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Goldman to implement electronic bond trading platform – reports

FICC unit could modernise from only desk-based traders

Goldman Sachs, which has traditionally traded bonds with desk-based traders, is reportedly considering rolling out electronic trading systems for the products.

The investment bank's fixed income, currency and commodities unit (FICC) is keen to use more automated trading, according to the Financial Times.

Goldman Sachs has for many years used advanced electronic trading systems for the stock markets, but bond trading as an industry has lagged behind. It would be one of the first banks to introduce full electronic trading for bonds.

Rates and currencies were the most likely candidates for the changes, the newspaper reported, given the more advanced technology already in use.

Revenues at Goldman Sachs' FICC unit plummeted by a third to $9 billion last year, prompting some of the new plans, it is understood. But the bank is said to be evaluating the full impact of the new Dodd Frank rules being introduced in the US, before designing such a system.

"Goldman Sachs and others are waiting for the final Volcker and derivatives rule making under Dodd-Frank before they can redesign and begin implementing more electronic platforms," David Hendler, banking analyst at CreditSights, told the FT.

"Banks and brokers need to incorporate a greater use of computerisation and technology in fixed income, similar to what the equities segments had to deal with [more than 10] years ago."

The bank had not provided comment at the time of writing.


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