MarketAxess, Tradeweb and Bloomberg plan joint EU bond price feed

The euro sign is pictured in front of the former headquarters of the European Central Bank in Frankfurt, Germany April 9, 2019. REUTERS/Kai Pfaffenbach

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LONDON, June 22 (Reuters) – MarketAxess, Tradeweb and Bloomberg said on Wednesday they were exploring a single price stream for corporate and government bonds in the European Union as the bloc seeks to better integrate its capital market.

The EU plans to change its securities rules to require a single price stream, or “consolidated band”, of trading across different platforms in the bloc for investors and banks, helping to tighten markets and improve data quality.

“The Consolidated Band Service is expected to be provided – subject to relevant regulatory approvals – through a joint venture established and operated independently of our respective businesses,” Tradeweb, MarketAxess and Bloomberg said in a joint statement.

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All three already manage their own Approved Publishing Agreements (APAs) for transaction reporting.

The bill is being negotiated by EU states and the European Parliament, but it is unclear when the final green light will be given as stock exchanges push back on the operation of a strip for stocks. Read more

There are already bands of stocks and bonds in US markets, and Britain is also considering a band in the fixed income market.

The EU is considering bands for a range of asset classes, with the procurement process, authorization and oversight handled by the bloc’s European Securities and Markets Authority (ESMA).

“We believe the draft legislative revisions proposed by the European Commission would open a window to develop a strong consolidated band that will increase market transparency and help facilitate a single, integrated European capital market,” the three companies said.

“As a next step, we are preparing a competitive information process request to review independent third-party technology and operating partner(s) for the Consolidated Band Service.”

A key problem for a bond band to solve is how to better normalize deferrals, or the length of time data is released after the trade to make a band more timely.

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Reporting by Huw Jones Editing by Mark Potter

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