Barclays Capital was the first bank to build a trading system, which it has rolled out via Bloomberg, and which caters for both the bank and the customer market. The bank has found an ingenious way to get around the principal obstruction to launching online swaps trading, which is how to check your credit line with a counterparty. It integrates the system with clients’ back offices, so that it knows automatically what their credit limit is to a particular client, and if the client is about to breach it.
The system, uniquely in the swaps market, is established and has been doing good volumes. The fact that it is rolled out on Bloomberg gives a large market access to transparent swaps prices for the first time, and it also integrates Bloomberg’s swaps analytics onto the Barclay Capital system. Several other banks are lining up to build similar systems on the Bloomberg network.
JE