Market operator Tradeweb, international central securities depositary Euroclear and data provider Informa Global Markets (IGM) are collaborating to automate the security identification and setup process for soon-to-be issued syndicated Eurobonds in the primary market. This solution aims to improve the way investors access and manage critical pre-pricing data for newly-syndicated Eurobonds, facilitating further automation of primary markets and a streamlined transition into secondary trading.
Newly-issued Eurobonds can enter the market without essential information regarding the new bond, including security identifiers and critical deal information. Due to fragmentation in primary markets, timely and accurate reference and real-time deal data can be delayed. This can hinder market participants from satisfying data requirements to book trades in newly-issued securities.
Buy-side investors are often left with the task of finding manual workarounds and face the risk of incorrect orders or allocations, which can soak up time on buy-side trading desks.
Through the Euroclear and IGM data solutions, the information describing the new issue, the security identifiers and the deal data should become available on Tradeweb at a much earlier stage in the trade process and on a real-time basis, as a newly-issued Eurobond is marketed and priced. Through Tradeweb, participants will have the ability to consume the collated data shell directly or via Tradeweb’s existing order management system (OMS) integrations with over 480 OMSs and 2,500 clients. This in turn should allow investors to automatically set up their new issue securities and efficiently manage their order and allocation process.
“Through collaborating with our mutual clients, we identified the need to automate the security setup process in the primary market,” said Enrico Bruni, head of Europe and Asia business, Tradeweb. “We believe this solution will change the way buy-side investors access essential data for new issues. It’s another step toward a more automated primary market and building greater and faster connectivity with the secondary market.”
“Through this solution, we will address a critical issue for primary market investors around the need for quicker access to reliable new issue deal information for Eurobonds,” said Philippe Laurensy, group head of strategy, Product and Innovation at Euroclear. “We are extremely pleased to be working with Tradeweb and Informa Global Markets on this initiative, which we expect will significantly reduce cost and risk on the buy-side community. As a financial market infrastructure, our role is to bring efficiencies, connectivity and safety to the market value chain from issuers to investors through innovative and sustainable solutions.”
“The previous downstream new issue data setup and reconciliation process was entirely manual and generated significant execution risk,” said Terry Wilby, managing director at IGM. “With this new tri-party solution, buy-side clients will have access to trusted, reliable, accurate and timely information on new bonds readily integrated into their OMS, Execution Management Systems (EMS) and internal systems.”
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