Euroclear Bank is transferring all existing and future distribution and commercialisation of its Eurobond reference data to Markit, leaving the bank to focus on core business around settlement and clearing, and giving the financial information services provider rights to distribute reference data covering more than 200,000 Eurobonds. The strategic agreement covers a broader set of Eurobond reference data than the Xtrakter data that Markit currently receives from Euroclear under a standard vendor licensing arrangement and that Euroclear will continue to offer on a standard vendor-licensing basis.
As part of the strategic deal, Euroclear will continue to provide its clients with direct access to the Eurobond reference data that Markit will distribute. Markit is expected to review its licence covering the Xtrakter data feed, which is dedicated to the wholesale market segment that is particularly interested in prices and volumes, once it has integrated the more comprehensive portfolio of Eurobond reference data covered by the distribution agreement into its reference data service and made the data available to market participants late this year.
As part of the Euroclear integration, Markit will optimise the data by cross-referencing it to its own entity and industry sector identifiers, making it easier for customers to consume.
Euroclear initially considered providing the Eurobond reference data to Markit as part of Xtrakter, but having looked at other options decided on a direct strategic distribution agreement with Markit. Euroclear says Markit’s network, customer relationships, product range and track-record in packaging and distributing reference data are the best fit for the Eurobond data the bank has available and is willing to share with international capital markets.
Ed Chidsey, managing director and head of global data services at Markit, says: “The Euroclear content is a robust data set that covers the vast majority of Eurobonds. To the extent that we require additional European Eurobond content, we will consider other strategic relationships to fill any gaps.”
Markit will offer the Euroclear reference data as a regional package in Europe and as part of its global bond reference data service, adding data on over 200,000 Eurobonds to its global universe of about one million bonds.
“We are building out our reference data capabilities in support of our evaluated bond pricing service that we introduced a couple of years ago,” says Chidsey. “We needed broad reference data that would have been difficult to source from competitive data vendors, so we decided to be self sufficient. Across our multi-asset class reference data offering we are always looking at strategic licence deals in Europe and other jurisdictions, but we want to create a balance between self-sourced data and rights arrangements with other suppliers.”