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[SWAPSWIRE LOGO]
For immediate release 10 April 2000
LEADING DERIVATIVE DEALERS ANNOUNCE SWAPSWIRE - A PIONEERING INTEREST RATE
DERIVATIVES ELECTRONIC DEALING NETWORK
Six of the leading derivative dealers announced their plans to form a network
and protocol for on-line trading and negotiation of interest rate derivative
transactions. The six institutions have signed a letter of intent and expect,
subject to regulatory and other applicable approvals, to form a joint venture in
which each party will have an equal interest.
Chase Manhattan Bank, Citigroup, Deutsche Bank, J.P. Morgan, Morgan Stanley Dean
Witter and Warburg Dillon Read (a division of UBS AG) intend to create a joint
venture called SwapsWire, dedicated to developing the electronic trading of
interest rate derivatives. The founding members will work with market
participants in the development of the network to promote its adoption as an
industry standard. The founding members anticipate that their sponsorship will
facilitate the successful implementation of this new way of doing business for
the interest rate derivatives market. The new system will initially be aimed at
professional dealers in benchmark swaps but will look to expand its services to
cover all participants in the interest rate derivatives market, including
end-user clients.
SwapsWire is expected to become the leading communication and trading
infrastructure for the interest rate derivative community and to enable
participants to:
- - Trade benchmark swaps, and other interest rate derivatives, on-line, with
the costs and efficiency of electronic dealing, and the benefits of Over
The Counter (OTC) private negotiation;
- - Securely view indicative or live prices, indications of interest, and
full details of executed transactions in a standard format ;
- - Transfer deal information swiftly and securely between counterparties in
a standard format.
SwapsWire plans to provide the following benefits for participants:
- - Adoption of industry wide standard protocols;
- - Straight through processing for the interest rate derivative markets;
- - Substantial cost savings from replacing the current labour intensive, non
standard, and manual settlement process;
- - Replacement of paper documentation with electronic equivalents;
- - Flexibility to choose services according to needs.
The system is due to be tested towards the end of this year in the US$ and Euro
interest rate swap markets among the founding members and will be more widely
distributed in Q1 2001.
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A SPOKESPERSON FOR THE FOUNDING MEMBERS COMMENTED:
"SwapsWire is a pioneering dealer sponsored initiative to allow interest rate
derivatives to be traded electronically and bring to the industry the efficiency
benefits associated with on-line dealing. SwapsWire is intended to allow for the
trading of interest rate derivatives electronically, to promote the adoption of
standard protocols in our industry, and, ultimately, to lead to straight through
processing. We plan to work with all market participants to encourage widespread
use of the system. SwapsWire will be committed to spreading the value of the
system as widely as possible, and our clients will be an important focus of our
plans."
Press enquiries: contact Michael Webster, Brunswick Group on 0207 325 4056
Further details of SwapsWire are available online at www.swapswire.com.
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NOTES TO EDITORS
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CHASE MANHATTAN
The Chase Manhattan Corporation (www.chase.com) is a premier global financial
services firm with assets in excess of $400 billion. Chase combines the best of
commercial and investment banking, offers world-class information and
transaction processing services, and has a leading U.S. consumer franchise that
serves 32 million customers. Through its newly formed business unit Chase.com,
Chase is successfully creating innovative business models for the New Economy.
Chase, with offices in more than 45 countries, has a presence in all of the
principal centers around the world.
CITIGROUP
Citigroup's Global Corporate and Investment Bank brings together the world's
most global corporate bank, Citibank, with a leading global investment bank,
Salomon Smith Barney, to provide complete financial solutions to corporations,
governments, institutions and individuals in 100 countries. Award-winning
businesses include corporate and investment banking services, investment advice,
financial planning and commercial insurance products. Additional information on
Citigroup (NYSE: C) can be found at www.citigroup.com.
THE DEUTSCHE BANK GROUP
The Deutsche Bank Group, headquartered in Frankfurt, Germany, is the world's
largest financial services group with total assets exceeding EUR800bn. The Group
is represented in 68 countries and employs more than 90,000 people.
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The Bank is split into five business divisions - Global Corporates and
Institutions, Asset Management, Global Technology and Services, Corporates and
Real Estate, and Retail and Private Banking.
The Global Corporates and Institutions division (GCI) is the wholesale banking
arm of the Deutsche Bank Group. It provides an integrated investment and
commercial banking service to the world's leading companies and financial
institutions. The GCI division aims to provide clients with sophisticated
financial solutions to their business requirements by combining the bank's
unrivalled balance sheet with world-class capital markets, corporate advisory
and strategic risk management capabilities.
J.P. MORGAN
J.P. Morgan is a leading global financial services firm that meets the critical
financial needs of business enterprises, governments and individuals. The firm
advises on corporate strategy and structure, raises capital, makes markets in
financial instruments, and manages investment assets. It also commits its own
capital to promising enterprises and invests and trades to capture market
opportunities. The firm's web address is www.jpmorgan.com.
MORGAN STANLEY DEAN WITTER
Morgan Stanley Dean Witter & Co. is a preeminent global financial services
company and a market leader in securities, asset management, and credit
services. The company's top-ranked research, along with world-class product
origination, asset management and other extensive resources, create a unique
combination of capabilities that provide both individual and institutional
clients with access to the most comprehensive array of high-quality products and
services in the financial services industry today. The company has offices in
New York, London, Tokyo, Hong Kong and other principal financial centers around
the world and has 488 branch offices serving individual investors throughout the
United States.
WARBURG DILLON READ
Warburg Dillon Read (WDR) is the investment banking division of UBS AG, one of
the largest financial services companies in the world. WDR provides investment
banking services to corporate, institutional and sovereign clients worldwide. It
was created in the summer of 1998, the product of the merged investment banking
businesses of Union Bank of Switzerland and Swiss Bank Corporation.
Headquartered in London, WDR employs more than 13,000 people around the world.
http://www.wdr.com