Tradeweb Markets will launch a new US system for trading investment-grade corporate bonds in late July – one month later than was originally planned according to reports.
The fixed-income marketplace, which is co-owned by 10 banks and Thomson Reuters, has attempted to launch a US corporate bond platform on three previous occasions, including one cancelled launch in 2004. Tradeweb’s European corporate bond platform has a 6% share of overall trading in the securities, according to consultancy Celent.
The network is seeking to offer investors a way to buy and sell corporate debt at a time when asset managers are struggling to transact in the US$9.8 trillion American market.
Banks, which include Bank of America Merrill Lynch, Citigroup, Goldman Sachs and JP Morgan Chase, have agreed to create the venue, which includes new functions for exchanging large amounts of corporate bonds, when their revenues from trading fixed-income products are declining due to a combination of low volatility, new regulation and competition from non-bank trading platforms such as Bloomberg and MarketAxess.
“We are making a huge push into the US investment grade corporate bond market,” Lee Olesky, chief executive at Tradeweb, told the
. “We have listened to asset managers and have gathered the support of major liquidity providers.”
The impending launch comes as the US Securities and Exchange Commission (SEC) plans a shake-up of the corporate bond market. In a 2012 report, the agency made a series of recommendations about improvements to the market for municipal bonds.
SEC chairman Mary Jo White last week unveiled plans to make prices more readily available in the corporate and municipal debt markets. According to reports, Tradeweb will offer investors transparency through its streaming prices.
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