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NYSE Euronext launched NYSE BondMatch, its new trading platform for European bond market professionals – bankers, brokers and institutional investors – last July 11. NYSE BondMatch allows investors to trade 1,300 corporate, financial and real estate bonds in a transparent order book that is limited to firm orders. "Previously, 90 to 95% of trading on the bond market was OTC. With NYSE BondMatch, issuers now have visibility over prices and can consult the value of their debt. This transparency has multiple advantages for issuers, in particular helping them better prepare for future issues," says Nathalie Masset, Deputy Director for NYSE Euronext European bond markets.
To be traded on NYSE BondMatch, bonds must be issued in Euros, total a minimum of €500 million, and be of investment grade. All shares must also be listed on a regulated market in Europe and be accepted for clearing by LCH.Clearnet.
"It is too soon to fully assess the new market, but we note with satisfaction that orders were completed from its very first day of business, and that on the most active trading days, prices are formed for around 800 bonds," says Ms Masset.
For bond issuers, price transparency extends to post-trade information, which is immediately published on Reuters and Bloomberg. At the same time, NYSE Euronext informs each issuer of the types of players who are most actively interested in their shares.
Finally, because trading fees on NYSE BondMatch are public, an issuer who wishes to buy back its shares is able to estimate the cost of the operation.