TP ICAP’s Liquidnet expands EM bond offering with access to South Africa

Liquidnet, an institutional trading and equities network, is onboarding South African institutions onto its electronic bond trading platform, in partnership with its parent TP ICAP’s arm in the country.

The agency broker announced an initiative to bring more than 20 asset managers and pension funds who represent the majority of the global liquidity in local rand denominated debt. Additionally, the move caters to Liquidnet’s investors who are actively trading emerging markets. Thanks to its alliance with TP ICAP, they now have access to new liquidity in the South African bond market.

The move is intended to boost Liquidnet’s emerging markets franchise and offer a range of execution services including client coverage, sales trading and trading. The strategic integration also leverages the existing geographic infrastructure and expertise within the TP ICAP Group.

Participants in Liquidnet’s EM business nearly doubled in less than four years, from 90 asset managers in 2018 to over 390. The company’s coverage also extends to six local debt markets including Mexico, Turkey, South Africa, Czech Republic, Hungary, and Poland.

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Mark Russell, Global Head of Fixed Income at Liquidnet, comments: “Liquidnet continues to excel in bringing market participants together. With 72%* of South Africa bonds owned by domestic investors, we recognize the incredible value these firms will bring to the platform for the benefit of all in the Liquidnet community.”

Paul Wilson, COO of TP ICAP South Africa, added: “Trading in South Africa continues to evolve into a more diverse, international marketplace. We have a 30-year track record in the country of being one of the best liquidity providers for this market and partnering with Liquidnet will allow us to deepen our liquidity proposition and elevate the service we provide to our customers.”

Since launching in September 2015, Liquidnet’s community of fixed income asset managers has grown to 1,000 asset management and hedge fund clients, who collectively manage $33 trillion in equity and fixed income assets. This growth has been fueled by members’ ability to trade in institutional size with an average execution of $2.4 million.

Additionally, Liquidnet has been expanding its portfolio by buying more AI and alternative data offerings. The first step was the acquisition of OTAS Technologies in 2017, followed by RSRCHXchange and Prattle in 2019.

Liquidnet made headlines after TP ICAP, the world’s largest interdealer broker, acquired the private trading operator. The deal valued Liquidnet between $600 million and $700 million.