TP ICAP beefs up bond digitization with access to Liquidnet’s NIT protocol

abdelaziz Fathi

Electronic trading venue Liquidnet continues to expand beyond its dark pool roots in corporate bond trading to enable dealers to join the buy-side in placing orders and trade directly on its new issue order book.

Its parent, TP ICAP, todays said it has enhanced Liquidnet’s New Issue Trading (NIT) protocol for bonds with additional smart execution tools that direct different order types to the most appropriate execution methods. Liquidnet’s network of asset managers might see big benefits from automating new issue data and workflows from TC Icap’s bank customers.

Liquidnet launched the NIT protocol back in September 2021 as the first electronic solution to trade new issues in Europe. While secondary market bond trading is increasingly electronic, new issues at this time were only just beginning to catch up.

Already available to its peer-to-peer network of institutional asset managers, expanding access to the protocol will now allow more than 100 of TP ICAP’s major dealer clients to also connect. The move enables the buy-side and the sell-side  to trade together for the first time from a TP ICAP screen, combining a workflow tool to automate and streamline new issue announcements and pricing data.

Dealer will be able to access digital tools for debt capital markets, including the new issues, through TP ICAP’s electronic portal Fusion – which also enables users access the group’s aggregated liquidity and post-trade services.

Nicolas Breteau, CEO of TP ICAP, said: “Making it possible for TP ICAP’s dealer clients to connect to the innovative NIT protocol means a deeper liquidity pool and more efficient trading experience for all – buy-side and sell-side.  It’s another compelling example of what the combined strengths of TP ICAP and Liquidnet bring to market, and that we are on track in executing our growth plans.”

Mark Russell, Global Head of Fixed Income for Liquidnet, added: “The electronification of new issue trading is one facet of Liquidnet’s overall Primary Markets initiative.  We were the first to introduce a new issue trading protocol in EMEA, and today’s announcement helps to industrialise that innovation by taking it to a new audience. The outcome is improved liquidity, more efficient new issue trading, while still maintaining anonymity.”

The move is intended to boost Liquidnet’s franchise and offer a range of execution services including client coverage, sales trading and trading. The strategic integration also leverages the existing geographic infrastructure and expertise within the TP ICAP Group.

Participants in Liquidnet’s EM business nearly doubled in less than four years, from 90 asset managers in 2018 to over 500. The company’s coverage also extends to six local debt markets including Mexico, Turkey, South Africa, Czech Republic, Hungary, and Poland.

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