Even before its introduction Tuesday, CFOWeb.com had generated a lot of interest among the corporate treasurers, fund managers, and chief financial officers it targets; 2,500 had already signed up.
The site's customers can research, price, and trade financial products that are not listed on stock exchanges. Such products include foreign exchange options, currency swaps, interest rate caps/floors, forward rate agreements, interest rate derivatives, loans, and deposits.
Its wide coverage sets CFOWeb.com apart from sites that offer similar functions for single products. TradeWeb.com, for example, supports bond trading, and Creditex.com, derivatives trading. Bondhub.com, which is expected to become available in the fourth quarter, is to support the trading of a variety of bonds and certificates of deposit.
CFOWeb.com aims to address the information overload plaguing portfolio managers. "Institutional investors really want more information on fewer sites," said Robert Iati, a senior analyst at Tower Group.
Five financial services companies - Bank of America Corp., ABN Amro, AIG International Inc., BNP Paribas, and Standard Chartered Bank - helped Integral Development Corp. of Mountain View, Calif., develop CFOWeb.com, and they now provide capital markets products for it.
CFOWeb.com announced the addition of three product providers Tuesday: Dresdner Kleinwort Benson, the investment banking division of Dresdner Bank Group, ING Barings, and Bank of Tokyo-Mitsubishi Ltd.
Portfolio managers who visit the site get free research, portfolio analysis, real-time market data, pricing, and trades. Product providers pay subscription and transaction fees.
Customers can scan the site for a specific product, make a selection, then get an offer specifying a proposed price and time frame - from two to 30 minutes - for closing the deal online.
The reverse-auction format, which mimics consumer Web sites such as Travelocity.com and Priceline.com, is the most successful e-commerce model, Mr. Iati said.
CFOWeb.com aims to mediate trading risk by assuring both portfolio managers and product providers of participants' reliability. Providers can prescreen investors and get access to full credit reports. They also can limit their exposures so that only investors with specific credit backgrounds are able to see the provider's logo as an option when pricing a trade, said Harpal S. Sandhu, president and chief executive officer of Integral Development.
Financial services companies are increasingly open to Internet trading, said Jim Kaitz, president and chief executive officer of the Association for Financial Professionals in Bethesda, Md. The association is a strategic partner of CFOWeb.com. In April it found that 46% of financial services executives use the Internet for financial transactions, up from 36% six months earlier.
The partnership with CFOWeb.com "has helped us as a bank," said David Woods, head of e-commerce at ABN Amro. "We have solidified our e-commerce strategy around CFO and made alliances with other portals."
