Dealer-backed OTC derivatives trading company SwapsWire is preparing to test its new trading system, developed in association with technology partner Syntegra.
SwapsWire was launched in April 2000 by 23 shareholder banks - collectively responsible for more than 80 per cent of global OTC swaps business.
Since October, the company has been working with Syntegra in specifying and developing the technology components of the project. The system, based on core software supplied by AVT Technologies, will form the backbone for the trading of interest rate swaps and other interest rate derivatives online.
Andrew Brown, SwapsWire CEO, says the proposed solution is designed to bring operational benefits to the derivatives industry. Initially designed for derivatives dealers trading swaps contracts, the system will develop rapidly to include a wide range of OTC derivative instruments, he says.
Users will be able to view prices and details of transactions securely in a standard format and to transfer deal information between counterparties. The company cites three main advantages of the system: improved price distribution and discovery; cost savings made from the reduction of errors in concluding transactions and translating this information into internal systems; automation and streamlining of the confirmation process.
The first phase is due to be tested by founder banks in London starting at the end of March 2001. It is expected other key financial centres will follow soon after.