GTSM launches online int'l bond trading

The inauguration ceremony was officiated by Vice Premier Eric Chu, GTSM Chairman Chen Shuh and officials from the Financial Supervisory Commission.

Chu said the online connection of the electronic trading system with the U.S. bond market marks a major step for the local bond market towards internationalization as local securities brokers will be able to trade U.S. bonds directly via the GTSM's system.

The GTSM established the strategic cooperation with ICAP, the world's largest electronic inter-dealer broker for U.S. Treasury securities, and JP Morgan, the largest clearing bank for the U.S. Federal Reserve System, to provide the trading platform — U.S. Treasuries Trading Platform.

The electronic trading platform can save at least half of the transaction fee and custodian fee for local traders to lower their trading costs of U.S. government debts, a GTSM official said. Five local brokerage houses joined yesterday the trading platform, which connects to ICAP's electronic trading platform BrokerTec and operates 22 hours a day, the official added.

“With the trading volume of Taiwanese bond markets having shrunk more than 50 percent so far this year, the U.S. Treasuries trading platform brought us a new commodity — also a new opportunity,” said Jeff Chen, vice president of the bond department at Capital Securities, which was among one of the first securities to log on the platform.

Nearly 60 percent of the U.S. government debts are traded via BrokerTec; and in the Asia time zone, BrokerTec accounts for more than 80 percent of fixed income market share, the GTSM said.

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