The Bombay Stock Exchange on Friday signed an agreement with OMX, a Sweden-based exchange technology provider, for trading and clearing systems to strengthen its derivatives and securities trading capabilities.
Under the agreement, the BSE will implement the systems from OMX, which will serve as its new trading and clearing platform for derivatives trading and cash securities.
The first phase of the system will be rolled out before mid-2008. The launch of BSE's new trading platform is part of its strategy to enhance the volume, speed up transactions and bring more liquidity, said Rajnikant Patel, Managing Director & CEO of BSE.
The new technology is also expected to offer a more robust derivatives platform for the Indian market from the BSE. Currently, trading in the equity derivatives market is monopolised by the rival National Stock Exchange.
"OMX has demonstrated a strong commitment to delivering a platform that, we are confident, will provide an enriching experience to the market intermediaries and investors in doing business with BSE," said Patel.
OMX will replace CMC, which has been the technology provider for the BSE for several years now, said officials. OMX CEO Magnus Böcker said through transforming its trading and clearing infrastructure, the BSE would be able to meet the escalating volume capacity needs.
The new clearing system will allow the BSE to offer a wide range of products as well as to offer a new set of clearing services to its members.
In addition to the technology implementation, the agreement encompasses a business partnership with the joint objective to drive and grow business at the BSE.
Also involved in the project are a sub-contractor Headstrong and HCL Technologies.
"The trading platform is part of BSE's ongoing efforts to transform its exchange IT infrastructure to match the growing needs of the marketplace. The first phase of the system roll-out is targeted for launch by mid-2008," said Patel.
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