The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Johannesburg Stock Exchange Selects Cinnober to Support Strategy for Growth

The Johannesburg Stock Exchange’s (JSE) partnership with Cinnober to develop a multi-asset clearing platform is expected to deliver not only real-time clearing, but also overall trading improvements and greater market certainty.

The contract between Cinnober and the JSE to build a real-time integrated clearing platform initially handling six asset classes was signed last week. Implementation of a customised version of Cinnober’s TRADExpress RealTime Clearing system by the partners is due to start soon, with delivery of the platform to the exchange in the first quarter of 2015 and the exchange then deciding when to go live. The platform will replace a number of clearing systems covering different asset classes, some of which have been built in-house and others sourced from local partners.

Riaan van Wamelen, chief information officer at the JSE, says: “Modern clearing requirements and the evolving regulatory landscape result in significant technology demands for exchanges worldwide. The project we are embarking on seeks to process all asset classes from all markets on a single integrated solution and will enable our strategy for growth.”

While this is a major project for the JSE, it is a first win for Cinnober at the exchange, which uses the London Stock Exchange’s Millennium Exchange technology to power some of its equity trading systems. Other trading platforms, like the exchange’s clearing systems, are in-house built or provided by local suppliers, begging the question of whether a successful implementation of the Cinnober clearing platform could open the door for the company to provide an integrated trading platform.

Meantime, the implementation of the clearing platform is expected to lead to some trading improvements. Cinnober CEO Veronica Augustsson explains: “The platform will provide JSE clearing and trading members with a real-time view of risk, while the integrated clearing of asset classes will provide a view of net risk, which means clearing firms shouldn’t have to post unnecessary collateral. There is lots of value for clearing firms to pass on to trading customers and overall trading should improve as a result of real-time clearing, making the market more certain. For example, if an algorithm being used in high frequency trading goes wrong, it is possible to see in real time positions that require more than there is coverage for. This is good for the market and helps to build confidence.”

Cinnober is conducting implementation and integration projects similar to the JSE project at LME Clear and BM&FBovespa, and says there are more to come as organisations realise the need for integrated clearing platforms to reduce high, and sometimes prohibitive, costs of collateral.

Related content

WEBINAR

Recorded Webinar: How to get data lineage right

Don’t miss this opportunity to view the recording of this recently held webinar. Data lineage is key to regulatory compliance and financial institutions’ ability to understand and use their data to business advantage. It is also important from an operational perspective, as a successful implementation can identify systems and data feeds that are no longer...

BLOG

Capital Group Joins Plato Partnership

Investment manager Capital Group has joined Plato Partnership, the not-for-profit with a focus on equity market structure and operations, as a founding buy-side member. The firm joins Plato’s ranks of buy-side members including Axa Investment Managers, Baillie Gifford, BlackRock, Fidelity International, Norges Bank Investment Management, Union Investment, Liontrust, Legal & General Investment Management, Janus Henderson,...

EVENT

RegTech Summit New York City

Now in its 5th year, the RegTech Summit in NYC explores how the North American financial services industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

Regulation and Risk as Data Management Drivers

A-Team Group recently held a webinar on the topic of Regulation and Risk as Data Management Drivers. Fill in the form to get immediate access to the accompanying Special Report. Alongside death and taxes, perhaps the only other certainty in life is that regulation of the financial markets will increase in future years. How do...