IIMagazine.COM - Technology - Munis: Net-exempt no more -
[Cached Version]
Published on: 10/6/2000
Last Visited: 6/14/2001
MuniCenter CEO Thomas Vales and Wendt both say that the competition will be beneficial , improving the muni market's pricing mechanisms and overall efficiency.
...
Any attempt for greater transparency and broader distribution is a positive , says Vales.
But on the flip side , as is evident in the proliferation of alternative trading venues for equities , is the risk of fragmentation that dilutes liquidity.Already , there is talk of a convergence mirroring the consolidation of Wall Street firms themselves. ( Muni-Group supporters Goldman and Spear Leeds recently merged , and PaineWebber is combining with UBS. ).
...
The B2B commitment is just as strong at MuniCenter because , says Vales , there are too many regulatory issues involved in B2C , or business-to-consumer.More than 100 firms are actively trading on the site , and we're trying to establish relationships with every dealer out there , from the smallest to the largest firms..
MuniCenter's fourth founding equity partner , interdealer brokerage Chapdelaine & Co. , is supplying crucial client support in the form of 65 telephone brokers.
There are over 70 , 000 issuers of municipal bonds , explains Vales , 36 , a former Bankers Trust Corp. managing director of fixed-income arbitrage.And these are very complex securities.A lot of the bonds have stories that need to be told - the kinds of things you need human interaction for.That should be very helpful to the traders..
The heft of MuniGroup and MuniCenter isn't deterring others from jockeying for position - not even those groups' principals.Placing a slightly different bet , Goldman , Merrill and Morgan Stanley in June announced BondBook , an anonymous electronic marketplace for both corporates and munis , with a projected fourth-quarter start date.