The London Stock Exchange (LSE) and Oslo Børs have revealed details about how they will cooperate, following the strategic partnership the two exchanges announced last December.
Under the agreement the LSE will provide Oslo Børs with its TradElect trading platform for equities and fixed income markets, as well as Infolect, the LSE’s high-speed data dissemination tool. The migration to TradElect is due to take place in Q1 2010, subject to client readiness.
The move will increase access to the cash equities markets of the LSE, Borsa Italiana and Oslo Børs as all three will be using TradElect and a harmonised trading model, according to the LSE. The potential for cross membership between the three exchanges will also be explored.
In addition, Oslo Børs will implement SOLA, the derivatives trading platform the LSE licensed earlier this week from Canadian exchange operator TMX Group, by November this year. LSE and Oslo Børs will also explore cooperation in areas such as regulatory policy, operational regulatory processes and the sharing of market information for regulatory purposes.
Migration to the TradElect and SOLA trading systems is likely to involve project costs for Oslo Børs of just over NOK 60 million (EUR 6.8 million). Assuming the same levels of trading volume and trading revenue for Oslo Børs in 2008, the annual cost of using TradElect and SOLA is estimated to be around the same as using the current trading systems.
“This is a natural development for Oslo Børs, increasing our distribution network throughout Europe. We believe this partnership will enhance both liquidity and the general interest in our market,” said Bente Landsnes, CEO of Oslo Børs, in a statement. “By combining our complementary strengths, both exchanges will gain from the partnership, helping us better serve our customers.”