Cinnober Acquires Boat Trade Reporting

Terry Flanagan

Cinnober Financial Technology has acquired Boat, the trade reporting business, which will provide an opportunity to expand its client base to banks and brokers.

In a statement, Cinnober said it took full control of Boat’s European trade reporting service from data provider Markit on July 1.

Jamie Khurshid, chief executive of Cinnober’s Boat Services, told Markets Media: “Cinnober has provided world class technology to clearing houses and exchanges but not so much to banks and brokers. This is our opportunity to offer our technology products as a service to this particular sector.”

Markit, Boat’s previous owner, had announced plans to discontinue trade reporting in September after exchange operator Bats Chi-X Europe launched a rival product six months ago.

Boat was founded in 2006 by a consortium of banks in order to create a neutral reporting hub with the introduction of new regulations such as MiFID and Cinnober has provided the core technology since its inception. In 2007 Boat was sold to Markit.

“The reasons for setting up Boat in the first place are still very pertinent today and there certainly is customer demand for a high quality independent service,” added Khursid.

Cinnober said more than 40 investment firms and MTFs report trades and quotes to Boat, which is more than any other platform.

BXTR, Bats Chi-X Europe’s on- and off-exchange trade reporting service, has a market share of 55% according to Thomson Reuters and the exchange.

The exchange said in a statement today it has added Deutsche Bank, KCG, Instinet and Liquidnet as BXTR clients. A further six clients are either on board or will be added by the end of the summer according to a spokeswoman.

Mark Hemsley, chief executive of Bats Chi-X Europe said in a statement: “With over €308bn reported to BXTR in June, the service provides an invaluable insight into the way the modern European marketplace moves and we will be further refining the picture of what constitutes truly addressable liquidity through the FIX Trading Community Market Model Typology (MMT) standard.”

In February the Federation of European Securities Exchanges and FIX Trading Community announced that Market Model Typology (MMT) has become a FIX standard which will allow standardisation in data from trading or trade reporting venues. FESE said MMT can also be used by non-FIX protocols which will make it easier to aggregate data from multiple venues and create a European consolidated post-trade tape.

Dale Brooksbank, head of European trading at State Street Global Advisors told Markets Media in February: “MMT is already going to be standard reporting for Bats, which has been a step forward versus Boat.”

Hemsley told Markets Media in February: “Boat had decreased costs but was not successful in providing high-quality data of the sort needed by European regulators.”

Khurshid said that in the short-term, Cinnober wants to update Boat’s data reporting standards and implement changes such as MMT and the FIX community’s best practices.

In the medium-term Khursid said Cinnober wants to help clients meet more of their reporting obligations across all asset classes and instruments so they only have to maintain one line to Boat and reduce their technology costs.

“In the long-term Cinnober could well end up being the best service for all our customers to meet their respective trade and transaction reporting requirements by centrally connecting all the trade repositories and reconciling data between them,” he added. “Rather than just remaining a trade reporting service Cinnober could, in the future add value to Boat by creating a European service hub that addresses all regulatory obligations for our customers.”

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