Fintech weekly deals and partnerships roundup

CoinDesk: Santander, LSEG testing Nivaura’s blockchain-based floating rate bond

Capital markets startup Nivaura has developed what it’s calling “the first commercially viable floating rate bond using blockchain technology,” and the new instrument is now being tested by banking giant Santander and LeasePlan, the vehicle leasing company. Nivaura said other clients working on its floating rate notes (FRNs) include the London Stock Exchange Group (LSEG) and Premfina, a growth-stage premium financing service provider in the insurance industry.

Nivaura, which recently closed a $20 million seed round led by LSEG, has participated in all five “sandbox” cohorts of the UK Financial Conduct Authority. The regulator’s program explores ways to issue digital assets in a compliant fashion and use public blockchains like bitcoin and ethereum as a settlement layer.

Back in 2016, Nivaura executed a reinsurance instrument which managed a register of noteholders using an on-chain token allocation system (sometime before the popularity of this approach took hold in the ICO explosion), while also creating a “calculation and paying agent” smart contract on ethereum. The firm is now applying the same approach to FRNs, using a money market data feed to trigger a calculation. FRNs are calculated according to current market rates, such as the federal funds rate or the London Inter-bank Offered Rate (LIBOR), plus a quoted spread (a typical coupon would look like “3 months USD LIBOR +0.20%”).

“We are extending the simple tokenized equity and bond models to include more interesting hybrid and structured instruments that would be more useful for our clients and partners,” Sehra said. “A natural extension of this is to ensure that the interest is not just simple fixed-rate coupons, but has the flexibility to be a floating value depending on some external reference rate,” said Avtar Sehra, CEO of Nivaura, to CoinDesk.

Managing and programming all the complex events into a smart contract is not commercially viable at this time and not well understood from a regulatory perspective for tokenized securities, he added. In the case of FRNs, it involves managing the data feeds, making a calculation, generating payment amounts and then executing those payments through a smart contract on a blockchain.

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AllianceBernstein selects OpenFin to accelerate move to web tech

OpenFin, the operating system (OS) of finance, announced that AllianceBernstein, the global asset management firm, has chosen OpenFin to help accelerate their digital transformation strategy. The collaboration will help AllianceBernstein modernize their desktop technology infrastructure, allowing integration and interoperability with legacy and third-party applications without the need to rewrite legacy code.

The asset manager is now actively migrating .NET and legacy applications onto OpenFin OS, accelerating their movement to web technology. As a result, traders can develop more efficient workflows and make better use of their existing trading tools. The ability to interact with both internal and external applications ultimately empowers traders to add even greater value to both the investment and execution process.

The OpenFin OS is now being used to deploy more than 1,000 applications to more than 1,500 major banks and buy-side firms located across 60+ countries. Interoperability comes as standard for all applications built on OpenFin OS, allowing them to share information, intent and context with third party apps in a permissioned manner.

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TradeChannel expands SFTR partnership with REGIS-TR

Sweden-headquartered TradeChannel announced an expansion of its collaboration with REGIS-TR to provide an end-to-end Securities Financing Transactions Regulation (SFTR) reporting solution, which is ready for early testing. It offers a unified dataset, accurate reporting, integration with REGIS-TR, and efficient reconciliation, which will help firms to simplify their compliance processes and increase operational efficiency.

Mikkel Mördrup, CEO, TradeChannel, said in a statement: ”With EMIR we saw initial transaction matching reconciliation breaks, that we also expect to see with SFTR. Having an end-to-end reporting solution with REGIS-TR as the end point provides for an efficient reconciliation process…ensuring our client’s compliance.”

TradeChannel Regulatory Reporting hub integrates and captures transactions independent of system used for trading. Regardless if the client reports on its own or partially or fully delegates the reporting, the TradeChannel retrieves reconciliation data from REGIS-TR and reconciles against the clients Book of Records and all transactions and its statuses are visualized in an user-friendly interface.

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Liquidnet acquires UK research tech firm

Institutional investment network Liquidnet announced it has acquired RSRCHXchange, a marketplace and aggregator for institutional research. By combining RSRCHXchange’s technology, research, and distribution with Liquidnet’s AI-based analytics platform, Liquidnet can help its global network of asset managers revolutionize the way they source, access, evaluate, and act on data and insights to enhance investment decisions and generate alpha. Financial details were not disclosed.

“This acquisition brings the worlds of investment research and alternative data together in a fundamentally new approach to alpha creation. We can now support our Member firms across the entire investment spectrum—from idea to implementation,” said Brian Conroy, president of Liquidnet, in a statement.

Launched in 2015, RSRCHXchange’s research marketplace and distribution network digitizes massive amounts of content and provides a centralized, cloud-based hub that allows providers to deliver research, and asset managers to efficiently source it. Approximately 400 research providers regularly contribute to the RSRCHX platform, with nearly 40% of the research coming directly from investment banks and sell-side brokers. To date, approximately 1,200 asset managers subscribe to the platform.

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Deutsche Bank goes with Red Hat for hybrid cloud “Everything as a Service”

Red Hat, a provider of open source solutions, announced that Deutsche Bank is powering its Fabric application platform with open hybrid cloud technologies from Red Hat. Fabric is a key component of Deutsche Bank’s digital transformation strategy and serves as an automated, self-service hybrid cloud platform that enables application teams to develop, deliver and scale applications faster and more efficiently.

The vision was for ‘Everything as a Service’ – to create a bubble where our people can’t tell if they’re building software for a bank or any of the software companies in the world, so as to be able to quickly take an idea to production while meeting the security and regulatory standards of the industry.

Deutsche Bank is among the largest in the world and executes around 13 million payments at a value exceeding €1.1 trillion and clears EUR transactions worth €500 billion each day. Being able to more quickly and efficiently offer flexible, on-demand and always-on services to customers are vital in a highly competitive market like global finance, and cloud-native application development methodologies like containers, microservices and DevOps are well-suited to supporting those goals.

Deutsche Bank built Fabric, a next-generation strategic platform capable of providing an “Everything-as-a-Service” experience for its application teams as they build and deploy new applications across the bank’s hybrid infrastructure.

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Traiana provides central clearing connectivity to Eurex

Traiana, an infrastructure service that provides trade life-cycle and risk management solutions, announced that it has provided direct central clearing connectivity to Eurex. The connectivity allows Traiana to provide venues, trading parties and clearing members with an end-to-end clearing solution for OTC interest rate swaps.

By connecting Traiana’s Clearing Hub with Eurex, market participants can submit trades executed on electronic trading venues for clearing. They also benefit from Traiana’s Credit Risk Hub (LimitHub) which provides pre-trade checks for client orders placed on regulated trading venues and post-trade checks for voice executed trades; both requirements under MiFID II in Europe and Dodd-Frank in the United States.

Traiana’s direct central clearing connectivity with Eurex assists clearing members managing client limits with their post-trade workflows and supports clients who allocate on a post-trade basis using a standby broker with “Bunched Orders”. The connectivity reflects the increased demand from market participants for access to Eurex Clearing OTC IRD clearing services.

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