Press release
Euronext.Liffe buys Cscreen to offer the first straight through processing service for the wholesale equity derivates market
Amsterdam, Brussels, Lisbon, London, Paris – Euronext.liffe, the international derivatives business of Euronext, announced today that it has bought CScreen Ltd., the provider of CScreen, a leading pre-trade price discovery platform for wholesale equity derivatives, from Cinnober Financial Technology AB.
The acquisition of CScreen is the basis of Euronext.liffe’s new wholesale service, which will offer customers for the first time ever straight-through processing (STP), from pre-trade price discovery to post-trade booking and administration. This unique service will automate existing manual processes inherent in OTC transactions, giving customers a flexible, secure, simple and significantly cheaper way of conducting their wholesale equity derivatives business.
Hugh Freedberg, Chief Executive of Euronext.liffe said: “This service will offer customers a comprehensive means of carrying out their wholesale business – something which has never been available in either the OTC or listed markets before. By offering straight-through processing and a competitive fee structure the service will make trading easier and help reduce costs and operational risk.”
Cinnober will deliver all the components for the new service as well as continue to provide technical development for CScreen. Nils-Robert Persson, Chairman of Cinnober, said, “CScreen has developed a strong community of users since it was launched and is gaining an increasing foothold in the marketplace. When CScreen is linked to automated post-trade matching, administration and clearing services the whole offer is both innovative and extremely compelling. We are excited about working with Euronext.liffe to deliver this new service.”
The service will cover a broad range of European blue-chip stocks and indices, including Belgian, Dutch, Finnish, French, German, Italian, Portuguese, Spanish, Swedish, Swiss and UK products.
The OTC market is several times the size of the exchange-traded market and is growing strongly. The new service is designed to capture an increasing amount of this off-exchange business.
Euronext.liffe’s provision of the service is subject to final FSA regulatory approval.
For more information, please contact:
Amsterdam: +31 20 550 4488
Brussels: +32 2 509 1392
Lisbon: +351 217 900 000
London: +44 20 7379 2315
Paris: +33 1 49 27 11 33
Notes to Editors:
1. Euronext.liffe’s new wholesale service will comprise three integrated components, the first of which is CScreen, the pre-trade price discovery platform developed by Cinnober. This allows inter-dealer brokers to post and respond to “indications of interest” in wholesale equity derivatives on behalf of their clients.
From this pre-trade price discovery platform Euronext.liffe will build secure straight-through processing links enabling users to book their transactions via either an “on-exchange” administration and clearing service or an “off-exchange” post trade matching service. The systems enabling these services will also be provided by Cinnober who specialise in developing and delivering exchange trading technology.
Pre-Trade Post-Trade
CScreen – A pre-trade, price discovery platform, enabling banks and brokers to post and respond to ‘Indications of Interest’ (IOI) in respect of wholesale equity derivatives. Direct link to either Cleared Service – An “on-exchange” administration and clearing service for wholesale transactions. The Cleared Service will cover a broad range of European stocks and indices and is available on vanilla products (standard exchange look alikes with additional flexibility).
OTC Post-Trade Matching Service – An “off-exchange” post-trade matching service offering both affirmation and confirmation for OTC transactions.
2. Size of OTC Market
Amount of notional value outstanding in OTC equity-linked derivatives (US$ billions)
December 2003 June 2004
Global (includes Europe) 3,787 4,521
Europe 2,382 2,768
Source: BIS Quarterly Review, March 2005
3. Cinnober Financial Technology
Cinnober Financial Technology AB develops exchange and marketplace systems. Cinnober’s products are all based on the in-house developed platform TRADExpress, and are used by some of the largest marketplaces in the world. The development is performed in 100% Java, which enables flexible, fast and platform independent solutions built for high capacity.
Cinnober was founded in 1998 and has since then grown to employ over 80 people. The company has been profitable from day one and therefore has a strong capital base and is well prepared for future development.