Banks are starting to price liquidity by the hour
Finteum's Brian Nolan predicts that funding markets will eventually price more like electricity markets.
One of the clearest signs that funding markets are evolving is that platforms are beginning to introduce genuine price discovery in intraday funding.
Finteum is a London-based platform focused on helping banks manage intraday liquidity by allowing them to borrow and lend cash using intraday FX swaps. The platform, which originally started off focused on intraday repo, recently reached roughly $1 billion in weekly intraday FX swap trades, with major institutions including Goldman Sachs, UBS and NatWest increasing activity — a milestone that reflects growing demand for tools to manage funding continuously rather than overnight.
As Finteum Co-founder and CEO Brian Nolan told The Peg last week, “the price discovery happens on Finteum,” with trades negotiated between banks and then settled through existing payment systems.
The shift toward FX swaps rather than repo is not accidental. Part of the reason is practical.
