NEX Group

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NEX Group
Founded 2016
Headquarters London
Key People Michael Spencer, Chief Executive
Employees 1,600


NEX Group is the name given to the former ICAP when the company merged with Tullett Prebon and sold off its brokerage business to Tullett. The company owns several divisions that supply financial technology, regulatory reporting, investment in fintech firms, and pre-trade and post-trade processing and risk management for FX, exchange-traded derivatives, OTC products, credit default swaps and synthetic and cash equities. It owns a swap execution facility (SEF) that it launched in 2013.

The ICAP-Tullet merger gave the ICAP brand to the brokerage business now owned by Tullet and rebranded the rest of ICAP as NEX Group. The renaming completed the company's shift from voice broking to specializing in electronic markets and post-trade services.[1]

Before the name change, ICAP had already lowered the number of telephone brokers it employed by 8.6 percent from the previous year.

The new Tullet-owned brokerage business was named TP ICAP.

NEX Group incorporates a number of entities into its business, some of which were previously acquired by ICAP. Those include:

  • Abide Financial, a global regulatory reporting specialist that ICAP acquired in October 2016
  • EBS BrokerTec, NEX's electronic foreign exchange (FX) and fixed income business.
  • ENSO, a financial technology company NEX acquired in early 2017
  • Euclid Opportunities, NEX Group’s financial technology investment business
  • NEX Data
  • NEX Exchange
  • Reset
  • Traiana, a market infrastructure technology firm for cross-asset, pre-trade and post-trade processing and risk management for FX, exchange-traded derivatives, OTC products, credit default swaps and synthetic and cash equities.
  • TriOptima, a technology company providing OTC derivatives post trade risk management and infrastructure services such as portfolio compression and portfolio reconciliation for OTC derivatives market participants.

History

NEX Group's predecessor, ICAP, was formed in September 1999 by the merger of Garban plc and Intercapital plc into Garban-Intercapital plc. The Garban-Intercapital merger brought together Garban's government and corporate bonds, interest rate products and money market instruments with Intercapital's interest rate swaps and options, commodity swaps, illiquid securities and foreign exchange options. Garban-Intercapital plc was changed to ICAP plc in July 2001.

ICAP took a significant step in growing its business in Oct. 2007 when it purchased Traiana, a post-trade network for FX, exchange-traded derivatives, equities and equity derivatives in a transaction valued at $247 million. ICAP sold a 12 percent stake in Traiana in January 2013 to a group of seven of its largest customers: Bank of America Merrill Lynch, Barclays, Citi, Deutsche Bank, JPMorgan, Nomura and Royal Bank of Scotland.[2]

On February 15, 2013, ICAP launched its electronic interest rate derivative platform in the US for trading of US Dollar (USD) interest rate swaps. On June 3, 2013, ICAP began trading in Sterling (GBP) interest rate swaps on its electronic interest rate derivative platform.

After eliminating about 400 jobs at its broking unit in 2014 to cut costs and then pulling out of the Wholesale Markets Brokers Association Americas in 2015, ICAP eventually sold its brokerage unit to Tullett Prebon in 2016, keeping the remaining part of the business as NEX Group.[3] [4]

For more, see "History" on the ICAP MarketsWiki page.

Products and Services

NEX Group provides electronic platforms and tools for the professional trading community.[5]

NEX has four business lines:

  • NEX Markets supplies the electronic execution platforms. (EBS BrokerTec is part of NEX Markets.)
  • NEX Optimisation offers a portfolio of cloud hosted services across the transaction lifecycle. It encompasses Abide Financial, ENSO, NEX Data, Reset, TriOptima and Traiana, as well as NEX Regulation Reporting Platform, launched in March of 2017, powered by Abide Financial.[6]
  • NEX Opportunities (Euclid Opportunities), is a venture capital fund that invests in fintech startups. Euclid Opportunities investments include: Abide Financial, ENSO Financial, OpenFin, Duco, OpenGamma, and RSRCHXchange.[7]
  • NEX Exchange works with issuers, investors, advisers and brokers to provide a platform for equity and bonds.

Technology

NEX Group chose Nasdaq's Smarts market surveillance technology to provide the technology to monitor its FX and fixed income trading venue EBS BrokerTec for fraud and market abuse.[8]

Key People

References

  1. ICAP to Become NEX Group to Start Life After Voice Broking. Bloomberg.
  2. ICAP sells stake in Traiana. FT.com.
  3. ICAP CEO Says Firm Cut 400 Jobs in Broker Unit to Save Costs. Bloomberg.
  4. The Incredible Shrinking WMBAA: ICAP’s Departure from Industry Association a Sign of the Times. John Lothian News.
  5. Markets. NEX.
  6. NEX Launches New Regulation Reporting Platform. Traders.
  7. NEX Invests in Research Innovator. Markets Media.
  8. Nasdaq to help NEX spot fraud and market abuse. Financial News.