Markit and The Depository Trust & Clearing Corporation (DTCC) have launched MarkitSERV, a new company that will combine the two organisations’ electronic trade confirmation and workflow platforms to provide a single gateway for over-the-counter (OTC) derivative trade processing.
Reportedly, the new entity is expected to combine the DTCC Deriv/SERV and Markit Wire trade confirmation platforms to cover all major asset classes including credit, interest rate, equity and commodity derivatives.
Markit said that MarkitSERV connects multiple market participants and execution venues to downstream processing platforms such as DTCC’s trade information warehouse for credit default swaps (CDS). Additionally, it will also connect to various central counterparty platforms for interest rate swaps and CDS, in collaboration with the DTCC trade information warehouse.
MarkitSERV comprises the Markit and DTCC trade processing services for affirmation, confirmation, novation, allocation and reconciliation. These include Markit Wire, Markit Trade Manager, Markit Tie-Outs and Markit PortRec in addition to the DTCC Deriv/SERV matching and confirmation engine, MCA Xpress and novation consent service.
The new company is expected to rationalise costs by removing the need for users to connect to asset-class specific trade processing systems. Instead, clients will be able to use their existing connectivity to access a variety of combined services. Moreover, MarkitSERV has received regulatory approval from the UK Financial Services Authority and the US Department of Justice. However, the launch is scheduled for September 1, 2009. The new company plans to open offices in London, New York and Tokyo.
Markit’s data and valuation services, and DTCC’s Trade Information Warehouse, life-cycle event processing and centralised settlement and payment netting services will remain part of the respective parent companies.
Michael Bodson, executive managing director of DTCC business management and strategy, and chairman-designate of MarkitSERV, said: “This joint company will now leverage our combined expertise to extend benefits to a wider user base and across a more diverse range of financial instruments.”
Markit is a financial information services company. The Depository Trust & Clearing Corporation (DTCC), through its subsidiaries, provides clearance, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities, money market instruments and over-the-counter derivatives.
