MARKIT, DTCC PARTNERSHIP TO LAUNCH MARKITSERV

Posted August 11, 2009

LONDON and NEW YORK – Markit and The Depository Trust & Clearing Corporation (DTCC) announced plans to launch MarkitSERV, a new company that will combine the two organizations’ electronic trade confirmation and workflow platforms. The unified offering will provide a single gateway for over-the-counter (OTC) derivative trade processing, as of September 1.

Jointly owned by DTCC and Markit, MarkitSERV will combine the DTCC Deriv/SERV and Markit Wire trade confirmation platforms to cover all major asset classes including credit, interest-rate, equity and commodity derivatives. It will connect multiple market participants and execution venues to downstream processing platforms such as DTCC’s Trade Information Warehouse for credit default swaps (CDS). It will also connect to various central counterparty platforms for interest-rate swaps and CDS, in collaboration with the DTCC Trade Information Warehouse.

“Our shared vision is to provide the industry with a more secure, reliable and streamlined operational environment for confirming OTC derivative transactions globally,” says Michael C. Bodson, Executive Managing Director of Business Management and Strategy at DTCC, and Chairman-designate of MarkitSERV. “Each of our firms has been independently successful, and this joint company will now leverage our combined expertise to extend benefits to a wider user base and across a more diverse range of financial instruments. This is certainly in keeping with DTCC’s desire to pursue partnering opportunities that reduce risk and serve the industry as a whole.”

Markit and DTCC first announced a strategic partnership in July 2008, subject to completion of due diligence, regulatory filings and approval by relevant global regulators. Due diligence is now complete and MarkitSERV has received regulatory approval from the UK Financial Services Authority and the US Department of Justice.

“We have had extensive discussions with buy-side firms over the past year, and the message we keep hearing is that they need a simplified processing solution that is accessible and efficient,” says Lance Uggla, Chief Executive Officer of Markit. “We believe MarkitSERV will address the industry’s infrastructure needs and help the OTC derivative markets transition to a new environment of reduced risk and improved operational efficiency.”

MarkitSERV will comprise the Markit and DTCC flagship securities trade processing services for affirmation, confirmation, novation, allocation and reconciliation. These include Markit Wire, Markit Trade Manager, Markit Tie-Outs and Markit PortRec in addition to the DTCC Deriv/SERV matching and confirmation engine, MCA Xpress and novation consent service.

“We will help market participants meet their commitments to regulators globally to reduce operational risk and adopt clearing for the OTC derivative markets,” says Jeff Gooch, Executive Vice President of Trade Processing and Portfolio Valuations at Markit, and Chief Executive Officer-designate of MarkitSERV.