NEW YORK — Investors in the U.S. tri-party securities
repurchase (repo) market can now use Bloomberg technology to
match and confirm repo trades with both clearing banks, Bank of
New York Mellon (BNY) and JP Morgan. Bloomberg’s fixed income
group announces the first agency-neutral platform that allows
investors to process and confirm repo trades with either
clearing bank as mandated by the Federal Reserve Bank of New
York (The Fed).
The Fed, following the financial crisis, asked for improvements
to the settlement structure of tri-party repos, which represent
an estimated $1.8 trillion a day in deal turn over. Bloomberg’s
Fixed Income Trading platform tracks and matches repo trades
using a voice confirmation system (VCON) and automatically
informs BNY Mellon and JP Morgan that a trade has occurred. The
FIT platform and process meets the guidelines issued by the Tri-
Party Repo Infrastructure Reform Task Force (the “Task Force”).
“The enhancements to our tri-party repo platform bring greater
transparency to the market,” said Ben Macdonald, Global Head of
Fixed Income Trading at Bloomberg LP. “More than 500 trading
firms are affected by the guidelines and can now replace ad-hoc
methods of matching trades with an automated system that takes
the guess work out of meeting the compliance guidelines.”
“Market participants using Bloomberg’s system will benefit from
the automation of key aspects of the trading process for tri-
party repos,” said John Vinci, managing director of BNY Mellon
Broker Dealer Services. “We are fully supportive of the changes
recommended by the Task Force, which will lead to greater
confidence and transparency in the tri-party marketplace.”
Bloomberg executes more than 85,000 block repo agreements per
month across specials repo, general collateral (GC) delivery vs.
payment (DVP) and tri-party classifications. There are already
27 dealers exchanging tri-party trade confirmations over
Bloomberg’s FIT platform.
“Partnering with Bloomberg for tri-party repo matching has
allowed Federated to seamlessly match deals against our dealer
community, and it has provided flexibility and integration with
the clearing banks while meeting regulatory timelines,” said
Albert Morabito, Director of Global Trading Operations at
Bloomberg LP is the world’s most trusted source of data, news
and technology for businesses and financial professionals.
Headquartered in New York, the company employs more than 13,000
people in 185 locations around the world. Bloomberg Fixed
Income Trading (FIT) is the world’s largest and most widely used
fixed income trading platform. FIT provides liquidity, trading
functionality, and straight-through-processing across all fixed
income asset classes including cash bonds, repo, money markets,
interest-rate and credit derivatives, mortgages, money markets,
and municipal bonds. FIT is the only fixed income platform which
is fully integrated with the Bloomberg Professional service.