For the global precious metals marketplace, Autilla Ltd. today announces the selection of TESS Connect & Go from Cinnober Financial Technology as its platform to migrate its precious metals Over-the-Counter (OTC) broking onto a proven electronic trading platform.
The international OTC market for gold, silver, platinum and palladium is centered in London, with wholesale bullion banks trading millions of ounces of precious metals daily. These OTC transactions rely on bilateral credit agreements, which are costly and expose the banks to counterparty credit risk and increasing balance sheet cost. Dodd-Frank in the U.S. and impending European EMIR & MiFID regulations will increasingly require electronically traded, centrally cleared and daily monitored transactions.
The majority of interbank transactions currently pass through traditional voice brokers. New requirements for transparency on pre- and post-trade price discovery and trading are pushing the market towards an electronic solution.
"There's still someone at the end of the line if needed, but price discovery and trading will be clear and transparent, protecting our clients and the integrity of the marketplace," adds Greenacre.
London-based Autilla specializes in options and derivative hedging instruments on physical metals, coal and iron ore, metal mine finance and off-take. With its new electronic platform Autilla will be able to provide banks with a fungible technology-based solution to regulatory requirements. The platform will be an Organized Trade Facility (OTF) solution, providing a European regulatory based service, solving compliance, trade and price reporting, as well as balance sheet issues and client requirements.
The TESS Connect & Go SaaS solution from Cinnober enables trading venues to set up a regulation-compliant market and provides access to state-of-the-art marketplace technology that is fully compliant, in a full-service concept. This means a low-risk investment, superior total cost of ownership and ability to focus fully on core business. It's an agile solution that can be used for a wide variety of asset classes and is easily adapted to most types of specialized marketplaces.