This Week: Broadridge/UBS, Bloomberg, MarketAxess, ICE, and more

UBS deploys Broadridge’s DLT-based repo solution

Broadridge Financial Solutions has announced that UBS went live on Broadridge’s newly launched sponsored repo solution built on the digital-ledger technology (DLT)-enabled Distributed Ledger Repo (DLR) platform, which was launched in June 2021. This sponsored repo solution marks the launch of the next phase in the rollout of Broadridge’s DLR platform, which is part of the trading tech provider’s efforts to modernize the repo market.

“The repo market … hasn’t seen this much activity in decades,” says Horacio Barakat, Broadridge’s head of digital innovation for capital markets and general manager of the DLT repo platform. Barakat tells WatersTechnology this has been driven by technology changes in market infrastructure that have increased efficiency, a different rate environment compared to prior years, and potential regulatory changes concerning central clearing.

For Broadridge, changes to technology and the rate environment have complemented one another. “In a higher rate environment, you need to become much more efficient on both sides—on the borrowing and on the lending side,” Barakat says. For the cash lender, the technology allows them to redeploy cash more effectively. For institutions looking to fund themselves through the repo market, this has meant they are able to do so intraday.

Sponsor repos tend to bring more users into central clearing. UBS had been using the base platform for more than a year but recently looked to adopt its sponsor repo offering.

Barakat is aware that distributed ledger technology has its skeptics but said that DLT is particularly well positioned for repo, a use case Broadridge begun developing for DLT in 2019. “In this case of distributed ledger technology, if you think about the combination of smart contracts and digital representation of collateral, it fits very, very well,” Barakat says.

However, a study published by Euroclear, DTCC, and Clearstream in September, found that 74% of DLT projects have fewer than six participants—a fact the study highlighted as a problem.

Broadridge’s DLR platform has seven entities live on the platform, says Barakat. One firm can have multiple entities on the platform for each of its geographical jurisdictions, adding that how you quantify participants depends on what you’re looking at.

“Twenty percent of the repos … that any broker-dealer does, for instance … are internal between institutions that are affiliated,” Barakat says, but participants can start with use cases like intraday repos that require a network to transact with an outside counterparty.

Broadridge has two additional clients that are set to onboard with sponsored repos, says Barakat: one in early November and one likely in the winter.

Bloomberg completes Broadway buy

Bloomberg has completed its acquisition of Broadway Technology, a provider of front-office financial technology solutions. The acquisition combines Bloomberg’s electronic trade order management solutions (ETOMS) with Broadway’s low-latency execution management solution.

The purchase aims to further develop a low-latency order and execution management solution for the credit and rates markets. It is meant to further the development of comprehensive execution management solutions that provide greater asset coverage, connectivity, automation, and integration with pre- and post-trade workflows in response to demand for increasingly electronified and automated solutions.

HKEX launches settlement acceleration platform for Stock Connect

Hong Kong Exchanges and Clearing (HKEX) will launch HKEX Synapse, an integrated settlement acceleration platform, next week. Synapse is the latest update to Stock Connect, a mutual market access program that connects mainland China and Hong Kong markets. 

The service will launch on October 9, and will deploy DAML smart contracts to standardize and streamline post-trade workflows, enhancing operational efficiencies and transparency while reducing settlement risks.

Other recent enhancements to Stock Connect include the addition of up to 10 Stock Connect trading days per year, as well as the inclusion of more than 1,000 additional stocks listed in Mainland China and made accessible to international investors via Northbound Stock Connect.

HKEX Synapse eliminates sequential processes, offering real-time visibility and insights into the settlement process for market participants. Asset managers, brokers, custodians and clearing participants will benefit from real-time data synchronization and improved scalability, helping them to handle the growing volume of trades through Northbound Stock Connect. Average daily turnover of Northbound Stock Connect totaled RMB109.3 billion ($15.2 billion) in the first half of 2023, up 5% from a year earlier, and a 50% increase from 2020 levels.

MarketAxess adds local currency bond functionality to Open Trading

Electronic fixed-income trading platform operator MarketAxess launched Open Trading for local currency bonds, an expansion of its emerging markets (EM) trading product. It currently supports Poland, Czech Republic, Hungary, and South Africa.

Open Trading for EM local currency bonds connects onshore dealers with a network of international buy-side clients, increasing the available liquidity pool. According to a release, EM local currency bonds made up around 40% of the venue’s EM volumes of $360 billion in the first half of 2023.­

FIA Tech extends brokerage settlement platform to buy side

FIA Tech, a futures industry technology provider, has opened its settlement platform, Atlantis, to buy-side participants.

Atlantis processes the calculation, invoicing, and payment of brokerage fees to executing brokers. It processes about 170 million trades per year. Atlantis formerly facilitated brokerage payments from clearing brokers to executing brokers, but has expanded into managing execution brokerage payments directly.

The platform has 45 institutions settling at 34 clearinghouses with all exchange-traded derivative markets enabled for settlement. The company has onboarded a multi-billion-dollar hedge fund as its first buy-side client on the platform.

ICE completes first London cocoa delivery using electronic warehouse warrants

Intercontinental Exchange (ICE) announced the delivery of London cocoa using fully electronic warehouse warrants, the first time paper-based systems used by customers in the delivery process have been replaced electronically.

ICE’s Softs Deliveries Platform (SDP) records commodities stored in warehouses for delivery under ICE’s futures contracts. SDP is electronifying the grading, tender, delivery, and warrant management processes.

TS Imagine partners with Cassini Systems

TS Imagine, a provider of trading, portfolio, and risk management solutions, has partnered with Cassini Systems, a provider of pre- and post-trade margin and collateral analytics for derivatives, to enhance the margin and collateral analytics available in TS Imagine’s product suite.   

Users of TS Imagine’s technology will gain access to Cassini’s intelligent analytics for over-the-counter (OTC) and exchange-traded derivatives (ETD) products.

The partnership, which aims to offer intelligent margin and collateral derivatives analytics, is targeting prime brokers and hedge funds.

S&P Capital IQ Pro makes upgrades

S&P Global Market Intelligence, a provider of information services and solutions, announced updates to its S&P Capital IQ Pro platform, including enriched content accessibility, improved personalization, and an AI-enabled search function.

Over the last two years, the company has introduced new content to Capital IQ Pro, including fixed income, private markets, fundamentals, sustainability and economic data following a merger with IHS Markit.

Baton Systems launches DLT-based automated settlement platform

Post-trade processing platform provider Baton Systems has released Core-Payments, which provides firms with automated and live control of cash settlements. 

Core-Payments uses Baton’s DLT workflows to track and reconcile inbound cash settlements, and to organize the release of outbound cash payments using changeable rules and live data.

Xceptor and Delta Capita partner on system integrator for T+1

Data automation platform vendor Xceptor has partnered with Delta Capita, a provider of managed services, technology solutions, and consulting for the financial industry, to increase post-trade settlement.

The partnership will use Xceptor’s data automation platform to allow financial institutions to capture and validate standard settlement instructions, simplify trade confirmations, and facilitate block allocations.

Medius launches fraud and risk detection tool

Medius, a provider of automation and spend management solutions, released its fraud and risk detection product for financial industry participants. The solution aims to prevent fraud and help firms gain visibility and control in invoice-to-pay processes.

According to a release, a study from Cybersecurity Research found that more than half of organizations have seen fraud attempts increase in the past year.

The tool uses AI and machine learning to monitors for risk events within the invoice-to-pay process. It also includes analytics to help users understand the threats and preempt issues.