In other FinTech news, Temenos Partners with UMB, Tradeweb reaches out to the options industry, and AIM Software collaborates with West Highland.
Pilot Involves Canadian Dollar Fixed Income Issuance Transaction
BMO Capital Markets has successfully launched a pilot project for a fixed income issuance transaction that is “mirrored on a blockchain platform alongside leading pension fund investor Ontario Teachers’ Pension Plan (Ontario Teachers),” officials say in a prepared statement.
“The transaction included Bank of Montreal as the issuer and Ontario Teachers’ as the buyer of a [Canadian] $250MM 1-year floating rate Deposit Note, making it the first Canadian dollar fixed income issuance demonstrating the viability of blockchain platforms,” according to BMO.
The pilot transaction, booked as a traditional Canadian Depository for Securities (CDS) issuance, had its parallel via the blockchain “to demonstrate how smart contracts and blockchain could be used for fixed income markets,” officials say.
“BMO Capital Markets designed and built a blockchain issuance system using open source blockchain infrastructure with the goal of testing a next generation settlement system,” officials say. “The prototype allows the security issuer and buyer to view the transaction on the blockchain and verify the accuracy of the term sheet information and payment amounts until maturity of the fixed income security. The technology is intended to enable cost reduction in several areas including compliance, financial reporting, security clearing and settlement of cash transactions.”
The pilot project served as the first step toward “a fully functional blockchain capability that we think will eventually allow primary and secondary trading of securities,” says Kelsey Gunderson, head of global trading at BMO Capital Markets.
The firm hopes to build upon the launch of the prototype, and “will look to continue to partner with clients and other institutions in the evolution of blockchain as an open settlement system.”
BMO Capital Markets is the investment banking subsidiary of the Canadian Bank of Montreal. The Ontario Teachers’ Pension Plan reported $189.5 billion in net assets as of Dec. 31, 2017.
Temenos Partners with UMB Fund Services for ETF growth
Temenos, a Geneva, Switzerland-headquartered banking software company, reports that Milwaukee, Wisconsin-based UMB Fund Services has signed an agreement to update its exchange-traded funds administration capabilities using Temenos’ Multifonds platform.
Under the terms of the just-announced agreement, Temenos will provide UMB with the technology necessary for the ETF servicing platform.
“As the ETF market continues to grow, this partnership will keep UMB at the forefront of ETF fund servicing to support current opportunities and meet market requirements for future growth in this segment,” Maureen Quill, president of UMB Fund Services, says in a statement.
Tradeweb Brings RFQ Trading to the Options Industry
Tradeweb, a provider of electronic marketplaces for fixed income instruments, derivatives and exchange-traded funds (ETFs), reports that it is bringing its request-for-quote (RFQ) protocol to the options market.
Tradeweb now “allows institutional investors to send simultaneous electronic price requests to multiple liquidity providers, putting them in competition for the trade,” according to the company’s statement. “This creates more aggressive pricing and tighter spreads while eliminating the need to call individual dealers or work across multiple exchanges for pricing and execution for large trades. The new platform offers RFQ trading of multi-leg options strategies on all U.S. listed single stocks, ETFs, and equity indices.”
Currently, nine liquidity providers, both banks and proprietary trading firms, are live on the platform, Tradeweb says.
AIM Software & West Highland Support Services in Strategic Partnership
AIM Software, a provider of enterprise data management (EDM) software to the financial services industry, and West Highland Support Services, a data service-and-solution provider, have entered into a strategic partnership to deliver real-time data management services that meet the evolving needs of the front and middle office, the two vendors say.
This strategic alliance “will result in a hybrid fintech solution that combines AIM Software’s GAIN data management with West Highland’s reference data framework.”
West Highland and AIM Software note that they are “embarking on a joint campaign to help clients solve long-standing data problems in real-time.”
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