Two entrants are setting up in Singapore despite Charles Schwab's announcement that it would cease operations in the city-state by year-end.

Interactive Brokers is one of two brokerages looking to start operations in Singapore from January next year. Known for its low-cost trading platform, the Nasdaq-listed firm received an approval-in-principle for a Monetary Authority of Singapore (MAS) Capital Markets Service license in September.

«We first looked into getting a license in Singapore more than 10 years ago but raised our priority for doing so over the past five years,» said Interactive Broker's Asia-Pacific managing director David Friedland, who was quoted in the «Business Times» (behind paywall).

Adding Headcount

Without disclosing client figures in Singapore, Friedland said that Interactive Brokers' Singapore-based clientele has been growing through reverse marketing and word-of-mouth. Its Singapore team currently has four staff, headed by Kevin Tan Kim Leng as chief executive officer.

Plans are in place to add a client service team, which Friedland said «could double numbers quickly». Meanwhile, Australian electronic trading platform, Yieldbroker, is actively marketing to prospective clients in Singapore and the region.

Focus On Fixed Income

Yieldbroker, which began operations in Singapore in August, targets institutional investors. It offers over-the-counter (OTC) interest rate exchange covering the primary, interdealer and dealer-to-client markets focusing on Australian dollar- and New Zealand dollar-denominated fixed-income securities.  

Singapore is the key fixed income hub in Asia; opening an office represents an important strategic move in our growth,» said Meha Thind, Yieldbroker's Asia managing director. The broker received its operator license from MAS on September 16 and is now actively marketing to prospective clients in Singapore and the region.

The online broker was conceived by Australian banks in the late 1990s to move the issuance and trading of bonds and derivatives to an electronic platform. In 2014, the Australian Stock Exchange (ASX) acquired a 49 percent stake in the fixed income broker.

War For Clients

Following in the footsteps of many giant brokers, Interactive Brokers this month launched a program for commission-free trading. Under IBKR Lite, investors can engage in unlimited, commission-free trading in U.S. exchange-listed stocks and ETFs. Trading in other securities is charged at a fixed rate.

Discount brokerage Charles Schwab Corp, Fidelity Investments and TD Ameritrade had eliminated commissions for online trading in the U.S. earlier this month to lure clients, due to increased competition from several fintech startups that offer quick and cheaper services. In a similar move, Bank Of America last Monday said it would expand its zero-dollar online trading to all customers of its Preferred Rewards program and cut commissions for others, «Reuters» reported.