T-Zero today announced a strategic partnership with Calypso Technology, Inc., the leading provider of capital markets trading software solutions for global financial institutions, which will support the development of an interface between Calypso and T-Zero. This partnership further assists Calypso's clients in improving straight through processing (STP) of credit derivatives trades through T-Zero's services.
Under the new partnership, Calypso's front-office trade capture system provides seamless access to T-Zero's Affirmation Service. T-Zero's workflow and real-time messaging ensures that Calypso clients capture their credit derivative transactions with 100% accuracy. In addition, T-Zero's "Agnostic Connectivity" allows Calypso clients to electronically connect to DTCC, GlobeOp and the T-Zero user base, which is growing daily.
Mark Beeston, president of T-Zero, indicated that all Calypso credit derivatives clients, which include both buy-side and sell-side organisations, can benefit from reductions in operational risk, human errors and operations costs through T-Zero.
Beeston pointed to statements made last week by former U.S. Federal Reserve Board Chairman, Alan Greenspan, indicating concerns that credit default swap transactions were still being captured on paper. According to reports, Greenspan called the backlog of unconfirmed trades "unconscionable" while also commenting that many trades "could be confirmed instantaneously" using available technology.
"Cairn welcomes the partnership between T-Zero and Calypso," said Chris Bentley, infrastructure guru and Head of Operations at Cairn Capital, "We have worked closely with both parties to define a seamless, integrated trade capture and risk management infrastructure, moving towards timely trade data capture and matching. Innovations like this are vital steps in removing the current constraints on the CDS market and creating a volume insensitive environment - promoting growth and stability."
"The credit derivatives market is continuing to develop its own unique infrastructure, of which T-Zero is an instrumental component," said Charles Marston, Chairman and CEO of Calypso Technology, Inc. "At Calypso, we strive to maintain our market-leading position in credit derivatives by working with companies like T-Zero, which we believe brings a valuable proposition to the market. We are delighted to be the first front-to-back solution provider to take this strategic step."
"It is our goal to continue to work toward resolving the multiple operational issues affecting the markets to help ensure future growth in the industry," said Beeston. "We are delighted to be partnering with Calypso in working towards this goal. Calypso software is used by numerous dealers, hedge funds and asset managers and this partnership significantly facilitates the adoption of T-Zero by those institutions."
T-Zero's approach to electronic connectivity and messaging directly addresses the major inefficiencies in post-trade derivative processing highlighted by the New York Federal Reserve and the FSA. T-Zero's post-trade messaging and workflow system has been adopted by numerous dealers and trading platforms.