Metrobank / CLSSettlement
Executive Vice President, Operations Group Head
Metrobank
Metrobank became the first Philippine bank to access CLSSettlement as a third-party participant in February 2020, through UBS, a CLS settlement member.
The Metropolitan Bank and Trust Company, commonly known as Metrobank, is one of the largest banks in the Philippines. Established in 1962, it offers a wide range of services to large local and multinational corporations, middle-market and small and medium enterprises (SMEs), high net-worth individuals and the retail segment.
As part of its efforts to comply with the FX Global Code of Conduct (the Code),1 Metrobank wanted to implement global best practices and mitigate their foreign exchange (FX) settlement risk.
Market challenges
FX volumes continue to increase globally, with the Bank for International Settlements (BIS) reporting average daily trading volumes of USD6.6 trillion in 2019. In particular, the rate of growth in emerging markets FX trading has been steeper than in G10 currencies, rising from 19% to almost 25% of global turnover since 2016. FX trading in the Philippines grew 46% between 2013 and 2019 compared to the overall Asia Pacific region, which grew 23% over the same period.2
Against this backdrop of increasing FX activity and a global move towards adopting best practices across the FX market, Metrobank identified increasing settlement risk associated with their G10 currency trading and proactively sought to mitigate this risk by adopting CLS’s global payment-versus-payment (PvP) FX settlement system – CLSSettlement – through settlement member bank UBS.