Wednesday, November 15, 2006

Equiduct responds to MTF announcement

Below I have pasted Bob Fuller, CEO of Equiduct's response to the announcement by seven leading investment banks that they will launch an electronic trading platform to rival the leading European exchanges.

Unlike the consortium of investment banks, which will build a multilateral trading facility or MTF, Equiduct, which will also launch in 2007, aims to provide a pan-European platform for trading liquid shares post-MiFID. Although the announcement by the consortium of Tier 1 investment banks signals that they will build their own solution, Fuller anticipates that there will be enough appetite for its pan-European platform amongst Tier 2 and Tier 3 investment banks that do not want to shoulder the upfront investment costs associated with MiFID compliance.

"Today's announcement that a group of seven leading investment banks will confirm detailed plans to launch a trading rival to the London Stock Exchange is exciting news, and confirms the growing market requirement for alternative solutions to help meet the challenge of MiFID implementation within Europe," says Fuller.

"At Equiduct we believe that their announcement validates our analysis on the need for MiFID-compliant, Europe-wide trading. However it's interesting that they've decided to go down the MTF route, rather than opting as Equiduct has done to set up as a fully regulated pan-European electronic platform.

"This, coupled with our open access to clearing and settlement providers, gives us a distinctive proposition. We'll also be interested to see how the European marketplace relates to an offering owned by a small number of Tier-1 banks.

"With Equiduct we'll be primarily focusing on the significant number of Tier-2 and Tier-3 investment banks that can't afford to build their own solutions, however we also expect that we'll be continuing our discussions with Tier-1 investment banks including many of those currently involved in other projects as we're finding that our platform brings solutions regarding MiFID best execution that cannot easily be replicated

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