Bank-owned electronic dealing platform BrokerTec Global is celebrating its second anniversary after recording a net profit for the fourth quarter 2001 and Q1 2002.
BrokerTec, which offers trading in multiple products, has over 70 of the world's leading fixed income participants and allows trading access from nine countries via a single platform. The company, which is owned by 14 Wall Street banks, is currently rumoured to be a possible acquisition target for inter-dealer broker Icap.
Since it began operations in June 2000, BrokerTec claims to have transacted $35 trillion (single count) in fixed income securities. Counting one side of each trade, fourth quarter 2001 volume broke the $6 trillion mark, and first quarter 2002 transaction volume was $8.015 trillion. Currently, BrokerTec's daily average transaction volume is $135 billion, and its average transaction size is $28 million, putting it second only to eSpeed for all-electronic broking.
Hal Hinkle, CEO and president of BrokerTec Global and BrokerTec USA, comments: "Our state-of-the-art technology platform and our fully electronic business model enable BrokerTec to provide high-quality, anonymous execution at what we believe are the lowest costs in the industry."
Based on its second quarter 2002 performance thus far, Hinkle expects BrokerTec to surpass its first quarter 2002 total transaction volume.
BrokerTec USA's key OTC products include US treasury, US agency, strips, repo and mortgage TBA. The company has also moved into the futures markets with the establishment of BrokerTec Futures Exchange and BrokerTec Clearing Company.
In Europe, the platform is now live in 11 of the 14 European repo markets with daily volumes in excess of EUR60bn, including: Germany, France, UK, Italy, Spain, Austria, Belgium, Holland, Finland, Greece and Ireland. The firm says Portugal will be added shortly with Denmark and Sweden coming online later this year.
BrokerTec Europe is also looking to cash in on growing demand for basis trading. The company says it is to begin trading in swaps futures against cash securities on Monday through an alliance with derivatives exchange Euronext Liffe. Entry into the UK cash Gilt market is also anticipated, pending approval of application to become an 'official' Gilt IDB.