Cognotec has entered a joint venture with Softbank Finance Corporation and systems integrator Posdata to develop, market and deploy Internet-based foreign exchange dealing solutions to Korean financial institutions.
At the same time, Softbank has made an additional $10 million investment in Cognotec raising its total stake in the Dublin based company to 31 per cent. It follows a similar $10 million stake in December, and brings Softbank's total investment in Cognotec to $60 million.
The additional Softbank funding has contributed to a $100 million investment programme designed to re-orient Cognotec's business model from supplying one-off FX trading packages to large-scale banks to delivering an Internet-based transactional hosting service for mid-market institutions.
Brian Maccaba, Cognotec chairman says: "We are now working with some 90 financial institutions in over 23 countries. Collectively our clients are increasing the amount of foreign exchange business executed across the Internet with their monthly compound growth in transactions approaching 30 per cent."
Softbank is already a partner in Cognotec Japan KK which provides e-commerce dealing solutions to the Japanese marketplace with customers including Bank of Tokyo Mitsubishi, banks within the Mizuho group as well as a number of foreign banks active in the Japanese foreign exchange markets.
The new venture, Cognotec Korea, aims to make a similar splash in a country which is experiencing rapid growth in e-commerce. According to the Korean government nearly 20 million South Korean - roughly 45% of the population use the Internet regularly. In 2000, the nation's five leading brokerage firms reported combined online trading values of approximately WON100 trillion - a 24 fold increase from the previous year.