FRANKFURT, Jan 6 (Reuters) - Deutsche Boerse hoped for quick redress after a Frankfurt court ordered a suspension of trading in corporate bonds over Boerse's Xetra electronic platform, the exchange operator said on Wednesday.
'We hope to get a court date within January (to deal with the suspension),' a Deutsche Boerse spokesman said.
The German stock and derivatives exchange operator was forced to halt electronic trading of around 700 corporate bonds covered by its 'continuous auction with specialists' model this week following a legal complaint by two securities dealers.
The two dealers launched their complaint after failing to win a place as bond trading specialists on the new system, which started on Dec. 1. Deutsche Boerse had been unable to reach an out-of-court settlement with them, it said.
The exchange operator has been pushing for changes to the system of trading through lead brokers, part of the worldwide trend toward cheaper electronic trading, but brokers are loath to see their lucrative commission margins trimmed.
The suspension affects around 250 market participants trading the bonds through the three brokers Boerse selected, from around Europe that are linked to Xetra, Deutsche Boerse said, adding that floor trading in the bonds is still possible.
The specialist model was meant to allow retail investors and small to medium-sized institutional investors to marry the cost benefits of electronic trading with the tradability and price quality of specialist brokers, even for small orders.
Trading volumes in the bonds totalled 6 million euros ($8.62 million) in December and Boerse plans to add other types of bonds to the service gradually.
Deutsche Boerse chose Close Brothers Seydler Bank AG, ICF Kursmakler AG and Wolfgang Steubing AG as specialist brokers for the service, out of nine candidates that applied, it said.
($1=.6963 Euro)
(Reporting by Anika Lehmann and Jonathan Gould; Editing by Sharon Lindores) Keywords: DEUTSCHEBOERSE/BONDS (Reuters Messaging: jonathan.gould.reuters.com@reuters.net; +49 69 7565 1242) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
'We hope to get a court date within January (to deal with the suspension),' a Deutsche Boerse spokesman said.
The German stock and derivatives exchange operator was forced to halt electronic trading of around 700 corporate bonds covered by its 'continuous auction with specialists' model this week following a legal complaint by two securities dealers.
The two dealers launched their complaint after failing to win a place as bond trading specialists on the new system, which started on Dec. 1. Deutsche Boerse had been unable to reach an out-of-court settlement with them, it said.
The exchange operator has been pushing for changes to the system of trading through lead brokers, part of the worldwide trend toward cheaper electronic trading, but brokers are loath to see their lucrative commission margins trimmed.
The suspension affects around 250 market participants trading the bonds through the three brokers Boerse selected, from around Europe that are linked to Xetra, Deutsche Boerse said, adding that floor trading in the bonds is still possible.
The specialist model was meant to allow retail investors and small to medium-sized institutional investors to marry the cost benefits of electronic trading with the tradability and price quality of specialist brokers, even for small orders.
Trading volumes in the bonds totalled 6 million euros ($8.62 million) in December and Boerse plans to add other types of bonds to the service gradually.
Deutsche Boerse chose Close Brothers Seydler Bank AG, ICF Kursmakler AG and Wolfgang Steubing AG as specialist brokers for the service, out of nine candidates that applied, it said.
($1=.6963 Euro)
(Reporting by Anika Lehmann and Jonathan Gould; Editing by Sharon Lindores) Keywords: DEUTSCHEBOERSE/BONDS (Reuters Messaging: jonathan.gould.reuters.com@reuters.net; +49 69 7565 1242) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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