A group of global financial institutions have announced the creation of DirectBooks, a technology platform designed to streamline connectivity within the primary market.
The financial institutions partnering to develop this platform include Bank of America, Barclays, BNP Paribas, Citi, Deutsche Bank, Goldman Sachs, J.P. Morgan, Morgan Stanley, and Wells Fargo.
Addressing inefficiencies in the marketplace across multiple communication channels, DirectBooks is designed to simplify the primary issuance process through the use of structured data and streamlined communications. The service should increase the efficiency and accuracy of deal workflow information among market participants by disseminating it through a communication platform that can be integrated into underwriter and investor systems to better connect underwriters and their clients. DirectBooks expects to scale globally for primary market offerings.
Richard D. Kerschner has been named as the chief executive officer of Primary Markets, the holding company for DirectBooks. A former NYMEX, CLS and ICAP/NEX Group executive, Kerschner has over 25 years of strategic and operating experience across technology platforms and capital markets. He also has experience as an active fintech investor and board member.
DirectBooks expects to cooperate with OMS providers and members of the buy-side technology ecosystem to ensure optimal service for all market participants. BlackRock and the Aladdin platform have already engaged with the company in the development of an enhanced integrated issuance process to bring efficiencies and standardisation for buy-side participants.
Every single one of the founding banks had an opinion on this news, as you can see below:
“As an industry-led platform, DirectBooks will offer a centralised hub for communication around primary market transactions and greatly improve the efficiency of the new issue process”, said Andrew Karp, head of Global Investment Grade Capital Markets at Bank of America (BofA Securities).
“DirectBooks will help drive increased collaboration on a global scale, and has the ability to deliver efficiencies and benefits to all participants in the primary issuance market," said Anne Daley, Investment Grade Syndicate at Barclays. "While DirectBooks will initially focus on Investment Grade transactions, its functionality should make it a platform of choice for other asset classes in the future.”
“This initiative represents an important step towards eliminating manual tasks, digitalising interactions with investors and making the new issue process significantly more efficient,” said Fred Zorzi, global head of Primary Markets, BNP Paribas.
“DirectBooks represents a collaborative, non-exclusive effort by the consortium to alleviate the pain points and inefficiencies in the primary market process felt by both underwriters and investors,” said Peter Aherne, Citi head of North American Investment Grade Capital Markets, Syndicate, and Capital Strategy & Structuring.
“The platform is a great opportunity to systematically and efficiently deliver our capabilities to our clients," commented Henrik Johnsson, co-head of Investment Bank EMEA at Deutsche Bank. "We keep governance over the data being generated and the ability to share announcements becomes more transparent resulting in faster communications between market participants. Adding in digitised data makes this the best way to optimise the new issue business.”
“Communication protocols in the new issue process have remained largely untouched for decades across asset classes," noted Jonathan Fine, head of Goldman Sachs’ Investment Grade Syndicate in the Americas. "DirectBooks has the capacity to profoundly alter the way in which underwriters and investing clients engage with one another - with substantial benefits on tap for all participants.”
“We are focused on delivering an efficiency tool that not only offers clients a better execution model than we have today, but is centred on standardisation, security, and data protection," added Bob LoBue, global head of Fixed Income Syndicate at J.P. Morgan. "We are excited to engage with the broader investor and dealer community on this platform.”
“DirectBooks is an example of the underwriter community’s commitment to providing our collective client base a responsive service,” said Paul Spivack, Morgan Stanley global head of Fixed Income Syndicate and co-head of Fixed Income Capital Markets, Americas.
“DirectBooks streamlines the new issuance process by bridging a communications gap between underwriters and investors, allowing for more transparency and improved deal execution,” said John Hines, global head of High Grade Debt Syndicate for Wells Fargo Corporate & Investment Banking.
“The creation of DirectBooks is an opportunity to re-engineer the way primary markets function by leveraging technology to improve connectivity, efficiency and accuracy,” concluded Kamya Somasundaram, head of Americas Credit Capital Markets at BlackRock. “We are lending our expertise as an investor in the primary market as well as a leading provider of order management systems, investment technology and risk analytics, via the Aladdin platform, to enhance the function of the markets for all investors.”
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