Singapore Exchange (SGX) has successfully launched SGX Bond Pro, the first Over-The-Counter (OTC) trading venue dedicated to Asian bonds, it said on Thursday (Dec 10).
SGX Bond Pro has been established under SGX's subsidiary, SGX Bond Trading ("SGX BT"), a licenced recognised market operator. It connects buyers and sellers of Asian bonds and provides them with multiple trading protocols that cater to their liquidity needs.
The trading protocols were developed in consultation with the industry to facilitate how participants, including accredited investors such as global asset managers, private and investment banks, want to access liquidity.
"The secondary Asian bond market faces an institutional liquidity challenge as a result of increasing fragmentation and concerns among participants of information leakage and subsequent market impact resulting in a prevalence of small trade sizes," the SGX said in a statement.
"SGX Bond Pro aims to address this through features that re-aggregate liquidity, provide enhanced protections for institutional investors and encourage larger trade sizes."
SGX Bond Pro began trading Asian corporate bonds in G3 currencies, with Asian local currencies to follow.
Swiss private bank UBS was announced as the general counterparty for SGX Bond Pro in October 2015.