The German bank performed well across the market, taking first place in interest rate swaps, overnight index swaps and cross-currency swaps, and appearing in the top five of almost every interest rate category. But JP Morgan was close behind Deutsche, with 9.5% of votes compared with the winner’s 10.6%. Goldman Sachs took third place with 9.1% of the overall vote.
Michele Faissola, head of global rates at Deutsche Bank in London, foresees the market continuing to consolidate around the big players. “I expect many vanilla products in the financial institutions arena to follow the life cycle experienced in the foreign exchange market, where you had a period of lots of new entrants, which was then followed by huge consolidation. Now, the top three players own more than 50% of the market.”
JP Morgan dominated credit derivatives, taking overall first place in both credit default swaps and structured credit, as well as a first in exotic currency options and interest rate swaptions and caps/floors.
Guy America, London-based European head of credit trading at JP Morgan, said frenetic activity in the leveraged buyout market this year has made clients more aware of the benefits of credit derivatives, which in turn has led to increased trading activity at the investment bank.
“Current users of credit derivatives have had more occasion to use them in the ways they know best, while non-users of credit derivatives have become more aware of the benefits of the product,” he said.
Also performing strongly were UBS, which slipped from third to fourth despite a strong showing in currency products, and Barclays Capital, up from seventh to fifth with improving results in equity, along with a good performance in interest rates and currency.
Over a thousand dealers and brokers contributed to Risk’s 2006 interdealer survey. The full results, and a detailed analysis, are printed in the September 2006 issue of Risk and will be available to subscribers on the risk.net website Click here for the result