The battle for online interest rate swap (IRS) volumes continues to heat up as Thomson TradeWeb announces it is launching a rival to Bloomberg’s TradeBook for bank to client IRS trading. Thomson has teamed up with six major liquidity providers to launch euro IRS trading on what it claims is the first multidealer platform of its kind.
The founding members for the platform are: JP Morgan, Barclays Capital, Morgan Stanley, Dresdner Kleinwort Wasserstein, HSBC and ABN AMRO, and more liquidity providers are set to join the platform in the coming weeks, the company claims. The Swaps platform, as it will be called, will be rolled out initially to a select group of European buy side institutions, followed shortly by TradeWeb’s full buy side customer base and the rest of the institutional market.
Thomson says its technology will enable greater operational efficiency, risk reduction and market transparency for both the buy and sell side communities. By using a ’request for quote’ model, institutional investors can simultaneously request a price from up to three dealers and move from electronic execution to a full ISDA compliant electronic confirmation, enabled by TradeWeb’s straight-through processing network.
“Working closely with the leading swaps liquidity providers and our global client base, TradeWeb’s Swaps platform allows the analysis, execution and ISDA confirmation of Swaps; simply and electronically,” says Lee Olesky, president of Thomson TradeWeb. “This is a natural evolutionary step for us, leveraging our experience from the 10 electronically traded products already on the network. In January alone, we averaged over $135 billion daily volume across the TradeWeb platform in all products.
“We expect to roll out more functionality and other currencies to our interest rate swaps product over the course of the year,” he adds.
Bill Winters, co-CEO of the Investment Bank at JP Morgan, adds, “We are pleased to be providing our clients with the ability to trade interest rate swaps electronically, increasing efficiency and transparency with less operational cost. We have supported TradeWeb since the inception of their platform, consistent with JPMorgan’s commitment to continued innovation in the derivatives market.”
Eric Bommensath, head of fixed income derivatives and government bond trading at Barclays Capital, concludes, “Barclays Capital has seen first-hand the benefits and opportunities that electronic execution can create for the global swap market. We are pleased to offer our clients this additional access to our liquidity.”