Coredeal offers great white hope
The launch of Coredeal MTS may be seen by its founders and the banks that part-own it as the great white hope of liquidity and transparency in the European corporate bond market, but at the moment, its function is very limited.
The platform says it will offer two-way pricing on each of the corporates listed from at least five market-makers on tickets of e10 million. But at the moment, only euro-denominated transactions over e3 billion in size with two years remaining to maturity qualify for the platform, which means there are fewer than 10 companies listed on it (see chart) and GMAC and Ford are the only non-telco credits involved. The argument goes that smaller deals would not offer enough liquidity for market-makers to be able to make a commitment. But this means that to begin with at least, the platform can only aim to enhance liquidity in the telecoms sector, which is the largest and most liquid already.