Algomi powers SIX Bond trading initiative

19 January 2015 in COMPANY NEWS by Tim Binnington

from Financial News byTim Cave and Anna Irrera

Switzerland's national stock exchange has unveiled further details about the bond trading platform it plans to launch in the first half of year, one of several new initiatives to help restore liquidity in the fixed income markets.

Financial News reported on the Six Swiss Exchange initiative last month. The Zurich-based exchange said in a statement today that the platform will trade corporate bonds and will target illiquid issues of at least €2 million in size.

Algomi, a company launched by three former UBS executives in 2012 which helps provide information on dealer's bond inventories, is technology provider for the initiative.

“The aim is to make sure that a less liquid portion of the very large bond market gets another alternative to finding liquidity and trading,” Christian Katz, chief executive of the Six Swiss Exchange told Financial News.

The Swiss platform is the latest initiative aimed at boosting liquidity in the fixed income markets. Post-crisis regulations have forced banks to hold more cash against the bonds they have on their balance sheets. While this should make them more stable, it has also led them to significantly reduce their bond holdings, meaning they can no longer act as intermediaries in the fixed income markets.

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