In other financial technology news, ICE completes its acquisition of Interactive Data and Australia debuts rules for clearing.
EBS Direct to Use FIX 4.4 API
EBS BrokerTec, the electronic foreign exchange (FX) and fixed income business group of interdealer broker ICAP, reports that end-users can connect to its FX platform — EBS Direct via a FIX version 4.4 application programming interface (API).
The Financial Information eXchange (FIX) protocol for electronic trading is overseen by the FIX Trading Community. Historically, FIX has been a standard for front-office trading. However, for several years its backers have been extending the protocol for cost-effective post-trade operations.
EBS Direct will be applying FIX 4.4 to “improve performance with accurate and timely information flows, and the establishment of full quote attribution,” officials say. “The introduction of attribution transforms the insight customers now have when it comes to trading activity over EBS Direct.”
The use of the FIX 4.4 API is “a big milestone for EBS Direct,” says Jeff Ward, global head of EBS Direct in a prepared statement. “It will not only improve the trading experience for existing customers, but it will also open us up to new customers segments as we alleviate some of the work previously required to onboard. This is particularly important as EBS Direct continues to grow in terms of both liquidity providers and consumers on the platform.”
EBS Direct offers trading in 86 currency pairs with 28 liquidity providers and more than 400 liquidity consumers using the service, officials say. Average daily volumes have increased from $5 billion in April 2014 to $18 billion in October 2015.
ICE Finalizes Interactive Data Acquisition
The Intercontinental Exchange (ICE), a network of exchanges and clearinghouses including the New York Stock Exchange, has completed the $5.2 billion acquisition of Interactive Data Corp. (Interactive Data), a provider of market data, analytics and related trading solutions, officials say.
With the acquisition, Interactive Data becomes a wholly owned subsidiary of ICE, having been acquired from Silver Lake and Warburg Pincus for approximately $3.65 billion in cash and approximately 6.47 million shares of ICE common stock, which were valued at $1.55 billion on October 23, 2015, based on the 10-day trailing volume-weighted average price of the ICE common stock as of that date, officials say.
Using the 10-day trailing volume-weighted average as of December 10, 2015, the 6.47 million shares have an approximate value of $1.67 billion. ICE officials add that the company had issued $2.5 billion in senior notes for the cash portion of the transaction.
The Interactive Data purchase will be “a cornerstone in our strategy to provide more data and valuation services to our customers around the world,” said Jeffrey C. Sprecher, ICE chairman and CEO, said in a statement.
Australian Securities and Investment Commission Reveals Rules for Clearing
The Australian Securities and Investment Commission (ASIC) is releasing rules governing the implementation of Australia’s mandatory central clearing regime for over-the-counter (OTC) derivatives of financial institutions via the ASIC Derivative Transaction Rules, officials say.
The mandatory central clearing regime has been created “to help reduce systemic risk in OTC derivatives markets and applies to transactions in OTC interest rate derivatives denominated in Australian dollars (AUD interest rate derivatives), and in US dollars, euros, British pounds and Japanese yen (G4 interest rate derivatives) between OTC derivatives dealers,” officials say.
The ASIC regime also provides the “basis for substituted compliance or sufficient equivalence determinations by foreign regulators,” officials say. “This will help to achieve substantial cost savings for Australian participants and facilitate access to global markets by Australian participants and infrastructures.”
The regime will help cut systemic risk by requiring “key interest rate derivatives traded between the largest derivatives dealers to be centrally cleared,” says ASIC Commissioner Cathie Armour in a prepared statement. “The rules have been designed taking into account the mandatory clearing requirements in other jurisdictions in which Australian financial institutions operate. We will work with overseas regulators to determine whether or not equivalence or substituted compliance treatment is available as this will assist Australian financial institutions manage implementation of the regime.”
The ASIC clearing rules “set out which entities and derivative contracts are covered by the clearing mandate, the eligible central counterparties that may be used, alternative clearing (allowing entities to comply with certain overseas clearing requirements) and certain exemptions from the clearing mandate,” according to ASIC. The clearing obligations will begin April 2016.
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