which ultimately results in better execution and core pricing. Most of the largest STP brokers globally partner with IS Prime, which speaks for itself in terms of performance and dependability.
LR: What are your plans for your team moving forwards?
Barry: Being part of the global ISAM Capital Markets – with offices in London (IS Prime), USA (IS Risk Analytics) and Hong Kong (IS Prime Hong Kong) – has allowed for an increased economy of scale across our departments and locations.
This gives us a stronger offering for clients and an internally efficient ecosystem. We’re able to move skills around to create more client friendly partnerships or transition technical employees over to sub-departments to nurture their skills. As an example, we’re moving a US-based employee over to Hong Kong as he is best placed to look after the risk management requirements of our clients in Asia during their local hours.