Hong Kong Exchanges and Clearing (HKEx) has acquired a 15.6% stake in electronic bond trading portal BondsInAsia (BIA), giving it equality with existing investors, HSBC, Deutsche Bank, Citigroup, BNP and CSFB, with the balance held by Reuters and BIA management. New shares were issued for the deal, but the price was not announced.
BIA was launched by major bond traders HSBC, Deutsche Bank and Citigroup in July 2000, but has yet to make significant inroads into the conservative bond trading sector. Chief Executive Albert Cobetto said yesterday the biggest volumes traded on the portal so far had been in government bills and exchange fund notes.
Mr Cobetto said: "It is an exciting time for the bond markets in Asia. Together with HKEx, we have the common objective to grow and develop the fixed-income securities markets in Hong Kong and other major markets in Asia.
"By collaborating on this initiative and leveraging our mutual resources and infrastructures, we are confident we can deliver Asian fixed-income products more efficiently and continue to maintain our position as the leading fixed-income trading platform in Asia."
HKEx Chief Executive Kwong Ki-chi said he was keen to develop Hong Kong's bond market. "The BIA system allows its users to trade a wide range of Asian fixed-income securities in their local currencies as well as in the G3 currencies - the US dollar, the Japanese yen and the euro," he said.
"HKEx's investment in BIA will facilitate access via the exchange to BondsInAsia's proprietary electronic trading platform. This will help to encourage the development of a more active bond market in Hong Kong."
Nearly US$3bn of bonds are traded in Hong Kong every day, generating substantial fee income for the bond traders who have traditionally dominated the business.
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