Crédit Agricole has become the first bank to provide sponsored access to its buy-side clients on London Stock Exchange-owed non-government bonds platform MTS Credit – but the bourse says it is in no hurry to add others immediately.
MTS Prime, a part of the MTS Credit service, allows institutional investors to access liquidity and price transparency by trading directly on the order book via their relationship with a prime bank.
Fabrizio Testa, head of product development for the platform, said he expected Crédit Agricole's participation to encourage other banks to subscribe to the service, which is regulated by the Financial Conduct Authority, but added that MTS was "not in a rush".
"The aim of any project is to attract more players. With the first sponsor now on board, we may see others speed up their processes," he said.
But he added: "It's more important to us that things are done properly. We want to make sure all participants are comfortable. Because it's an extension of something that already exists, we wanted it to be well understood and well organised. That's why it's happening now, and not before."
Testa said the development was a response to buy-side and sell-side demand for a platform specifically for the credit market. The bourse trades 2,400 corporate, covered and sub-sovereign, supra and agency (SSA) bonds.
"It's important that this third way of trading credit is backed by both sell-side and buy-side participants," he said. "It's a response to recommendations within the context of a new trading protocol. Participants are already connecting to the market but this gives them another optionality and we'll see how they use it," he said.
"The buy-side can already transact but a large part of their activity still takes place over the phone. Our aim is to give as many tools as we can to get them to trade electronically."