Doing Swaps on The Web.

• Author: Marshall, Jeffrey
• Position: Brief Article

Not so very long ago, individual banks and other financial services providers could rely on relationships with corporate finance customers -- some cultivated over many years -- as a steady source of business. Sure, there was competition, but big providers could count on considerable loyalty from major customers.

Enter the Internet, with its ability to create portals that allow customers to comparison-shop at a single site, putting notions of staunch loyalty to the test. That model has been taken to the corporate finance field by CFOWeb.com, a venture created by Mountain View, Calif.-based Integral Development Corp. CFOWeb, which went live in late June, allows CFOs and treasurers to shop for multiple products from multiple providers, among them some of the world's largest banks and investment banks. It's highly interactive: If you don't like a quote, you can click on a "chat" button and ask the company if they'll make a better offer.

CFOWeb is in the vanguard of a wave of "commingled sites" or "community portals" that answer corporate executives' prayers for more information and more transaction capability on fewer sites. Using the "reverse auction" technique popularized by priceline.com and travelocity.com, customers can ask suppliers to "bid" on their funding requests -- a swap or a foreign exchange spot forward, for instance. Customers simply enter the parameters -- amount, maturity, etc. -- and check off each of the providers they want a bid from. The site also has customizable features such as news feeds, market research and analysis, including a rendering of the value at risk in the portfolio.

CFOWeb, which claimed more than 4,000 corporate customers by mid-summer, had by early July signed up nine major international financial services firms as providers: ABN Amro, AIG International, BNP Paribas, Bank of America, Standard Chartered Bank, ING Barings, Dresdner Kleinwort Benson, Credit Agricole Indosuez and...