New York – Yesterday Markit, a global financial information services company, announced the launch of a commission management platform that will allow buy-side firms to manage and allocate commission credits through a single institution. The initiative, which has the backing of a number of heavy-weight sell-side firms, intends to reduce the administrative burden of accessing numerous broker-specific platforms.
The idea of a consolidated commission management tool has been in the works for years. In 2008 a group of investment banks began exploring the concept of consolidated commission management tools, to provide competition to Westminster Research Associates, part of ConvergEx Group. In March of 2009, we reported that Cogent Consulting, a provider of software solutions for financial institutions’ commission management was negotiating with a broker consortium to be acquired for the aggregation platform. Even though a non-binding letter of intent was signed in May 2009, only one month later we reported that Cogent had ended the negotiations due to a failure to agree on the final terms of the deal. Later that year, Cogent was acquired by ConvergEx.
The interest in the buy-side for an aggregation platform for commission management continued to grow. In our commission management survey conducted in 2008, 39% of buy side respondents supported the idea of an aggregation platform, while in 2009 65% did.
Markit’s platform has the backing of 8 sell side partners: Bank of America Merrill Lynch, Barclays Capital, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, and Morgan Stanley. While not a partner, UBS will be a sell-side client of the platform.
The Markit Commission Manager will enable users to reconcile their trading commissions with multiple counterparties and instruct them to pay for research and brokerage services from the Markit platform. Cogent offers similar capabilities, and, for now, the brokers supporting Markit are also available on Cogent’s platform. Markit plans to compete based on its technology infrastructure, usability and support.
Sofia Rossato, Head of Markit Research Manager at Markit, said: “Markit Commission Manager is the latest addition to our Markit Research Manager range of services. Our objective is to enable investment firms to manage their entire research workflow – including sourcing research, tracking corporate access, voting on brokers and managing research commissions – from one single platform to bring greater efficiency and internal visibility to the whole process. Markit Commission Manager is the final piece in the jigsaw.”
The full text of Markit’s press release follows:
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Press Release – 04 October 2011
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| Markit Launches Commission Management Platform |
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| London and New York, NY – Markit, a leading, global financial information services company, today announced the launch of Markit Commission Manager. The service helps buy-side firms manage and allocate commission credits efficiently while addressing the concerns associated with maintaining such credits with a single institution.
Markit is introducing this new service as increasing numbers of buy-side firms demand virtual aggregation of commission credits. Buy-side institutions are looking for a single platform to manage their credits in order to reduce the significant administrative burden associated with accessing numerous broker-specific platforms. Markit Commission Manager will ease that burden by enabling users to reconcile their trading commissions with multiple counterparties and then instruct those counterparties to pay for research and brokerage services – all from a single platform.
Sofia Rossato, Head of Markit Research Manager at Markit, said: “Markit Commission Manager is the latest addition to our Markit Research Manager range of services. Our objective is to enable investment firms to manage their entire research workflow – including sourcing research, tracking corporate access, voting on brokers and managing research commissions – from one single platform to bring greater efficiency and internal visibility to the whole process. Markit Commission Manager is the final piece in the jigsaw. We have partnered closely with BofA Merrill Lynch, Barclays Capital, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, J.P. Morgan and Morgan Stanley to ensure the platform meets the needs of the industry.”
UBS will also be a sell-side client of the platform. Markit Commission Manager will be available to the buy-side and sell-side, and will enable the buy-side to maintain credits with their broker-dealers and use these credits to pay for third party services.
Frank Volino, Head of Global Commission Management Services at Citi, said: “This platform is good news for buy-side and sell-side alike. It will allow the buy-side to use a standardised set of tools to manage their commission credits at multiple broker-dealers. We are very pleased to be part of this important industry initiative. Markit’s leading technology, coupled with their independence, places this platform in a strong position to become the industry standard.”
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| For More Information, Please Contact |
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Caroline Lumley
Director, Corporate Communications
Markit
Telephone: +44 20 7260 2047
Email: Caroline.Lumley@markit.com |
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| About Markit |
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| Markit is a leading, global financial information services company with over 2,300 employees. The company provides independent data, valuations and trade processing across all asset classes in order to enhance transparency, reduce risk and improve operational efficiency. Its client base includes the most significant institutional participants in the financial marketplace. |
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