FTF News also reports upon FinTech developments from FlexTrade, Allen & Overy, IHS Markit, SmartDX and QuantHouse.
Northern Trust to Take Part in Expanded CDCC Program
Northern Trust Canada officials have announced that they launched a direct clearing of cash and repurchase agreement (repo) trades for fixed income securities through an expansion of the clearing model of the Canadian Derivatives Clearing Corp. (CDCC), officials say.
In addition, Northern Trust reports that it is the first global custodian to use the CDCC services, clearing trades for the Healthcare of Ontario Pension Plan (HOOPP), officials say.
“HOOPP and three other large buy-side organizations were invited to apply to become Limited Clearing Members (LCMs) by the Bank of Canada in order to participate in an expansion of direct clearing announced in 2017 by the CDCC, Canada’s national central clearing counterparty (CCP) for exchange-traded derivative products, certain over-the-counter products and repos,” officials say.
“The expansion of CDCC’s direct-clearing model to include LCMs extends the range of benefits associated with CCP clearing, including capital, margin and collateral efficiencies,” Northern Trust officials say.
“Partnering with Northern Trust strengthens our investment ability since many of our investment strategies rely on repo financing to make them work,” says HOOPP President and CEO Jim Keohane in a prepared statement. “This new setup will make HOOPP a more attractive counterparty for the banks and should ensure liquidity from this source during severe market downturns, which is good for our members.”
Based in Chicago, Northern Trust Corp. offers custodian services such as wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals, officials say.
FlexTrade Targets Hedge Funds, Mini-Primes via New EMS
FlexTrade reports the official release of FlexNOW, which it describes as an out-of-the-box, broker-neutral execution management system (EMS), to address the needs of hedge funds and mini-primes who require a multi-asset trading system.
FlexNOW is MiFID II compliant; provides connectivity to leading market data providers; integrates with any order management system (OMS) via the FIX electronic trading protocol and API; and comes with its own built-in transaction cost analysis (TCA) functionality, the vendor says.
The system is currently available in Europe, the Middle East and Africa, and has more than 200 live users, per FlexTrade.
Allen & Overy, IHS Markit & SmartDX Launch Margin Xchange
Allen & Overy, IHS Markit and SmartDX report jointly that they have launched Margin Xchange, a new product for the derivatives market.
The three companies call Margin Xchange an online platform that “covers all stages of the mass repapering of derivatives contracts required to comply with Initial Margin (IM) regulations. It provides information reconciliation, document generation, negotiation and execution, case management and a full data export.”
Margin Xchange “achieves the long-held goal of treating derivative documents as data, by using a document format that is human and machine readable,” according to the vendors’ statement, which points out that IM regulations are already affecting around 40 bank groups globally, but “that number will explode in 2019 and 2020 as hundreds of new counterparties are brought in scope.”
Margin Xchange “puts the entire (IM) process on to a single online platform,” the companies say, and “enables counterparties to bulk import and reconcile counterparty data; mass upload and agree their term sheets; generate and customize all IM documents; run all negotiations and drafting; execute by electronic signatures and capture the full audit trail of every negotiation point, internal escalation and sign-off.”
Margin Xchange users will be able to “record every variable as a data point, rather than text, enabling them to maintain a clear view of progress at every stage during the repapering task, provide higher quality progress reports to regulators and represent the documents as data that can be stored and interrogated in the future with ease,” the companies point out.
QuantHouse Rolls Out Trade and Book Synchronization Feature
QuantHouse, a provider of end-to-end systematic trading solutions, including market data services, an algorithmic trading platform and infrastructure solutions, reports the launch of its trade and book updates synchronization feature.
The new feature is a response to client requirements, the vendor says in a statement.
The new synchronization feature is focused primarily on feeds from derivatives exchanges and is currently live for Eurex, CME and ICE feeds, QuantHouse specifies, adding that it “allows clients to reconcile trades and book updates when consuming data in real-time, or when working with historical data.”
The new feature is available on the firm’s QuantFEED and ConsolidatedFEED.