ATG, Risk Office to Build Clearinghouse in Brazil

The new clearinghouse will be located in Rio

Americas Trading Group (ATG), a liquidity center and provider of exchange technologies in Latin American markets, says it has partnered with Brazil-based Risk Office to build out clearing functions ahead of its 2014 launch of ATS Brasil.

ATS Brasil, a new exchange-like equities matching platform initially announced in November 2012 by ATG and partner NYSE Euronext, will be the first to compete with the BM&FBovespa, the exchange operator that, to date, is solely authorized to handle lit equities trading in the country. The venture with Risk Office will provide a full range of clearing and settlement services in support of the new venue, which applied for authorization from Brazil's Securities and Exchange Commission (CVM) last June.

The clearinghouse will be governed separately and operationally segregated from ATS Brasil itself, and based in Rio de Janeiro. The two partners are currently in advanced negotiations with a third potential investor in the operation, and a CEO is expected to be named soon.

"The objective of ATS Brasil is to develop a new trading platform for Brazilian equities, stimulating the industry's growth and facilitating investors' access to global opportunities. The creation of a new stock exchange will increase competition in the domestic market, currently highly concentrated, and seeks to affect a positive impact on issuers, sellers, and buyers in Brazil," says Arthur Pinheiro Machado, ATG's COO.

A future foray into Brazil was also recently noted by Direct Edge CEO William O'Brien as one impetus for that exchange's merger with Bats.

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