- Bloomberg VCON helps reduce costs, market risks and meet mandates of DoddâFrank Act
Bloomberg today announced that VCON, the firmâs voice trade confirmation system for cash and derivative instruments, is the first to connect buy-side and sellâside firms to multiple central clearing counterparties (CCPs) for interest rate swaps (IRS) central clearing.
Bloomberg also announced that Citadel LLC, Freddie Mac and PIMCO are among the firms now using Bloombergâs VCON industry workflow solution to connect to CME Clearing. Other clearing houses already connected via the Bloomberg tool are the Intercontinental Exchange (ICE) & CME Clearing for Credit Derivatives, and the International Derivatives Clearing Group (IDCG) for IRS. Clients also have access to LCH.Clearnetâs Swapclear service through Bloomberg VCON's integration with MarkitServ.
Bloombergâs VCON is a multiâasset class system that allows for all postâtrade communications and affirmations to be completed on one platform. Bloomberg clients are able to match trades, integrate them with Bloomberg analytics, and send those trades directly to all major CCPs for IRS and credit default swaps (CDS).
âBloombergâs VCON interface has become a widelyâaccepted industry utility, providing clients with a centralized hub for credit derivatives clearing,â said Ben Macdonald, Bloombergâs Global Head of Fixed Income Trading. âBy adding the ability to clear interest rate swaps, Bloomberg provides clients with a comprehensive, easy to use, efficient and costâsaving solution that will help mitigate market exposure and meet the latest regulatory requirements.â
Kim Taylor, President of CME Clearing, said, "With Mondayâs launch, CME Clearing establishes an open standard API for platforms such as Bloomberg, to send affirmed trades directly to a clearing house or CCP. CME Clearing, in conjunction with its technology partners, has set a new standard for STP efficiency. We look forward to working with Bloomberg to deliver an enhanced endâuser clearing experience."
Gerald Beeson, COO of Citadel, said, "We feel this development in the launch of the Interest Rate Derivative market here in the U.S. is an important step forward and will provide further momentum in connection with fulfilling the promise of central clearing of derivatives. We welcome the opportunity to be an early adopter of CME's platform and hope this is a catalyst for launch of similar efforts across other derivative markets. Bloomberg has been a valued technology partner in helping us achieve this with their VCON product."
John Shay, coâfounder and Chief Marketing Officer of IDCG, said, âIDCG has been receiving trades from VCON since early September and have found it to be useful in the transition from OTC to our clearinghouse. IDCG has received very positive feedback about VCON since customers starting using it to deliver trades to IDCG in early September. We feel platforms with multiple connectivity options like IDCG and Bloomberg's VCON will help ease transition into the cleared environment for OTC derivative users.â
Bloomberg announced the firstâever interface to CDS clearing in January, which is already widely inâuse by the firmâs clients. This addition to the VCON interface further builds out Bloombergâs capabilities as a provider of execution and postâtrade services in the global market for overâtheâcounter (OTC) derivatives. Currently VCON supports all Fixed Income cash products, foreign exchange (FX), Futures, Options, IRS, and CDS, including novations and unwinds.