On January 24, six banks announced plans to launch www.BondClick.com, a website set up to enable investors to trade European government bonds online. More than three months later, all is still quiet on the BondClick front.
“The announcement was made earlier than might be normal,” says Saman Majd, global head of OTC derivatives and fixed income at Deutsche Bank. Deutsche initiated the idea and invited other banks to participate. In the end, ABN Amro, BNP Paribas, Caboto, Dresdner Bank, and JP Morgan signed on.
Majd says it was important to make their intentions known to the market so that investors would not be concerned about the lack of such a platform in Europe. A comparable system, Tradeweb, has already established itself in the US and now accounts for a significant portion of US treasuries trades. Is BondClick just making an attempt to claim the European market before Tradeweb can get there?
“BondClick is designed uniquely around the European markets,” says Majd. Yet BondClick will operate on the same concept as Tradeweb, a multiple-dealer system whereby investors can obtain prices from all participating dealers at once. Deutsche Bank and JP Morgan both participate in Tradeweb, but are not founding members.
BondClick’s only clear advantage over Tradeweb is its emphasis on the European market. Majd says that the group of banks is small but has pan-European coverage: “European solutions by European houses.”
Arjen van der Linden, global head of interest-rate trading at ABN Amro, says the group understands the urgency to have BondClick operating in the marketplace.
Now, members of the joint venture concede, all that remains is setting up the company. That process includes appointing a CEO, hiring staff, designing the architecture of the system, marketing the company and, of course, choosing a technical provider. Estimates from the group are that the platform will be up and running in the second half of the year.
| Plenty of hype but, it seems, there’s still everything to play for | ||||||
