Yieldbroker is a co-operative venture between leading debt market participants. It was established to provide the systems infrastructure, regulatory framework and compliance oversight necessary to facilitate the growth of orderly electronic marketplaces in Australian and New Zealand debt securities and derivatives.

Yieldbroker currently operates two licensed markets: a dealer-to-client trading platform and a dealer-to-dealer trading platform.

Yieldbroker is a co-operative venture with ownership shared equally between leading banking participants in the Australian and New Zealand debt markets. The current shareholder banks are ABN-Amro, Citi, Deutsche Bank, JP Morgan, Macquarie Bank, RBC and UBS.

Four further banks – ANZ, CBA, Toronto Dominion and Westpac – also participate in Yieldbroker as price providers in the dealer-to-client market.

Yieldbroker was established to provide the systems infrastructure, regulatory framework and compliance oversight necessary to facilitate the growth of orderly electronic marketplaces in Australian and New Zealand debt securities and derivatives.

As a shared initiative, Yieldbroker goals are determined in consultation with leading market participants and are focused on generating broad benefits for all debt market users. Yieldbroker’s principle objectives are to:

• Develop accessible dealer-to-client trading platforms that foster liquidity, enhance price transparency and provide clients with efficient deal execution in Australian and New Zealand debt securities and derivatives.
• Establish co-operatively owned, low cost dealer-to-dealer platforms across a broad range of debt securities and derivatives to reduce bank transactional costs.
• Encourage straight-through-processing solutions that improve transactional efficiency and reduce operational and compliance costs.

Yieldbroker currently operates two markets, a dealer-to-client market and a dealer-to-dealer market. Secondary market trading is now accompanied by primary market auction/tender functionality.

Yieldbroker is a co-operative venture between leading banking participants in Australian debt markets and a joint goal of our participant banks is to reduce transactional costs by establishing co-operatively owned, low cost dealer-to-dealer platforms across a broad range of debt securities and derivatives.

The dealer-to-client market is a service provided to Yieldbroker’s thirteen participant banks and their institutional clients in the Australian and New Zealand debt markets. Asian-based investors are also able to access the Yieldbroker dealer panel via the Reuters RTFI trading platform.

The dealer-to-dealer market is accessible at minimal cost to all banks that are active in the Australian and New Zealand debt markets with 17 banks currently utilising the service.

Institutional clients of participating banks in the Australian and New Zealand debt markets. Participants must be professional investors. Yieldbroker does not operate a service for retail clients.

Asian-based investors are also able to access the Yieldbroker dealer panel via the Reuters RTFI trading platform.

The dealer-to-dealer market is accessible at minimal cost to all banks that are active in the Australian and New Zealand debt markets with 17 banks currently utilising the service.

Overseas based clients who operate a local office and hold an AFSL (Australian Financial Services Liscence) are able to access Yieldbroker directly. Asian-based clients are able to access the Yieldbroker dealer panel via the Reuters RTFI trading platform and should contact Reuters for more information on availability.

Yes. Some banks participate in Yieldbroker as clients in the dealer-to-client market.

By contacting Yieldbroker directly or through your sales representative at any of the Yieldbroker participant banks.

Security classes currently traded on Yieldbroker include:

• Australian and New Zealand government securities
• Australian Semi Government securities
• AUD denominated fixed rate corporate securities
• AUD denominated Floating Rate Notes
• AUD denominated Supranational, Sovereign, Agency fixed rate securities
• AUD denominated Treasury Notes
• AUD denominated Government Guaranteed bonds

Yiledbroker is currently developing client trading platforms for inflation-linked securities, and swaps with further debt security and derivative classes to be added over time.

Yieldbroker trades in a broad range of AUD denominated debt securities and NZ government securities.

Currently no, although a swaps trading platform is under development in the dealer-to-dealer market and it is expected that this will eventually become operational in the dealer-to-client market.

There are currently thirteen banks that provide prices to clients in the dealer-to-client market, ABN-AMRO, ANZ, CBA, Citi, Deutsche Bank, JP Morgan, Macquarie Bank, RBC, The Toronto Dominion Bank, UBS and Westpac.

Currently, all transactions on the dealer-to-client platform occur on a request for quote (RFQ) basis. This allows clients to send simultaneous enquiries and receive executable two way markets from all thirteen price making banks.

Yieldbroker also supports “live”, tradable pricing in the dealer-to-dealer market and this may be enabled in the dealer-to-client market in the future.

Clients can simultaneously receive executable two-way markets from all thirteen pricemaking banks.

Dealer and client response times vary depending upon the complexity of the transaction and the security type and may also vary over time dependent on market conditions. A matrix outling the various response times is included in the online help system.

Market “Axes” identify participant banks indicative interest in individual issues. Axes are identified by an icon next to the relevant security and trading clients can view axe details by clicking the icon or the security.

The functionality is only available in less liquid security classes with “Axes” currently listed in AUD denominated fixed rate corporate securities, AUD Supranational, Sovereign, Agency debt securities, Government Guaranteed ADI bonds and FRNs.

Yieldbroker was the first fixed income trading platform to be awarded an Australian Market Licence, which authorises Yieldbroker to operate two markets, a dealer-to-client market and an Interdealer (dealer-to-dealer) market.

All organisations that wish to participate in the Yieldbroker dealer-to-client market are required to sign a Client Participation Deed. This is a legal agreement that permits and governs access to the trading platform as a client.

The operating rules govern the rights and responsibilities of all market participants including the way in which the trading platform is to be used.

These rules are varied occasionally following consultation with Yieldbroker’s Dealer participants and subject to the approval of the Minister (as advised by ASIC).

No. While there have been considerable recent discussion about the benefits of launching a bond exchange, at this time the banking participants of Yieldbroker do not believe it would be a viable proposition.

Yieldbroker has a co-operative relationship with Reuters with both organisations seeking to aid each other for the benefit of our clients. The two key areas of co-operation are in the provision of Yieldbroker price data to users of Reuters and in allowing Asian based clients to access the Yieldbroker dealer panel via the Reuters RTFI dealing platform.

Our pricing algorithm continually aggregates price data from the thirteen Yieldbroker dealers, removing inconsistent observations and individual bias to produce a single realistic estimate of where the leading market participants are valuing a comprehensive range of debt securities.

Real-time indicative prices are available in over 700 securities, with markets covered including Australian and New Zealand government and semi-government debt, AUD denominated fixed rate corporate securities, AUD Supranational, Sovereign, Agency debt securities, Government guaranteed bonds and Floating rate notes. Further security classes, including inflation linked securities, swaps and credit default swaps are being added in coming months.

Yieldbroker real-time price data can be accessed by front-office, back-office, accounting and compliance staff at all trading platform users through the Yieldbroker DEBTS application.

End-of-day valuation sheets are also emailed daily and are available upon request from the Yieldbroker helpdesk.

Yieldbroker price data can also be accessed through a number of third-party vendors: Reuters, Standard and Poors, Interactive Data and DataScope.

Yieldbroker is actively working towards STP solutions with its clients, with a key organisational objective being improved transactional efficiency and the mitigation of operational and compliance risk for all debt market participants.

Yieldbroker and Omgeo have have established an interface between their services to facilitate streamlined fixed income processing.

Access to the Yieldbroker DEBTS platform is free to all back office, accounting and compliance staff of trading site users and some of the services currently offered by Yieldbroker are:

• Clients can utilise our API and FIX messaging to link in-house pre-trade or post-trade infrastructure to the DEBTS application
• The Yieldbroker DEBTS trading platform can be seamlessly linked with a number of OMS platforms (eg. Charles River, Blackrock Aladdin) allowing clients to upload trade details and allocations, execute trades then retrieve ticket and settlement details.
• Our allocation functionality provides the ability to attach allocation details to transactions to allow individual trade tickets to be issued for each account.
• The ability to receive immediate price confirmation on all trades
• Yieldbroker and Omgeo have established an interface between their services to facilitate streamlined fixed income processing.

Yieldbroker DEBTS (Direct Electronic Bond Trading System) is the trading platform developed by Yieldbroker to service the dealer-to-client and dealer-to-dealer markets.

Clients can utilise our API and FIX messaging to link in-house pre-trade or post-trade infrastructure to the DEBTS application The DEBTS trading platform can also be seamlessly linked with a number of OMS platforms (eg. Charles River, Blackrock Aladdin) allowing clients to upload trade details and allocations, execute trades then retrieve ticket and settlement details.

Yiledbroker has establised systems links to both Charles River and Blackrock Solutions Aladdin. The interfaces allow users of the either Investment/Order Management System to upload deal information and execute trades through the Yieldbroker DEBTS trading platform, providing institutional portfolio managers with convenient access to pricing and order execution.

The FIX-based interfaces also provides clients with the ability to retrieve transaction details enabling the automation of post-trade data processing, settlement and compliance procedures.

Yieldbroker DEBTS trading platform is a comprehensive dealing solution that supports both the dealer-to-client and dealer-to-dealer markets. The .NET based dealing application is designed to occupy minimal screen real estate and has been developed by Yieldbroker with an emphasis on two key operational objectives;

1. Adaptability

   DEBTS underlying flexibility enables continual innovation and improvement to allow the platform to be customised to meet the evolving requirements of market participants. Yieldbroker’s continuous interaction with clients coupled with the ability to regularly upgrade the DEBTS application allows:

   • ongoing adjustments to dealing procedures
   • the refinement of existing features and the regular addition of new services
   • the modification of the platform to permit trading in a broader range of debt securities and debt derivatives

2. Inter-operability

   The systems enhanced inter-operability gives DEBTS the ability to seamlessly connect with the existing systems of both banks and institutional investors. This connectivity provides the potential for:

   • integration with front office trading/risk management and OMS systems (eg. Charles River, Bond Edge, Aladdin)
   • interaction with back office and settlement systems and the ability to pursue straight-through-processing solutions
   • linkages to international trading platforms allowing overseas based clients to access Yieldbroker’s existing domestic marketplaces

Yieldbroker DEBTS can be downloaded from the Yieldbroker website to your local PC which must have the following minimum requirements:

• Windows NT4, 2000, XP Vista or Windows 7
• Microsoft .NET Framework version 1.1 (available free from Windows Update). Other framework versions may be installed but version 1.1 is mandatory.
• Microsoft Excel 97 or above

See installation for more information.

The Yieldbroker DEBTS trading platform is a desktop application that can be accessed via the public internet, or through the private networks operated by BT/Radianz or Macquarie Telecom.