From Russia’s invasion of Ukraine to disparate regulatory hurdles, volatility across Europe was high this year. But the region’s top execution firms were there every step of the way for European equities traders.
“Understanding the market structure in the region and the changing regulatory landscape remains a critical task for any bank,” said Brian Gallagher, head of cash equities execution EMEA for BNP Paribas Exane. “The potential divergence of the regulatory regime in the U.K. and Europe is a focus for our teams. On top of that, the ongoing conflict in the Ukraine and energy crisis will continue to make Europe an extremely volatile trading region.”
If you ask respondents to Institutional Investor’s 2022 Developed Europe Trading Team survey, BNP Paribas Exane has mastered these nuances. The European bank has once again been recognized as the top overall provider of execution and trading services in a ranking based on the opinions of more than 183 individual traders and portfolio managers across 151 firms.
Respondents were asked to rank the top trading services providers based on specific attributes for electronic trading, high-touch trading, portfolio trading, and delta one/ETFs. In electronic trading, for instance, respondents were asked to rank providers on algorithm customization and performance.
Scores for each attribute were aggregated together to create an overall top-ten leaderboard.
In the overall standings, UBS took second place, followed by Morgan Stanley in third. JPMorgan Chase & Co. took fourth, and Goldman Sachs ranked fifth.
In addition to placing first overall, BNP Paribas Exane was also No. 1 in high-touch, electronic, and portfolio trading. First place in Delta One/ETF trading, meanwhile, went to Kepler Cheuvreux.
Automation continues to reshape the relationship between sell-side firms and their clients, according to Gallagher. “We continue to see our clients look to automate parts of their order flow via electronic trading with dedicated TCA and electronic traders to allow them to focus on the larger capital intensive or liquidity constrained trades,” he said.
For BNP Paribas Exane Electronic Trading, Gallagher said this is a trend that plays into the firm’s strengths of a “longstanding investment into execution consulting and partnering with clients to improve outcomes and best execution.” Within the high touch business, he said, “the bank has been very supportive in helping us increase our risk profile to help clients with larger block situations. The combination of the two give us a best in class electronic and high touch offering.”
Gallagher cited the firm’s high-quality research as firm’s modus operandi. (BNP Paribas Exane ranked highly in this year’s All-Europe Research Team as well.) “Our high-quality research is at the core of what we do well at BNP Paribas Exane,” he said. “Knowing what drives the macro and micro, combined with the strength of our specialist sales teams, empowers our sales traders and traders to help our clients achieve better trading results.”
With the full acquisition of Exane complete as well as the investment BNP Paribas has made in Deutche Bank’s prime brokerage and electronic businesses, the firm is continuing to also build out its high-touch, electronic, and portfolio trading teams in the U.S. and APAC.
And more than two years since the onset of the Covid-19 pandemic, Gallagher observed that the business of trading and execution appears to be normalizing.
“While the pandemic has demonstrated that firms can adapt very quickly to work from home with minimal short-term disruption, longer term we have found that collaboration and physical proximity is key to our future success,” he said. “As we have emerged from lockdown we have found that clients are looking to meet in person and a return to the ‘old norm.’”