MTS and Wematch launch new risk netting service for interest rate swaps

New functionality builds on MTS Swaps, the trading venue for the interest rate swaps market, launched earlier this year.

European electronic fixed income platform MTS and fintech have run their first session of The MTS Swaps Risk Netting Service – their session-based trading functionality for interest rate swaps (IRS).

The session was run on 20 June and was a 3 month vs 6 month EURIBOR (3m/6m) basis session, which executed trades across several participants and tenors.

The new functionality compliments MTS Swaps, a digital interdealer trading venue for interest rate swap dealers (accessible through a web browser via which was announced in February this year.

Users are able to manage their risk across their IRS portfolios during regularly scheduled risk netting sessions in 3m/6m, €STR/EURIBOR, and Eurex/LCH basis.

Steve Schiff, head of risk netting services at highlighted the “significant milestone” represented by the launch, and its role in enhancing liquidity in the interest rate swaps market.

“The session-based functionality of the Service enables participants to effectively manage risk in bulk across their portfolios, fostering efficiency and mitigating PnL volatility: we are proud to be at the forefront of innovation and look forward to further collaboration with MTS as we build out new liquidity pools for the rates market,” he said.

According to the businesses, The MTS Swaps Risk Netting Service is the only platform for automated risk netting of IRS inclusive of trading constraints, PnL controls and contingencies.

MTS – part of Euronext Group – has also announced plans to launch dealer-to-client RFQ trading functionality for IRS, BondVision Swaps, expected early next year.