State Street Corp. has developed a real-time trading system for institutional investors.
Global Link is designed to simplify foreign exchange, debt, and equity trading.
Bank officials said institutional customers increasingly are interested in the cross-border investing services this system provides.
State Street, based in Boston, has $3.8 trillion of assets under custody and $379 billion of assets under management. Its clients include pension and mutual funds.
Sources familiar with State Street's strategy said the service is part of an effort to retain customers that might be attracted to companies offering competing systems.
George K. Bird 4th, executive vice president at State Street, said Global Link's strength is the way it integrates a variety of trading services.
Its first module, called FX Connect, is already running with 60 institutional customers. It is a foreign exchange system that provides real-time electronic trades.
Mr. Bird said the FX Connect system lets institutional investors conduct seamless foreign exchange trades in real-time from the desktop.
"It's absolutely unique-no one else has this," Mr. Bird said. Large money managers still rely on telephones and faxes for their forex dealings, he said.
FX Connect offers money managers a look at the rates offered by competing banks. It would let both trading partners see forex transactions as they occur, using real-time exchange rates versus rates of the day offered by other banks.
The real-time information delivered by the system will "force us to be competitive," Mr. Bird said. A single point of access does not mean investors will have to trade with us, he said.
State Street officials estimated that $2 trillion in foreign exchange transactions changes hands each day, and the system gives the bank an opportunity to capture more of that market.
Global Link will be connected to the Swift network, a bank-owned financial messaging system, for communications between investment managers and custodians.
State Street also is developing a trade confirmation service and a system that enables money market investments in multiple currencies.
Another service under development, called Lattice, would let money managers conduct large-volume equity trades with multiple brokers at U.S.- and U.K.-based stock exchanges.
