Intercontinental Exchange's TMC fixed-income trading platform has gained approval in Canada, allowing the country access to ICE's full suite of execution protocols for markets.
ICE has been working on getting approval to operate ICE TMC in Canada for around a year, driven mostly by customer demand, said Peter Borstelmann, president of ICE Bonds.
"We heard that loud and clear, and then we worked to get the necessary approvals from the Canadian provinces," he said. "Now that we've received the necessary approvals, our team will now focus on onboarding and integrating Canadian-based entities that wish to access our network and the municipal bond liquidity available on our platforms."
ICE TMC, part of ICE Bonds, provides market participants access to an all-to-all market for trading munis and other bonds.
"ICE's municipal bond offering brings together ICE's Continuous Evaluated Pricing for munis, pre-trade analytics and access to the full breadth of ICE's municipal bond market liquidity," a press release said. This includes both of its alternative trading systems ICE TMC and ICE BondPoint, the latter of which received approval to operate in Canada on June 2020.
"Our ability to extend access to our ICE TMC platform to Canadian-based accounts allows us to further strengthen and broaden our network. There is a strong desire and interest in trading municipal bonds given the current rate environment and the breadth of the muni-verse," Borstelmann said. "All participants of our network will benefit as a result of having exposure to a larger set of entities to provide or request liquidity from."
He said ICE has spent the past few years consolidating it broker-dealers after the acquisition of both Bondpoint and TMC,
ICE agreed to buy TMC Bonds in May 2018. TMC Bonds integrated its electronic fixed income market with ICE's fixed income trading and data business, offering clients access to improved workflow capabilities.
"We've been improving on the technology and expanding the network here in the United States," he said. "We continue to see interest in accessing our network from participants in other regions as well and are taking the necessary steps, whether it be from a regulatory or technology perspective, to ensure our platforms conform to the customer's local regulatory framework."
Currently, ICE Bonds is only approved to operate in the U.K. and Switzerland. For other regions, the firm has to get local approval or work to get access from the EU.
Demands and further interest from other regions have prompted ICE to look into further expanding in Europe, but he noted there are more complexities.
The expansion into Canada is just the beginning, he said.
"We continue to work with new market participants to gain access to our network given our [alternative trading systems] — ICE BondPoint and ICE TMC — both represent over 60% of muni electronic trading in the United States," he said. "Enabling them with access will provide them with exposure to our broad and deep Muni liquidity pools to efficiently and effectively manage their trading needs."
