The Depository Trust & Clearing Corporation (DTCC), working with leading inter-dealer brokers, announced today the launch of AffirmXpress, a single-screen affirmation platform that allows traders and front-office staff to affirm credit derivative trades from multiple inter-dealer brokers (IDBs) at the point of trade.
AffirmXpress, which will improve efficiency and support the growth of the credit derivatives market, marks another major milestone in the industry’s continuing efforts to automate processing in this market.
In the initial pilot, DTCC is partnering with three leading IDBs – GFI Group (GFI), ICAP, and Tullett Prebon – and will complete testing by the end of June. AffirmXpress will be expanded to include other IDBs next year. Several major dealers have committed to use AffirmXpress, and others are in the pipeline.
"AffirmXpress addresses one of the OTC derivatives market’s biggest challenges – immediate trade affirmation of brokered transactions," said Gina Ghent, DTCC’s vice president of Business Development. "AffirmXpress will automate this process, and will soon give trading counterparties the option to submit their affirmed trades directly to Deriv/SERV, DTCC’s automated matching and confirmation service. Through this streamlined process, a trade could be legally confirmed within seconds of affirmation."
Initially, AffirmXpress will support credit derivatives, including single-name and index credit default swaps (CDS), and tranched index swaps. Future releases will include interest rate and equity derivatives products. AffirmXpress will be offered to the industry at no charge for at least the first year.
"Our goal with AffirmXpress is to encourage automation as early as possible in the trade life cycle to reduce operational risk, while giving customers easy access to the tools they need to deal with the growing volume of credit derivatives trades," said Ghent.
"We’re committed to helping our clients improve efficiency, reduce errors, and support the growth of this important market," said Michael Fuhrman, GFI’s head of e-trading – North America. "From our perspective, a one-stop affirmation service will result in dramatic time-savings for our clients by reducing the effort traditionally associated with this front-office process."
"We stepped forward to work with DTCC and the other IDBs because we strongly believe that this combination of market leaders, and the recognized standard in CDS post-trade matching, delivers the solution for improved trading efficiency in the interdealer markets," said Chris Ferreri, managing director, ICAP. "AffirmXpress is an example of the efforts we make to serve the needs of our customers as new products and challenges enter the market."
"The collaborative effort means we are quickly delivering a front-end affirmation service to the global credit derivatives market," said Toby Young, global head of Trading Technology, Tullett Prebon. "AffirmXpress linking with Deriv/SERV for automated confirmation and legal execution further streamlines post-trade processing for our customers."