World’s Best Investment Banks 2020: Derivatives

Citi relies on solid team strength and a complete suite of products to satisfy clients, while SocGen shuffles its team and BNP buys into markets.

The derivatives markets of 2019 represent a stark contrast from the markets seen in the first quarter of this year. According to data and analysis in the Bank of International Settlements’ quarterly report from the end of 2019, daily foreign exchange volumes stood at $6.6 trillion last year. Spot, forwards, and options trading in foreign exchange markets rose almost 30% from the last foreign exchange survey, in 2016. Daily interest rate derivatives trading also soared, reaching $6.5 trillion.

The future, however, is murkier. It seems likely that choppy waters lie ahead. “2020 will be the year the rubber hits the road for some of [the derivatives industry’s] issues,” Scott O’Malia, CEO of the International Swaps and Derivatives Association in a year-end letter to members. “Whether benchmark reform, initial margin requirements or local implementation of revised Basel rules, industry efforts will have to step up a gear.”

One bank stepping it up a gear is Citi, named Global Finance’s 2020 Top Investment Bank for Credit Derivatives. “Coming out of the financial crisis, the credit derivatives business is something we always wanted to be a part of, and we knew we wanted to be a meaningful player in every part of the credit derivatives market. Especially here, we saw continued client activity and demand from clients for dealers to provide continued liquidity,” says Vikram Prasad, Citi’s global head of Flow Credit Trading. “We’ve maintained a presence in the structured derivatives products and we’ve always had a very active ‘repack’ note business, where we repackage derivatives risk to solve our clients needs around the world.”

 He further added that Citi has been in the business for quite some time, and has a team that has matured together. “We were able to build a best-in-class team and maintain a dominant credit franchise. We’ve groomed a talented bench, as people have moved to other roles at the bank or moved on outside of the bank.”

Societe Generale took the top spot for Equity Derivatives in this year’s Best Investment Bank awards. The bank underwent a significant restructuring, with cost savings efforts that cut 1,600 jobs—many of them in the investment banking division—saving €500 million ($557 million). 

Societe Generale announced the appointment of James Masserio and Salim Nemouchi as co-heads of Equities and Equity Derivatives in the Americas, replacing Hatem Mustapha, who was promoted to head of Global Markets for the Americas. Masserio previously held the position of Head of Equity Derivatives Trading, Americas at the firm. He joined Societe Generale in December 2017 in New York as the Head of Equity Derivatives Trading in the Americas. Nemouchi served as head of linear trading within the organization’s equities and equity derivatives group for the Americas. Nemouchi joined Societe Generale in 2004 in Paris where he started as Trader and then Head of Desk within the Structured Equity Finance team.

As co-heads, Masserio and Nemouchi will directly oversee all equities and derivatives trading and sales activities in the Americas. Their focus will be on growing the equities and derivatives franchise in the Americas in line with the bank’s strategy of expanding its investment solutions business, further developing its financing activities and optimizing its flow business.

And to put icing on the cake of its services, this past year, SocGen Corporate and Investment Banking (CIB) created the “Hedge to Pledge” initiative, which allows clients to contribute to social organizations based on foreign exchange transactions executed with the bank.

According to full-year results for BNP Paribas, Global Finance’s pick this year as the Best Bank for Interest Rate Derivatives, as of December 2019, revenue from its Corporate and Investment Banking unit revenue, at a total of €12.08 million, had risen by 11.6% compared to 2018. The bank also announced that CIB generated €3.2 million in pretax income, up a sharp 19.6%, reflecting solid growth in business combined with the success of its transformation.


Best Bank For Equity Derivatives Societe Generale
Best Bank For Credit Derivatives Citi
Best Bank For Interest-Rate Derivatives BNP Paribas