TradeWeb Launches Online Mortgage-Backed Securities Market
- MBS Market Represents Fifth Application of Company's Multi-Dealer Auction Model -
New York, NY (May 8, 2001) -- TradeWeb, the leader in online bond markets, today announced the official launch of its market for the trading of TBA mortgage pass-through securities (TBA-MBS), the most liquid sector of the mortgage-backed securities market. Institutional investors globally now have the opportunity to simultaneously access the liquidity of TradeWeb's dealers for the TBA-MBS market - Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, Lehman Brothers, Merrill Lynch, Morgan Stanley and Salomon Smith Barney - which combined represent a majority of the dealer-to-customer volume done on the Mortgage-Backed Securities Clearing Corp. (MBSCC).
TradeWeb's TBA-MBS market is the fifth online market supported by the company's multi-dealer auction technology. The launch follows a highly successful two-month beta test during which approximatedly 40 institutional investors and dealers traded 30-year and 15-year fixed-rate TBA-MBS. Trading volume during this period exceeded $45 billion with an average trade size of more than $900 million and a single outright trade of $250 million.
Jim Toffey, President and CEO of TradeWeb, said "The launch of TradeWeb's online TBA-MBS market is a further testament to the effectiveness and scale of our global fixed-income trading network. With the support of our dealers and institutional customers, we are committed to being the number-one online TBA-MBS marketplace."
Subscriptions to TradeWeb's online TBA-MBS market will have access to live two-sided pricing for the TBA coupon curve that comes directly from participating dealers. TradeWeb displays the best bid and offer price for each security, and results are displayed on efficiently organised pricing screens. With hundreds of thousands of price updates daily, the TradeWeb TBA-MBS market is certain to distinguish itself as the best source of TBA-MBS price information, and the most efficient way to trade TBA-MBS securities online.
Customer reaction to TradeWeb's online TBA-MBS market has been extremely positive. According to Scott Miller, MBS trader from State Street Global Advisors, "We are impressed by the TradeWeb platform. To be able to get good indicative levles and then get clean efficient trade execution from the dealers will serve to add liquidity to the market. The efficiency and accuracy of TradeWeb may allow accounts to trade more aggressively. The bottom line from a customer's perspective is that not being on TradeWeb TBA-MBS becomes a disadvantage."
The commitment of the dealer community has been critical and their views of the product are impressive: Rick Redmond, managing director at Lehman Brothers, said: "Electronic trading of TBA-MBS has arrived. TradeWeb will enhance market liquidity and provide price discovery, which is so important to our clients."
Jim Galgano, head of pass-through trading at Morgan Stanley, added: "Based on the impressive trading volume and positive feedback from our beta participants, we are looking forward to a successful full launch of TradeWeb TBA-MBS to our entire client base."
Trip Mestanas, the head of pass-through trading at Goldman Sachs, said: "The critical mass of dealers on the platform, combined with the added efficiency of the TradeWeb real-time trading technology, is a powerful value proposition for customers."
Tom Hamilton, a managing director at Salomon Smith Barney, added: "Electronic trading is going to be essential for the future of the mortgage market, and TradeWeb is providing the efficient auction platform for dealers and investors."
Harley S.Bassman, a managing director at Merrill Lynch, said: "Changes in the financial markets over the past few years have greatly increased the value of transparency and liquidity. The TradeWeb platform uniquely enhances both."
Jonathan Zames, the head of pass through trading at Deutsche Bank, said: "TradeWeb continues to enhance its value to customers through the edition of TBA-MBS to its suite of products. We look forward to providing our liquidity to better serve our clients."
Sachin Jhangiani, a 30-year mortgage pass-through trader at Credit Suisse First Boston said: "TradeWeb is a complement to our mortgage distribution network. We recognise TradeWeb's value in providing efficient trade execution capability to our customers."
Headquartered in New York, TradeWeb is the leader in online fixed-income markets with more than 900,000 trades executed with total volume exceeding $4 trillion since its inception in 1998. TradeWeb's multi-dealer model links 13 of the world's leading dealers of fixed-income securities with more than 750 buy-side institutions in North America and Europe. In addition to TBA-MBS, the company's technological platform is utilised to enable clients to trade U.S. Treasury and Agency securities, Euro Sovereign and Commercial Paper (currently in beta testing). For more information on TradeWeb, please visit the company's website at www.tradeweb.com