Fully electronic trading of special repos was launched last week in Europe and three days ago in the US. On 12 December, BrokerTec says it exceeded $10 billion in special repos traded on the system globally.

BrokerTec - which is backed by 13 top-flight trading houses - currently offers electronic trading in six European government cash markets (Germany, France, Belgium, Spain, Holland and Austria), US treasuries, agencies and strips, basis trading on Eurex and Matif, and the new repo business. BrokerTec believes it will be the first and only electronic trading system capable of providing electronic collateral allocation for repo trading when the complete system is rolled out early next year.

Tom Wipf, managing director, global repo at Morgan Stanley Dean Witter, says: "BrokerTec's straight-through processing feature gives our repo traders confidence that their orders are executed accurately, and we've seen improvements in both the speed and accuracy of trade executions."

Ray Kuramoto, managing director, international repurchase agreements at CSFB Europe comments: "The use of LCH and Clearnet as central counterparties to the BrokerTec system for electronic trading of Repos provides real benefits to traders, who can net positions, reduce credit exposure and manage collateral and capital more efficiently."

Catherine Fitzmaurice, managing director, European repo trading at Schroder Salomon Smith Barney Europe, says initial volume suggests that liquidity on the system will be meaningful and should grow as new markets and the general collateral module come on line in the new year.

BrokerTec also announced continued growth in the number of participants using its system and the volume of government bonds traded. At the time of its launch in late June 2000, the system was being used only by BrokerTec's shareholders. Since then, 16 additional firms have signed up. Global's government bond trading volume reached a total of $233 billion in November, up from the previous months $193 billion.