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“We need technology,
but voice trading will
remain essential.”
year, with second-quarter revenues
declining 17.4% in the second
quarter versus the previous year.
The bank cited weak rates business
in Europe and unfavourable market
contexts in foreign exchange and
credit, but it was by no means
alone: Seven of the 13 banks
sampled by S&P Global Market
Intelligence reported lower FICC
revenues in the second quarter.
Still, BNP Paribas was ranked num-
ber one for all bond issues in euros
in the first half, and number eight
for all international bonds.
Couellan wouldn’t be drawn on
market outlook issues. The bank,
however, takes a sanguine view
of the emerging markets crisis
that has hit Turkey and Argen-
tina, implying that volatility, the
lifeblood of FICC, may not be set
for a dramatic rebound any time
soon. BNP Paribas does not expect
a prolonged period of contagion for
emerging markets; indeed, given
the value on offer a “compelling
buying opportunity” exists for
emerging fixed income assets. The
relative lack of volatility that has
hampered FICC trading in recent
years may be with us for some time
to come then.
FICC, in fact, has not been a
growth industry for a long time. Fol-
lowing the financial crisis of 2008,
many banks scaled back FICC desks
due to tighter regulation, higher
operating costs, and a shrinking
revenue pool. In its 2018 Banking
Industry Outlook, Deloitte predicts
that global FICC revenues this
year will be broadly stable. But the
medium-term future for FICC may
be brighter. Deloitte argues that
24 // TheTrade // Autumn 2018
C O U E L L A N ]
front-office technology innovation,
especially cognitive automation, has
the potential to bring efficiencies.
“Once monetary policy tightens
across global markets and volatil-
ity returns—there is no empirical
reason for it to remain as low as
it has been— we think that banks
that build the right capabilities and
make the strategic choice to ride out
near-term pressures . . . to stay with
the FICC business could see big
pay-offs,” Deloitte says.
Since 2017, Couellan has co-
chaired the International Capital
Market Association’s (ICMA) Sec-
ondary Market Practice Committee
(SMPC), a forum open to ICMA
sell-side and buy-side members
active in the cross-border fixed
income secondary markets. The
SMPC meets four times a year
to discuss market developments,
regulation, market practice, and
market functioning and liquidity.
Couellan defines his SMPC role as
the quest to collaborate with the
sell-side to find ways to make the
buy-side more efficient.
He gets a kick from trying to
understand the psychology of his
traders and of fund managers. He
wants his traders to be “proactive
on behalf of the clients”. They
are encouraged to suggest ideas
and timing strategies for a more
efficient trading approaches, with
Couellan challenging them to
review their trades, even the ones
that went well, from different
angles. “How could it have been
done better?”
FICC evolution
The profession has changed greatly
since Couellan started out in the
early 1990s. Electronic trading was
still a recent innovation then, with
the open outcry trading system
having been replaced in Paris in
1986. Couellan’s career has coin-
cided with the birth and growth to
maturity of electronic trading sys-
tems and his enthusiasm remains
undimmed. He would advise young
people starting their careers to
consider trading if they are curious
and motivated – and recently gave
such advice personally.
More quantitative skills are
needed now than in the past, he
argues, and that there is a great-
er need for traders to “play with
data”. Ever-advancing automation
means that trading won’t be the
easiest career choice, but “human
contact will remain one of the most
important things”. The increasing
levels of automation, and in turn,
introduction of robots, some-
times make people afraid, but the
challenge is to use automation to
do things differently: “There are
always new ways to be found.”
Outside of work, Couellan enjoys
playing golf and has a passion for
vintage cars and historical racing
events such as Goodwood Revival
or Le Mans classic. He says he
could do without the masses of
emails he has to manage and pre-
paring PowerPoint presentations
is a taste that he has yet to acquire.
The sense, though, is of a man who
is here because he wants to be.
He enjoys trying to make sense of
a dynamic market. “I like people
who like their jobs,” he says.
Four of his traders are women,
plus an intern: One of them is head
of money markets, and anoth-
er the head of convertible bond
trading. Gender balance is needed,
Couellan agrees, but the success of
a trader, he believes, is ultimately
determined by their level of indi-
vidual curiosity and commitment.
That word again: curiosity. It has
been the thing that has sustained
Couellan through his long career.
Einstein tells us that curiosity has
its own reason for existing, and
that the most important thing is
not to let it go.