From Bloomberg, Reuters, or other systems Blades International can determine precisely—down to the minute—what the Interbank market has been on a historical trade. Most Middle-Market or smaller clients do not typically know their FX Markup. We are able to take your latest 3, 6, or 12 months of FX rate history and determine how much your bank has marked up your FX prices.
The rate is either set by a Foreign Exchange Trader when you call on the phone, or, if you use a bank online system, a formula to arrange a Markup based on various factors. The factors determining your FX rate include (1) the amount of the FX purchase, (2) your bank relationship, (3) how much volume you typically do, and (4) the specific currency, and other market factors. With our understanding of banking and how banks set FX markups for good clients Blades International can help you get what will be a Good markup for you and a Fair Markup for the bank.
You can learn the facts of the Markups and help your Manager learn how much the bank earns on your FX. It is good to know your costs and what your bank earns. This information can help your business save money in the long-run.
The FXRI Service is meant to ensure you are receiving fair markups, which will save your business money. Blades International has saved as much as 85% for some clients. Those banks gave great service and execution and then charged full Retail FX Markups. The service can also be a part of a “process improvement” plan to help companies become more efficient and save money.
Additionally, knowing how much your bank makes on FX transactions will help negotiations going forward. The more a client knows about how banks make money the better off in negotiating.
As banking services transition into the digital realm, it is important for companies to get in the habit of knowing their bank’s rates. We believe more FX trades will be electronic and fewer will be with traders in the future--this makes it even more important to know you’re Markups.
Blades International typically charges a fee to be mandated for review of the past year's activity. Then over the next year Blades International earns a percentage of the Proved Savings based on the trades that are monitored for Foreign Exchange Rate Integrity® on a monthly or quarterly basis. At the end of the first year period we can establish a modest maintenance agreement or the Client can ask us to periodically check the rates. This service is known as Foreign Exchange Rate Integrity® Auditing. Alternatively, a client can go forward with what we have arranged and taught them without any further cost. Accordingly, the client can have a Payback on the Fees they pay of about 4 months. In turn, they get the Savings for years continuously.
Blades International estimates a client will typically earn back, by FX Savings, what was initially paid upfront within weeks. Within about four months the client will have Saved enough to cover all the expenses incurred for a year and the Savings should continue perpetually.
The time stamp is client data and is a “stamp” of the exact date and time an FX deal was done. The Bank should provide that information or make it readily available. If the client cannot see or get the Time Stamps, and is a good client, that does Foreign Exchange purchases through a bank’s automated system, that is a Red Flag! You want to talk to your Relationship Manager and tell them that you need the time stamp data.
In order to provide you with a FREE assessment, Blades International will only ask you for a sample of your FX Transactions with the rates and time stamps. We like to use the KISS method - ‘Keep it Short and Simple’. There is no need for us to see more about your business than just the FX rates and the dated timestamps.
Blades International will give you a report on your historic markups and analysis of your FX relationship. The report will highlight issues unique to your FX purchasing patterns and recommend a range of structured or tiered pricing agreements.Blades International will either negotiate directly with your bank or coach on how to negotiate the arrangements for good FX Markups. Blades International will then follow through to monitor the Bank FX Markups for Foreign Exchange Rate Integrity®.
If the Bank varies from the structured price, Blades International will investigate why the FX Markup was high, or off the agreed structure. If the Bank made a mistake Blades International can help show the facts and the data to obtain a refund from the bank to make sure the Bank honors the agreement.
If Blades International finds a client has historically good Markups, our work is done! It will be good for you to know you have good Markups and you could thank your banker and let them know you are watching. We would hope to stay in touch to periodically help you check should your FX volume grow, you suspect the FX markups have changed, of FX Markups in general continue to decline.
The Chief Financial Officer, or the CEO, is ultimately responsible for the FX Markups. However, it is often the case that handling FX Wire Transfers are delegated to a cash manager or an administrative officer. The responsibility for the FX Markups can often be lost in the organization. Blades International is happy to talk to your bankers in a very diplomatic way. However, each client has a customized solution and you may decide it is best Blades International stay in the background as a Confidential Financial Advisor.
If a client decides they no longer want to continue their relationship with their bank after Blades International provides the FXRI service, Blades International can assist. BII has a number of bank relationships and can show various attractive FX Provider alternatives.
Wikipedia defines the FX Scandal as follows: The forex scandal (also known as the forex probe) is a financial scandal that involves the revelation, and subsequent investigation, that banks colluded for at least a decade to manipulate exchange rates for their own financial gain. Market regulators in Asia, Switzerland, the United Kingdom, and the United States began to investigate the $5.3Trillion–a-day foreign exchange market (forex) after Bloomberg News reported in June 2013 that currency dealers said they had been front-running client orders and rigging the foreign exchange benchmark WM/Reuters rates by colluding with counterparts and pushing through trades before and during the 60-second windows when the benchmark rates are set. The Behavior occurred daily in the spot foreign-exchange market and went on for at least a decade according to currency traders.
The fines Banks have paid for FX manipulation have been in excess of $15 Billion to date and have brought a lot of attention to this issue. However, banks still make good margins and have carefully in fine print made various disclosures about FX activity.
Simply share your FX rate data, including the time, date, rates, currencies and volumes. We will provide you with free indications of your markups. Please do NOT send confidential account or payee information.GET A FREE FX RATE REVIEW