Bloomberg
Fixed Income
Issuance and Trading
BALKAN REGION
Robert Cutler
Debt Market Trading Products
r.cutler@bloomberg.net
Dubrovnik, Croatia
12 May 2007
Multi-Dealer RFQ
Fi r m An o n y m o u s O r d er s
Voice Trade Reporting
M ar k e t Ac t i vi t y D i s pl a ys
STP Features
Counterparty Credit Logic
No Transaction Fees
Market Oversight Tools
Bloomberg
Bloomberg Overview
Primary Markets
Bloomberg Fixed Income
Trading Platform
Analytics
Secondary Markets
Bloomberg Overview
Subscription base
Growth in Local Markets, 2006
245 000
35%
46% subscription base INCREASE in Croatia,
for 2006
Fixed Income Volumes, 2006 – EMEA
Volume
Market Share
Euro Govies
1225 bn
37%
Credits
348 bn
81%
IRS
1336 bn
79%
Primary Markets
Bloomberg Bond Auction System
20 State Ministries/Treasuries use the
Bond Auction System to
Auction their Government Bills or Bonds
Australia
Netherlands
Ireland
Portugal
Belgium
Finland
Israel
Czechoslovakia
Iceland
Croatia
South Africa
Slovenia
United Kingdom
Primary Markets
Key Benefits
Efficiency
Time to release results to market dramatically
reduced
Transparency
Robust Technology
Plug & Play, Easy Deployment
Free
Primary Markets
Bloomberg’s Primary market Auction System automates all elements of the auction process.
The system gathers and manages primary dealer bids and automated, instantanous
allocation via the BLOOMBERG PROFESSIONAL service
Auction result are
transmitted to dealers and
secondary markets
worldwide via the
Bloomberg’s secure private
network.
The Bloomberg Auction
System is used by central
banks, Ministries of Finance
and Corporate issuers
globally.
Users have complete
control over access and
allocation
Primary Markets
The Primary Dealer bids for
a new bond by simply
choosing the auction, then
entering on the bid entry
page.
The auctions are run in
Thousands (M),
millions (MM), and
Billions (B)
Primary Markets
Once the bid entry ticket
has been filled by the
Primary Dealer and the
auction has been closed,
the Ministry of Finance
will run their Algorithm
and the auction results
will be issues
Bid submission on behalf of
participants
•
Issuers can enter bids on behalf of participants should a
participant have a technical problem. (optional)
– The bid appears in the participants BLOT. The trade detail shows
how enter the bid for the participant.
New Bid Ticket
New Bid Ticket
•
•
•
•
•
•
•
•
Clearer layout – easier to use
Submit firm’s current position in security
Update all prices at in one go with a price change function
Display which clients participants are bidding on behalf of
Submit button to simplify the bid submission
Scroll bar if there are more bids than can be displayed on one page.
Per User Ticket – only displays bids the user has entered
Ticket entry error messages appear in pop-ups making their display
much clearer.
Bid parameters
•
•
Per user limits
User can setup up limits for
– Size
– Price
That get applied in the bid ticket. This gives the primary dealer a safety net when
using an electronic system.
Separate client lists
•
Issuers can now setup separate participant lists for individual tenders
– Participants will only have access to bidding, be notified and receive banners for
auctions that are run in sectors they are enabled for.
Tender results summary
Fixed Income Electronic
Trading Platform
Key Asset Classes
Governments, Credit, Convertibles, Swaps,
Credit Default Swaps, ECP, Repos,
Structured Products
Dealing Methods
Click & Deal
Request for Quote
Government Bonds
Ability to view
curve, see
depth of
market and
click and deal
Government & Credit Bonds
Click & Deal
Government & Credit Bonds
Request for Quote
TRADE GOVT SWITCHES MRFQ UPTO 5
DEALERS IN COMPETITION FROM BBT<GO>
OR SST<GO>
BRANDING + PRICING
Analytics
Runs Manager
Axes
Message Mining
Analytics
Ability to see the
depth of market
in a bond
Click & Deal
RFQ
Analytics
Axes
Runs
Message Mining
BQ <GO>
EBND <GO>
• Key Benefits
1) UNIFICATION OF VARIOUS SOURCES
OF LIQUIDITY
2) IMPROVED PRICE DISCOVERY
3) EASIER AND MORE EFFICIENT
TRADE EXECUTION
5) STP PROCESSING TO SETTLEMENT
AND CLEARING
6) LOW OVERALL COST AND NO FEES
7) MORE EFFICIENT MARKET OVERSIGHT
CAPACITY
Key Features
• All you need is your Bloomberg (no additional hardware or software
required)
•No additional charges/costs
• Integration/connectivity available to other systems –
‘straight-through-processing’ of trades
• Market information reporting available – e.g. SGSM<GO>
• Ability to submit 2-way request-for-quote to dealers
• Dealers have access/enablement controls for counterparties
• Ability for aggressor to trade on all prices received back in any inquiry
• Ability to enter firm, anonymous orders (where enabled) as well as
counterparty credit limits
• Ability to handle more complex order types such as ‘iceberg’, ‘all-ornothing’ etc
• Ability to receive requests-for-quote when not quoting on a bond
EBND<GO>
EBND<GO>
• Benchmark bonds all listed
down centre of screen
• Dealers can control who
sees/can trade on their prices
• Depth of market from every
available dealer available for
each traded bond
• Simple controls – ‘point-andclick’, and red mouse buttons
at top of screen for other
options
• Note red ‘SUSPEND
QUOTES’ button at the top of
the screen – ‘Panic Button’ for
dealers
EBND<GO>
• Click on a bid or offer
price to launch a trade
ticket
• 2 modes: ‘Order’, ‘Inquiry’
• Inquiry: Select up to 5
dealers from list, send
‘RFQ’ – receive up to 5
prices back – trade
• Order: Anonymous or
‘name-giveup’ – click and
trade on price. Live credit
checking feature for
counterparties trading
anonymous orders
EBND<GO>
• Dealer responds to inquiry
within same screen – Note
new inquiry message in pink at
bottom of screen
• Dealer can set alerts for
bid/offer spread tolerance to
warn of incorrect pricing – Note
alert in red ‘spread tolerance
exceeded’
• Dealer can see how many
other dealers involved in
competition for the request-forquote – Note (2) in light blue
strip at the top of inquiry
response popup: this indicates
2 other dealers in competition
EBND<GO>
• Inquiry: Aggressor
receives responses from
dealers – clicks ‘SELL’,
‘BUY’, or ‘PASS’
• Aggressor may trade on
as many as all 5 prices
received back from
dealers. Trade completed
when all 5 prices either
traded or passed – or
when ‘FINISHED’ button
at top of screen is clicked
EBND<GO>
• Dealer able to requote or suspend
quote given to
aggressor before his
price is accepted –
Note red ‘suspend’
button in dealer
popup
EBND<GO>
• Example of aggressor’s price blotter showing dealer
suspended quote during inquiry
EBND<GO>
• All trade details are
recorded
automatically
• Trade details can be
passed automatically
to other
internal/settlement
systems on
completion of a trade
(‘Straight-throughprocessing’)
EBND<GO>
• Automatic logging of
entire trade
negotiation –
Bloomberg
‘Transaction History’
screen
EBND<GO>
• Counterparty credit
limit management
tools to allow a dealer
to create limits for
anonymous order
trading for each
counterparty
EBND<GO>
• Data from trading on the
EBND platform can be
provided to the market –
Here we see intraday
volumes and trading
statistics for each bond
traded on the Singapore
EBND platform. This aids
market transparency and
development
What is Bloomberg’s Goal?
Central place for all market liquidity
Benchmark system for all market data
in established and local markets
Facilitate efficiency and transparency
in local markets
Make Bloomberg the preferred solution
in Primary & Secondary Bond Markets
Contacts:
• Robert Cutler - +44 20 7330 7494
• Ebru Boysan - +44 20 7330 7691
• Bloomberg Help Desk
• Bloomberg Electronic Trading Team:
+44 20 7330 7476