bloomberg fixed income issuance and trading balkan region robert cutler debt market trading products...
TRANSCRIPT
BloombergFixed Income
Issuance and TradingBALKAN REGION
Robert CutlerDebt Market Trading Products
Dubrovnik, Croatia12 May 2007
Multi-Dealer RFQ Firm Anonymous Orders Voice Trade Reporting No Transaction FeesMarket Activity Displays STP Features Counterparty Credit Logic Market Oversight Tools
BloombergBloombergBloomberg Overview
Primary Markets
Bloomberg Fixed Income
Trading Platform
Analytics
Secondary Markets
Bloomberg OverviewBloomberg Overview
Subscription base 245 000
Growth in Local Markets, 2006 35%
46% subscription base INCREASE in Croatia, for 2006
Fixed Income Volumes, 2006 – EMEA
Volume Market Share
Euro Govies 1225 bn 37%
Credits 348 bn 81%
IRS 1336 bn 79%
Primary MarketsPrimary MarketsBloomberg Bond Auction SystemBloomberg Bond Auction System
20 State Ministries/Treasuries use the Bond Auction System to
Auction their Government Bills or Bonds
Australia Belgium Czechoslovakia
Netherlands Finland Iceland
Ireland Israel CroatiaPortugal South Africa Slovenia
United Kingdom
Primary MarketsPrimary MarketsKey Benefits
EfficiencyTime to release results to market dramatically
reduced
Transparency
Robust Technology
Plug & Play, Easy Deployment
Free
Primary MarketsPrimary Markets
Auction result are
transmitted to dealers and
secondary markets
worldwide via the
Bloomberg’s secure private
network.
The Bloomberg Auction
System is used by central
banks, Ministries of Finance
and Corporate issuers
globally.
Users have complete
control over access and
allocation
Bloomberg’s Primary market Auction System automates all elements of the auction process. The system gathers and manages primary dealer bids and automated, instantanous allocation via the BLOOMBERG PROFESSIONAL service
Primary MarketsPrimary Markets
The Primary Dealer bids for
a new bond by simply
choosing the auction, then
entering on the bid entry
page.
The auctions are run in
Thousands (M),
millions (MM), and
Billions (B)
Primary MarketsPrimary Markets
Once the bid entry ticket
has been filled by the
Primary Dealer and the
auction has been closed,
the Ministry of Finance
will run their Algorithm
and the auction results
will be issues
Bid submission on behalf of participants
• Issuers can enter bids on behalf of participants should a participant have a technical problem. (optional)
– The bid appears in the participants BLOT. The trade detail shows how enter the bid for the participant.
New Bid Ticket
New Bid Ticket• Clearer layout – easier to use• Submit firm’s current position in security• Update all prices at in one go with a price change function• Display which clients participants are bidding on behalf of• Submit button to simplify the bid submission• Scroll bar if there are more bids than can be displayed on one page.• Per User Ticket – only displays bids the user has entered• Ticket entry error messages appear in pop-ups making their display
much clearer.
Bid parameters
• Per user limits
• User can setup up limits for – Size – Price
That get applied in the bid ticket. This gives the primary dealer a safety net when using an electronic system.
Separate client lists
• Issuers can now setup separate participant lists for individual tenders– Participants will only have access to bidding, be notified and receive banners for
auctions that are run in sectors they are enabled for.
Tender results summary
Fixed Income Electronic Fixed Income Electronic Trading PlatformTrading Platform
Key Asset ClassesGovernments, Credit, Convertibles, Swaps,
Credit Default Swaps, ECP, Repos,
Structured Products
Dealing MethodsClick & Deal
Request for Quote
Government BondsGovernment Bonds
Ability to view curve, see depth of market and click and deal
Government & Credit Bonds Government & Credit Bonds Click & DealClick & Deal
Government & Credit BondsGovernment & Credit BondsRequest for QuoteRequest for Quote
TRADE GOVT SWITCHES MRFQ UPTO 5 DEALERS IN COMPETITION FROM BBT<GO>
OR SST<GO>
BRANDING + PRICING
AnalyticsAnalytics
Runs Manager
Axes
Message Mining
AnalyticsAnalytics
Ability to see the depth of market in a bond
Click & Deal
RFQ
Analytics
Axes
Runs
Message Mining
BQ <GO>
EBND <GO>
• Key Benefits
1) UNIFICATION OF VARIOUS SOURCESOF LIQUIDITY
2) IMPROVED PRICE DISCOVERY3) EASIER AND MORE EFFICIENT
TRADE EXECUTION5) STP PROCESSING TO SETTLEMENT
AND CLEARING6) LOW OVERALL COST AND NO FEES
7) MORE EFFICIENT MARKET OVERSIGHT CAPACITY
Key Features
• All you need is your Bloomberg (no additional hardware or software required) •No additional charges/costs • Integration/connectivity available to other systems – ‘straight-through-processing’ of trades• Market information reporting available – e.g. SGSM<GO>• Ability to submit 2-way request-for-quote to dealers• Dealers have access/enablement controls for counterparties• Ability for aggressor to trade on all prices received back in any inquiry
• Ability to enter firm, anonymous orders (where enabled) as well as counterparty credit limits • Ability to handle more complex order types such as ‘iceberg’, ‘all-or-nothing’ etc• Ability to receive requests-for-quote when not quoting on a bond
EBND<GO>
EBND<GO>
• Benchmark bonds all listed down centre of screen
• Dealers can control who sees/can trade on their prices
• Depth of market from every available dealer available for each traded bond
• Simple controls – ‘point-and-click’, and red mouse buttons at top of screen for other options
• Note red ‘SUSPEND QUOTES’ button at the top of the screen – ‘Panic Button’ for dealers
EBND<GO>
• Click on a bid or offer price to launch a trade ticket
• 2 modes: ‘Order’, ‘Inquiry’• Inquiry: Select up to 5
dealers from list, send ‘RFQ’ – receive up to 5 prices back – trade
• Order: Anonymous or ‘name-giveup’ – click and trade on price. Live credit checking feature for counterparties trading anonymous orders
EBND<GO>• Dealer responds to inquiry
within same screen – Note new inquiry message in pink at bottom of screen
• Dealer can set alerts for bid/offer spread tolerance to warn of incorrect pricing – Note alert in red ‘spread tolerance exceeded’
• Dealer can see how many other dealers involved in competition for the request-for-quote – Note (2) in light blue strip at the top of inquiry response popup: this indicates 2 other dealers in competition
EBND<GO>
• Inquiry: Aggressor receives responses from dealers – clicks ‘SELL’, ‘BUY’, or ‘PASS’
• Aggressor may trade on as many as all 5 prices received back from dealers. Trade completed when all 5 prices either traded or passed – or when ‘FINISHED’ button at top of screen is clicked
EBND<GO>
• Dealer able to re-quote or suspend quote given to aggressor before his price is accepted – Note red ‘suspend’ button in dealer popup
EBND<GO>
• Example of aggressor’s price blotter showing dealer suspended quote during inquiry
EBND<GO>
• All trade details are recorded automatically
• Trade details can be passed automatically to other internal/settlement systems on completion of a trade (‘Straight-through- processing’)
EBND<GO>
• Automatic logging of entire trade negotiation – Bloomberg ‘Transaction History’ screen
EBND<GO>
• Counterparty credit limit management tools to allow a dealer to create limits for anonymous order trading for each counterparty
EBND<GO>
• Data from trading on the EBND platform can be provided to the market – Here we see intraday volumes and trading statistics for each bond traded on the Singapore EBND platform. This aids market transparency and development
What is Bloomberg’s Goal?What is Bloomberg’s Goal?
Central place for all market liquidity
Benchmark system for all market data
in established and local markets
Facilitate efficiency and transparency
in local markets
Make Bloomberg the preferred solution
in Primary & Secondary Bond Markets
Contacts:
• Robert Cutler - +44 20 7330 7494
• Ebru Boysan - +44 20 7330 7691
• Bloomberg Help Desk
• Bloomberg Electronic Trading Team:+44 20 7330 7476