Clearstream, LuxSE Invest In Digital Bond Issuance Fintech

State Street Automates Fixed-Income ETFs
  • Clearstream and the Luxembourg Stock Exchange invest in London-based fintech Origin
  • Partners seek to jointly develop solution to automate bond issuance processes
  • Initial scope of the partnership includes international medium-term notes (Eurobonds)

Deutsche Börse Group’s post-trade services provider Clearstream and the Luxembourg Stock Exchange (LuxSE) have announced a Series A investment in Origin, a London-based fintech company focused on digital bond issuance. The partners aim to automate the bond issuance process from origination through to settlement. LuxSE acquired an initial stake in Origin in 2019 and will be following-on in this round. The investment transaction is expected to be completed in Q4/2020, subject to regulatory approval and further customary closing conditions.

Still today, the debt issuance process carries a heavy operational burden due to time-consuming manual work and lack of automation, which in turn leads to significant duplicate workload across the processing chain. The initial focus of the partnership will be on Eurobonds with the aim to expand the offering to also cover other asset classes in the future.

Origin currently counts over 90 issuers and 20 dealers as clients, including some of the largest participants in the international capital markets. The company has developed three products that aim to automate the debt issuance process: their Marketplace, Documentation and Post-Trade modules. The capital raised in this Series A financing round will be used to explore the partners’ joint vision of creating an end-to-end, open access, straight-through digital process for issuance, settlement and listing of debt instruments. This aims to further integrate Origin’s products into the existing capital markets ecosystem.

Jens Hachmeister, Head of Issuer Services & New Digital Markets at Clearstream, said: “The lack of automation in bond issuance takes up a tremendous amount of resources and hampers issuers’ capacities to adopt more flexible funding strategies. We have been approached by clients in this regard to support them in further streamlining their workflows. In Origin, we have found an innovative and experienced partner to do just that.”

Raja Palaniappan, CEO and co-founder of Origin, said: “We are very excited and proud to have the confidence of Clearstream and LuxSE in this transaction. This step is a fantastic validation of not just our technology, but also of the impact we have already had on the market and most importantly our customers. We look forward to working together with our new partners to make debt issuance cheaper, faster, and better for all market participants.”

Arnaud Delestienne, Director of International Capital Markets at LuxSE, commented: “We welcome Clearstream’s investment in Origin, which we see as a testament to Origin’s tremendous potential when it comes to modernising and improving the entire bond issuance process. Clearstream and LuxSE are active in the listing and settlement of international debt securities, and through this initiative, we can accelerate the digitalisation efforts in primary capital markets.”

Source: Clearstream

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