MTS launches Global Collateral Management segment for D2C Repo trading
- New service streamlines dealer and client trade flows via RFQ trading protocol
- Full client audit trail for proof of best execution
- Integrated with current trading software for STP connectivity
- LCH Ltd signs as first buy-side trading client
MTS, one of Europe’s premier fixed income trading venues, has launched its new dealer-to-client (D2C) Global Collateral Management (GCM) segment for the repo market on MTS BondVision UK, and is pleased to announce the signing of LCH Ltd, a leading global clearing house as its first buy-side client.
MTS has a presence on the dealing desks of over 100 sell-side institutions and at over 400 buy-side institutions. This makes it ideally placed to help buy-side clients seeking access to balance sheet in an environment of reduced collateral availability and increased regulatory burden through MTS BondVision UK. The unique dealer axe pages will help highlight dealer inventory, linking to interdealer quotes to ensure axe integrity.
Having identified a clear demand for a flexible collateral management system, MTS will offer an RFCQ trading mechanism alongside a trade registration facility.
Dealers and clients will benefit from a variety of new features, including:
- RFCQ efficiencies through automation: clients can send single line or “list” RFCQs to their dealers, with an import function to allow easy upload of bond portfolios
- Straight through processing: dealers benefit from existing STP efficiencies, with trades co-mingled in their current blotter, whilst clients benefit from a full audit trail for proof of best execution
- Flexible tri-party baskets: MTS will list participants’ bespoke tri-party baskets, with visibility restricted to approved dealer-client combinations
- Full control of streaming of indicative quotes for dealers: dealers can stream axes, linked to their interdealer market quotes, to their configured clients on a proposal by proposal basis, directing them to relevant pools of liquidity and leading to improved access to funding and pricing
- Highly granular credit line matrix – full control over trading counterparties with credit lines configurable by counterparty and instrument class with max tenor limits for each line and haircut capabilities
Oliver Clark, Head of Product at MTS, comments: “We are pleased to welcome LCH Ltd to our new Global Collateral Management system. LCH executes significant repo volume as part of its treasury function, and its decision to start to move this business onto our platform is a major vote of confidence in our technology and network. Its involvement, along with MTS's track record as a leading electronic venue for repo markets, will help to establish GCM as the premier platform for clients seeking the efficiency and security of electronic trading for their repo and collateral management needs.”
Bruce Kellaway, Global Head of Repoclear, EquityClear and Collateral at LCH Group: “MTS’s new Global Collateral Management system will allow us to deliver greater efficiencies in our treasury and collateral operations at LCH. Alongside our members, we are active users of the repo market and the increased flexibility offered through the new segment will deliver additional opportunities for execution for our investment activity. LCH continues to work on the development of a new model to allow high quality buy-side firms to use RepoClear, subject to regulatory approval, which will also improve liquidity for market participants and offer them greater access to risk management tools. The new dealer to client functionality offered by this GCM tool will be of value in this regard.”
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Notes to editors:
MTS Group facilitates a number of regulated electronic fixed income markets across Europe and the US that are managed centrally to ensure optimum levels of global harmonisation and consistency. Over 500 unique counterparties trade an average volume of €100 billion each day on these platforms.
The individual companies within the MTS Group are regulated by financial services regulators in a number of European jurisdictions, including Financial Conduct Authority (FCA), Italian Ministry of Finance, Banca d’Italia and Consob, Autorité des Marchés Financiers (AMF). In the United States MTS Markets International Inc. is a member of FINRA and operates MTS BondsPro which is an ATS registered with the SEC.
MTS Cash is a comprehensive and professional cash securities trading environment for the interdealer marketplace. MTS cash includes several domestic markets regulated in different jurisdictions enabling primary dealers to access unparalleled liquidity, transparency and coverage. MTS Repo provides an order-driven market for the electronic transaction of repo agreements and buy/sellbacks in Italy.
MTS BondVision is a trusted and efficient multi-dealer-to-client electronic bond trading platform, delivering exceptional access for institutional investors direct to market makers. MTS BondVision is accessible in Europe from the Italian and the UK legal entities and in the US through the US legal entity of MTS Group (MTS Markets International Inc.). On the BondVision platform, MTS Group provides institutional investors with real-time pricing and the ability to trade with the major dealers.
MTS Credit provides a variety of electronic execution methods for a wide range of multi-currency non-government bonds, including covered, SSA, corporate and financial bonds. MTS Credit is composed of financial instruments available to trade on both BondVision and MTS Prime.
MTS Swaps leverages existing MTS Group distribution technology to deliver immediate access to a diverse range of liquidity providers through your chosen prime banks.
MTS Data is sourced directly and exclusively from the MTS interdealer market and includes benchmark real-time data, reference data, reference prices and historical data, providing the benchmark data source on the fixed income market.
FTSE MTS Indices are operated by FTSE TMX Global Debt Capital Markets, in which MTS has a minority stake. They provide independent, transparent, real-time and tradable Eurozone fixed income indices, based on tradable prices from MTS. FTSE MTS indices are tracked by (and can be traded via) around 40 ETFs in addition to numerous structured products.
For more information, visit www.mtsmarkets.com.
About London Stock Exchange Group:
London Stock Exchange Group (LSE.L) is a diversified international exchange Group that sits at the heart of the world's financial community. The Group can trace its history back to 1801.
The Group operates a broad range of international equity, bond and derivatives markets, including London Stock Exchange; Borsa Italiana; MTS, Europe's leading fixed income market; and the pan-European equities platform, Turquoise. Through its markets, the Group offers international business, and investors, unrivalled access to Europe's capital markets.
Post trade and risk management services are a significant and growing part of the Group’s business operations. LSEG operates CC&G, the Rome headquartered CCP and Monte Titoli, the significant European settlement business, selected as a first wave T2S participant. The Group is also a majority owner of leading multi-asset global CCP, LCH.Clearnet.
The Group offers its customers an extensive range of real-time and reference data products, including Sedol, UnaVista, Proquote and RNS. FTSE calculates thousands of unique indices that measure and benchmark markets and asset classes in more than 80 countries around the world.
London Stock Exchange Group is also a leading developer of high performance trading platforms and capital markets software. In addition to the Group’s own markets, over 40 other organisations and exchanges around the world use the Group’s MillenniumIT trading, surveillance and post trade technology.
Headquartered in London, United Kingdom with significant operations in Italy, France, North America and Sri Lanka, the Group employs approximately 2,800 people.
Further information on London Stock Exchange Group can be found at www.lseg.com.