An interview with CJ Gavsie and Blake Jespersen of BMO Capital Markets.
CJ Gavsie is the Global Head of Foreign Exchange (FX) Products at BMO Capital Markets. The FX team serves the comprehensive currency needs of BMO Financial Group’s clients, providing products and solutions across the bank’s global platform.
CJ is responsible for all aspects of the FX business at BMO, which has more than 90 professionals in 10 cities (London, Toronto, Montreal, Chicago, Milwaukee, New York, Guangzhou, Shanghai, Beijing and Hong Kong). BMO Financial Group is the fourth-largest bank in Canada and has operations around the world.
Blake Jespersen is Head of Corporate and Institutional FX Sales with responsibility for the bank’s largest clients in Canada.
How many markets do you currently operate in?
As well as our offices in key cities in Canada, the United States, Europe and China, we have important client relationships globally across these countries and regions as well as in Asia and Latin America.
Our objective is to offer FX dealing capabilities in the location of our clients’ choice and our recent expansion into Hong Kong serves that purpose. Through our presence in Hong Kong we serve the growing needs of our clients across many different products and services, including pricing in all major and minor currencies, both spot and forward. We have sales and trading offices in mainland China and Hong Kong which support the bank’s overall strategy in China.
When did BMO Capital Markets first establish the headquarters in China?
BMO Capital Markets has been trading FX in China since 2002 and we incorporated as BMO China Co in 2010. Our head office in China is located in Beijing and supports a wide variety of banking services across the region. Bank of Montreal, however, has been building relationships in China for almost as long as the bank has been in business. The bank undertook its first foreign exchange transaction in support of trade with China in 1818.
What advantage does BMO Capital Markets global presence offer investors and traders?
We offer both sales and trading services across all time zones, which means we can offer seamless, 24-hour service to our clients, regardless of their location. Our global reach also provides us with very good liquidity in all of the major currencies, which we leverage to deliver best-in-class execution and pricing to our clients. We are a leading provider of Canadian dollar FX products globally, so our clients come to us for our expertise in this currency.
What is eFXpedite?
eFXpedite is our single-bank platform which is used by our Corporate and Institutional clients for FX execution. It provides our customers with access to streaming rates and the convenience of one-click trading for spot, forwards and swaps.
You offer an online Banking for Business platform. How does this work and what are the primary advantages?
The FX Portal on our Online Banking for Business platform allows our corporate clients to conduct all of their daily banking activities in one convenient place, including meeting their foreign currency requirements and eliminating currency risks. Clients can access rates on 27 currencies and their related currency pairs, which they can then transfer between accounts, wire to suppliers/buyers, or send out via pre-set payment templates. For an added level of security, clients are able to set approval levels for system users including the ability to book trades, create templates, provide instructions and approve payments to ensure proper transfer of funds.
What impact has regulatory compliance had on operations?
We have made numerous changes in response to new regulation and the changing environment. We have exited certain businesses, changed our clearing structure to be compliant with Dodd Frank, and became compliant with Basel 3.0 guidelines at the start of fiscal 2013. That means that on both sides of the border, we capitalize, fund and price exposures using our best view of how Basel 3 will be finalized. There will be a natural adjustment period during this early adopter approach which may disadvantage us in the short term, but we continue to be able to generate attractive returns for our shareholders.
Our approach to compliance and risk is consistent cross-border and over time we expect broadly similar requirements in Canada and the U.S. While we do not believe that costs have reached equilibrium, we do believe that the growth rate of costs is slowing.
Are there any current Social Responsibility programs that BMO Capital Markets is involved with in China?
BMO Asia is working with Community Roots China on CSR, and we have participated in several local giving initiatives. Recently we participated in the One Heart Gift Bag program on World’s Children Day, where we purchased, packed and donated gift bags for children at a school in Hulunbuir, Inner Mongolia. Other CSR initiatives previously completed were the Terry Fox Run (Guangzhou) and the One Heart Gift Bag For Christmas 2012, among others.