EuroMTS Limited has introduced a new market for the trading of Sovereign, Agency, and Supranational bonds of 2 to 5 billion outstanding.
The trading platform says that trading via the MTS Quasi Government Market will complement trading of the same issuers’ EuroBenchmark Bonds, or bonds of 5 billion or more, already occurring through EuroMTS and will buoy liquidity for issues of 2-5 billion. The issuers include Depfa, the European Investment Bank, Freddie Mac, Infrastructure S.p.A. and KfW.
In conjunction with the launch of the new MTS Quasi Government Market, Network Rail, a UK-based railway agency, was listed on MTS for the first time.
“EuroMTS has come to represent the benchmark for European agency and supranational bonds, as well as European sovereigns,” says Gianluca Garbi, chief executive officer of EuroMTS. “The new MTS Quasi Government Market allows for a greater number of these types of bonds to prosper from our unparalleled liquidity and transparency and upholds our strategy of enhancing liquidity for the greatest possible number of European securities.”
In order to be eligible for inclusion in the new market, bonds must be at least 2 billion, but are not required to meet the 5 billion mandatory for EuroBenchmark Bond status. Bonds in the MTS Quasi Government market will be guaranteed liquidity by at least eight market makers. Network Rail’s recently issued 2.5 billion 3.125% 2009 immediately benefited from support by Barclays, Citigroup, Dresdner Bank, HSBC, Merrill Lynch, Royal Bank of Scotland, UBS, and WestLB.
“Network Rail bonds have already benefited from the expected liquidity inherent to the new MTS Quasi Government market,” says Jean-Marc Mercier, Deputy Head of Syndicate at HSBC. “As lead manager and global coordinator on this deal, we are confident that the launch of such a market will bolster liquidity for bonds for this segment of the Eurobond Market.”