Nasdaq Europe in German exchange alliance
GERMANY – The Berlin Stock Exchange (BSE) and NASDAQ Europe (NE) have announced details of a partnership to create a common trading platform, the first time an international stock exchange has formed a direct link with the German equities market.
The move is seen as an important step in NE’s strategy of forging alliances with major markets and puts it in a good position to be able to capture German order flow.
The deal involves both sides taking a ‘significant’ minority interest in each other’s shares. NE’s chief executive officer, Michael Sanderson, has joined the board of BSE, whilst BSE’s deputy chairman, Dr Jörg Franke has joined NE’s.
The first step of the agreement sees 200 of the most frequently traded stocks in Germany, both domestic and international - account for a majority of the country’s equity market, made available through NE.
The second phase will see NE’s ETS electronic trading system link up with Xontro, the shared technical routing system for all German regional exchanges.
The parties say there will be no need for any large scale investment in new IT systems and infrastructure, since the ETS module will be available through the existing Xontro infrastructure.
The deal also offers German investors access to NE under German regulation and at prices comparable to domestic trading.
Says Franke: “BSE has always been very international in its outlook. Most of our trading is focused on US and other foreign stocks. The partnership with NE allows us to benefit from the NASDAQ brand name and trading method.”
Sanderson adds : “Having launched our trading platform in June, we are proud to become the first non-domestic market to form a direct link with Germany’s equity markets.”