Mumbai:
Seven of the biggest investment banks in Europe have
announced the formation of a pan-European electronic share-trading
platform. The banks said they would form a company with
the goal of creating a trading platform for equities.
The plan groups Citigroup Inc, Credit Suisse Group, Deutsche
Bank AG, Goldman Sachs Group Inc, Merrill Lynch &
Co, Morgan Stanley and UBS AG.
An independent team would manage the new trading platform,
the financial institutions said in a statement. The venture,
expected to be up and running in 21008, follows the European
Union's Markets in Financial Instruments Directive (MiFID),
which takes effect in November 2007.
The EU directive allows creation of new trading platforms,
or multilateral or cross-border trading facilities among
member states of the European Union.
The
new stock exchange would compete directly with the London
Stock Exchange and other continental markets.
If
the scheme goes ahead it will provide banks, fund managers
and other institutions with a trading platform quite independent
of the various national exchanges.
The
new platform would allow banks to trade electronically
in a wide range of leading European equities, including
index trading on the FTSE 350.
The
move also comes amidst news of takeover and merger bids
among bourses that could exert downward pressure on their
fees and
margins. While the London Stock Exchange is eyeing acquisition
in Asia, especially India, Euronext is trying to merge
with the New York Stock Exchange.
The
banks said they have already begun meeting with European
regulators and authorities.
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