CLSA Asia-Pacific Markets, a Hong Kong-based subsidiary of Credit Agricole, is preparing to launch a dark pool exclusively for block trading in Asia.
Due to be launched next month, CLSA says the new BlocSec service will be the "first Asian dark pool" and will offer buy and sell side participants an anonymous crossing network and provide an efficient venue for clients to arbitrage information leakage and liquidity discovery on a block scale
The service will launch on 15 May with initial support for the Japan and Singapore markets. Hong Kong will follow on 22 May, while Korea and Australia are scheduled to be added to the service later in 2008.
The minimum trade will be USD$1 million on a firm order basis only. A choice of crossing options will be available from the traditional mid-point, passive and aggressive, through session-based and full day VWAP, as well as a last-close option to allow for BlocSec's crossing hours.
CLSA says clients can customise when and how to interact with the system and will be able to connect from their existing OMS using FIX, via the Bloomberg EMS or using the BlocSec web-login.
Although independent of CLSA's trading operations, the bank will provide support for infrastructure, credit risk and clearing and settlement services.
BlocSec CEO Ned Phillips says with the growth of crossing networks around the world, clients have shown an increasing demand to gain the benefits of this execution style in Asia.
"We have worked to develop a simple but effective model where the ability to game has been eradicated. Our clients can be assured of totally anonymity with BlocSec," says Phillips.
Last year CLSA Asia-Pacific Markets implemented Tibco's Enterprise Message Service to streamline back office operations and re-vamp its dealing platform in order to support increasing use of algorithmic trading methods.
The bank said overhaul was required after it recorded a 30-40% increase in global trading volumes in recent years, resulting in a five-fold increase in the amount of messages handled, driven primarily by the proliferation of algorithmic and black box trading.