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Electronic Execution Department of the Year, Sellside
Bank of America Merrill Lynch
Under the leadership of Natan Tiefenbrun, who joined in 2013, and Tony Walker, the US bank’s European electronic franchise has continued to gain market share over longer-established rivals. It was the third-ranked European equity algorithmic broker, according to Greenwich Associates’ 2015 survey, up from fifth in 2014. It was also the top-ranked firm in IHS Markit’s survey of firms as measured by the value of equity business executed on behalf of clients during the first half of 2016. The amount handled by the bank was €1.17 trillion, helping to push it above Morgan Stanley for the first time in the survey’s history.
The US bank was once regarded as a laggard in electronic institutional stockbroking, but it is now firmly established in the top tier of electronic providers. Clients say the bank has benefitted from being a latemover, helping to give its a technology an edge over rivals. The bank has sought to distinguish itself by taking a highly analytical and transparent approach – offering customisable services, detailed analysis of different trading venues and walking clients through each individual execution.
Market maker and agency broker KCG is still an emerging presence on Europe’s electronic trading scene, but its July 2016 acquisition of Swedish broker Neonet was a sign of its ambitions for growth in the region. As an execution-only specialist it is well-suited to Mifid II’s unbundling provisions forcing investors to choose brokers based on the quality of their trading service alone. Its EU agency broker, headed up by Rob Crane, has rolled out several new algorithms which utilise the intellectual capital of the firm’s market making teams, helping to drive an uptick in volume from top tier institutional clients. The firm has also made multiple key hires across the trading and client facing businesses and is now directing its attention to further expanding its global footprint in ETFs.
Morgan Stanley’s electronic trading franchise, led by Rupert Fennelly and Kevin Twitchen, has maintained its gold standard status throughout the year. The US bank topped the IHS Markit broker rankings for a fourth successive year in 2015, which measures the value of equity business conducted on behalf of European clients. Its dark pool operations are among the largest in Europe by value of shares traded, according to analysts, and the regulatory status it adopts for the venue under Mifid II’s tough new rules on dark trading will be closely watched by others in the industry.
UBS has long been regarded as one Europe’s pre-eminent electronic trading houses, but it has not stood still. In an effort to create a more consistent offering for clients the bank created a new global team in August 2016 it termed Equity Electronic Agency Trading, which has been given dedicated tech support by the bank. The unit brings the bank’s electronic equities services under one umbrella including Quant HQ, the bank’s quantitative trading unit, and SwapDirect, a platform for algorithmic trading of US equity swaps – as well as trading of exchange-traded derivatives.