The International Securities Market Association's (Isma) latest research into the European repo markets shows that the share of electronic trading increased to 20% of the total value of outstanding contracts for the six months ending December 2003.
The majority of the financial institution participants of Isma's semi-annual survey are now using electronic systems for some part of their repo business.
The survey also shows an increase in the amount of business settled through tri-party repo arrangements - where a third-party custodian manages cash and collateral accounts for counterparties - which rose from 6.2% to 11% in the six month period.
Analysis of the underlying data from the banks that took part in the research indicates that the European repo market as a whole grew by over 22% in 2003, with most of the growth occurring in the first half of the year. Isma says the slowdown in the second half reflected difficult trading conditions in the bond markets generally.