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London, December 22, 2004 – The MTS Group continued
to see strong growth across its markets in 2004 with
overall volumes topping €17 trillion in the January
to November period, representing an increase of 9%
from the same period in 2003. Despite the difficult
trading conditions in European fixed income, MTS benefited
from the addition of new products and growth area markets,
including in the New EU States and in the dealer-to-client
space. In particular, volumes on BondVision, the B2C
arm of MTS, were up more than 90% on the addition of
new participants, new securities and new dealers.
Revenues for the MTS Group for the financial year
are projected at €60.4 million, with pre-tax profits
estimated at €5.3 million. The revenue level is
substantially flat in comparison to 2003 as the overall
cost of trading per million for cash, repo and BondVision
decreased by 10 euro cents to €1.34 (€1.44
in 2003). The cost reduction was possible due to higher
turnover and the growth of data sales.
In 2004, MTS continued its expansion into the New
EU States with the launch of MTS Poland in November
and the continued expansion of NewEuroMTS, a market
dedicated to trading the euro-denominated debt of the
states new to the EU. Average monthly volume on NewEuroMTS
was up 211% for the five-month period ending in November
versus the market’s initial six months.
In addition, MTS launched dedicated markets for quasi-government
bonds, benchmark linkers and Treasury bills in 2004
and announced plans for a January 2005 launch of an
electronic swaps market in partnership with ATFox.
The new swaps market will benefit from the wide distribution
of the MTS network, which connects more than 400 institutions
across Europe. Furthermore, the EuroMTS Index family
continued in its enlargement with the launch of indices
tracking the New EU States and the linkers market,
and with the creation of exchange-traded funds and
structured products tracking the indices. Over 200
billion of assets under management are now referenced
to the EuroMTS Indices. Yield performance levels of
the EuroMTS Index family provided positive returns,
as follows: Global EuroMTS Index Total Return with
7.63%; EuroMTS inflation-linked index with 11.51%;
and NewEuroMTS index with 10.48% (based on data from
January 2, 2004 to December 21, 2004).
Participation in MTS continued to grow as well. BondVision
saw a 19% increase in the number of dealers to 31,
while the number of clients rose by 35% from 2003.
The number of MTS market participants also grew by
2.5%, reflecting continued support of MTS’ objectives
of liquidity, efficiency and transparency. The MTS
Group connects more than 1080 participants across Europe
through its single network. In the coming year, MTS
anticipates continued growth via the launch of additional
markets along with enhancements to existing products
and markets. Because the marginal cost of creating
new MTS markets is small, participants can easily connect
to new markets or add new products.
Technology developments in 2004 have been significant
with the introduction of numerous value-added functionalities
and the possibility to access the MTS cash markets
via the Internet. Furthermore, all the major technology
contracts have been renegotiated paving the way for
the further evolution of the MTS technology software
and hardware architecture towards a modular, flexible
and cost-effective system with greatly enhanced functionality.
This will allow the Internet to be a secure and efficient
alternative means to access the MTS markets. The first
phase of the migration to the new hardware will be
the introduction of the new Money Market platform in
summer 2005.
Notes to Editors
- MTS Group
The MTS Group of companies collectively comprises Europe’s premier electronic
market in fixed-income securities with average transaction volumes of 85 billion
euros a day (single-counted). The MTS model utilizes a common trading platform,
although corporate governance and market supervision remain with the domestic
financial community. The MTS Group of companies include the following wholesale
markets: EuroMTS, EuroCredit MTS, NewEuroMTS, MTS Quasi-Government Market,
Eurobenchmark Treasury Bills Market, EuroMTS Linkers Market, MTS Amsterdam,
MTS Austrian Market, MTS Belgium, MTS Denmark, MTS Deutschland, MTS España,
MTS Finland, MTS France, MTS Greek Market, MTS Ireland, MTS Italy and MTS Portugal.
The Group also includes BondVision, the Internet-based multi-dealer-to-client
platform and MTSNext, the company that manages the EuroMTS Index, the first
real-time transparent and independent pan-European government bond index. Tradable
products on the Telematico markets comprise Austrian, Belgian, Czech, Danish,
Dutch, Finnish, French, German, Greek, Hungarian, Irish, Italian, Lithuanian,
Polish, Portuguese, Slovakian and Spanish government bonds, quasi government
bonds of EIB, KfW, Freddie Mac and CADES, Pfandbriefe, Obligations Foncières,
Cédulas Hipotecarias and UK covered bonds.
More information is available on www.mtsgroup.org
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