Saturday 31 May 2008
Trace Financial
Trace Financial provides products and services to support the business operations of brokers, market makers, fund managers, banks and other financial institutions. Products include systems integration technologies and generic intelligent interfacing hub systems. In addition Trace Financial provides corporate actions management solutions for a range of customers in the financial community.
OMX Securities And Brooks Macdonald
OMX Securities, a leading supplier of outsourced clearing and settlement services, today announced that Brooks Macdonald Asset Management is leveraging its existing clearing and settlement agreement with OMX to support significant growth in its discretionary management business.
Brooks Macdonald Asset Management is a subsidiary of specialist wealth management company Brooks Macdonald Group and has £1.0524bn funds under management (as at 31st December 2007). OMX Securities provides Brooks Macdonald with outsourced clearing and settlement services in UK, Foreign and European equities and funds.
When Brooks Macdonald needed to take on new business it turned to OMX Securities to achieve a rapid scaling up of its outsourced clearing and settlement operation in order to handle the increased volume of discretionary management business. OMX Securities successfully met mission critical timeframes, supporting Brooks Macdonald in achieving its sales and growth targets.
Chris Macdonald, CEO of Brooks Macdonald said: "OMX Securities helped us, quickly and efficiently, to meet the need to grow our business and have proved they are the right partner to support the continued expansion of our operation. The scalability of their clearing and settlement service will enable us to take additional new business well within our planned timeframes."
Angus Macdonald, CEO of OMX Securities comments: "OMX Securities is delighted to continue to support Brooks Macdonald to achieve its planned business growth. This project clearly signals that OMX Securities is well placed to provide wealth management firms with a flexible, responsive and professional clearing and settlement service."
OMX Securities has a proven track record in providing managed services to some of the UK's leading financial institutions. It supplies a complete business infrastructure to handle portfolio management, order management, execution, clearing, custody administration and settlement for wealth managers, institutional brokers and retail brokers.
Brooks Macdonald Asset Management is a subsidiary of specialist wealth management company Brooks Macdonald Group and has £1.0524bn funds under management (as at 31st December 2007). OMX Securities provides Brooks Macdonald with outsourced clearing and settlement services in UK, Foreign and European equities and funds.
When Brooks Macdonald needed to take on new business it turned to OMX Securities to achieve a rapid scaling up of its outsourced clearing and settlement operation in order to handle the increased volume of discretionary management business. OMX Securities successfully met mission critical timeframes, supporting Brooks Macdonald in achieving its sales and growth targets.
Chris Macdonald, CEO of Brooks Macdonald said: "OMX Securities helped us, quickly and efficiently, to meet the need to grow our business and have proved they are the right partner to support the continued expansion of our operation. The scalability of their clearing and settlement service will enable us to take additional new business well within our planned timeframes."
Angus Macdonald, CEO of OMX Securities comments: "OMX Securities is delighted to continue to support Brooks Macdonald to achieve its planned business growth. This project clearly signals that OMX Securities is well placed to provide wealth management firms with a flexible, responsive and professional clearing and settlement service."
OMX Securities has a proven track record in providing managed services to some of the UK's leading financial institutions. It supplies a complete business infrastructure to handle portfolio management, order management, execution, clearing, custody administration and settlement for wealth managers, institutional brokers and retail brokers.
Friday 30 May 2008
ACU Credit Union with Alchemy
The Algemene Spaar- en Kredietcoöperatie ACU (General Credit Union) recently celebrated it’s 45 years of existence and therefore unveiled, as part of it’s strategic vision to improve its overall services to it’s members, a plan to re-organize and update its internal support systems.
The ACU was founded 45 years ago to bring excellent financial services and access to capital within the reach of ordinary workers. As a result of their success in this mission, the ACU has now grown to serve more than 12,000 public and private sector workers across Curacao, Bonaire, St. Maarten, Saba and St. Eustatius. ACU makes it possible for it’s members to build up personal wealth and save for items such a home, pension or their children’s education.
Up till now, the ACU ran a traditional paper-based and manual back-office operation from its headquarters in Willemstad. This resulted in unnecessary lengthy and time-consuming amount of transaction processing times by ACU staff. Customers were also required to call ACU for service, or come in and wait in line for service.
“The executive team of ACU has developed a dynamic and visionary plan to provide new state of the art services for her growing customer base. These include sophisticated Internet banking and express domestic and internal transfers.” said Mr. Eldrid Fos, Operations Manager of ACU. “After a careful review we are delighted to find that IBIS Management based right here in Curacao is the number one provider of banking technology and advisory services in the Caribbean. So, it was a natural choice to choose their Alchemy Platform to implement our new strategy.”
ACU is also joining the ranks of leading financial institutions across the Caribbean that have chosen to completely automate their back office with the Alchemy Payment Processing Platform and Internet Banking from IBIS Management Associates. More than 25 leading international banks in the region use IBIS Management solutions to dramatically improve their profitability and efficiency.
As part of its operational upgrade, ACU will also be joining the National Clearing network of the Netherlands Antilles which will allow is to interact far more efficiently with other banks in the island.
“We are delighted to now also enable Credit Unions such as the ACU to offer their customers a world class level of excellence in technology and services.” said Clark Russel, CEO of IBIS Management. “Alchemy will allow ACU customers to view their account balance information, and to process any payment instantly.”
The ACU was founded 45 years ago to bring excellent financial services and access to capital within the reach of ordinary workers. As a result of their success in this mission, the ACU has now grown to serve more than 12,000 public and private sector workers across Curacao, Bonaire, St. Maarten, Saba and St. Eustatius. ACU makes it possible for it’s members to build up personal wealth and save for items such a home, pension or their children’s education.
Up till now, the ACU ran a traditional paper-based and manual back-office operation from its headquarters in Willemstad. This resulted in unnecessary lengthy and time-consuming amount of transaction processing times by ACU staff. Customers were also required to call ACU for service, or come in and wait in line for service.
“The executive team of ACU has developed a dynamic and visionary plan to provide new state of the art services for her growing customer base. These include sophisticated Internet banking and express domestic and internal transfers.” said Mr. Eldrid Fos, Operations Manager of ACU. “After a careful review we are delighted to find that IBIS Management based right here in Curacao is the number one provider of banking technology and advisory services in the Caribbean. So, it was a natural choice to choose their Alchemy Platform to implement our new strategy.”
ACU is also joining the ranks of leading financial institutions across the Caribbean that have chosen to completely automate their back office with the Alchemy Payment Processing Platform and Internet Banking from IBIS Management Associates. More than 25 leading international banks in the region use IBIS Management solutions to dramatically improve their profitability and efficiency.
As part of its operational upgrade, ACU will also be joining the National Clearing network of the Netherlands Antilles which will allow is to interact far more efficiently with other banks in the island.
“We are delighted to now also enable Credit Unions such as the ACU to offer their customers a world class level of excellence in technology and services.” said Clark Russel, CEO of IBIS Management. “Alchemy will allow ACU customers to view their account balance information, and to process any payment instantly.”
Sunday 25 May 2008
First Financial Network
First Financial Network (FFN) is a loan sale advisor. Their services include:
- Portfolio analysis and valuation
- Multiple bidding formats: sealed bid, on-line e-cry auction, negotiated sales
- Purchaser profiling
- Document imaging
- Online and traditional due diligence management
- Bulk Sales, One-Off Transactions and Pipeline Offerings
- Bid analysis and optimization
- Transaction negotiation and execution
- Data management
- System integration
- Transfer of ownership and servicing
- Post closing management
Friday 23 May 2008
Northern Trust Expands Reporting Tools
Northern Trust announced today it has expanded its array of reporting tools to support institutional investors in meeting new and complex requirements for corporate governance, financial disclosure, and regulatory filings in markets worldwide. New reports launched in 2008 will help clients comply with higher standards for transparency in class action processing, taxation, investment risks and accounting practices.
"As Northern Trust enters new markets around the globe, we continue to develop products to meet the local and regulatory needs of our worldwide client base," said Peter Cherecwich, Northern Trust's global head of asset servicing product development. "Corporations, public pension funds and not- for-profit institutions face increasingly complex challenges in managing governance, regulatory, accounting, investing, finance and fiduciary responsibilities. As global custodian, Northern Trust seeks to ease our clients' burden of achieving transparency while complying with all accounting, valuation and financial reporting standards."
Governance, regulatory and financial reporting requirements addressed by Northern Trust include class actions, GASB 40 and 50, IRRS 7 and Dutch Regulatory Reporting.
"As Northern Trust enters new markets around the globe, we continue to develop products to meet the local and regulatory needs of our worldwide client base," said Peter Cherecwich, Northern Trust's global head of asset servicing product development. "Corporations, public pension funds and not- for-profit institutions face increasingly complex challenges in managing governance, regulatory, accounting, investing, finance and fiduciary responsibilities. As global custodian, Northern Trust seeks to ease our clients' burden of achieving transparency while complying with all accounting, valuation and financial reporting standards."
Governance, regulatory and financial reporting requirements addressed by Northern Trust include class actions, GASB 40 and 50, IRRS 7 and Dutch Regulatory Reporting.
Saturday 17 May 2008
Sumitomo Considers Dividend Rise
Sumitomo Mitsui Financial Group (SMFG) might increase its full-year dividend, the Nikkei newspaper reports.
Japan's third-largest bank is to lift the payout by 17 per cent in the year to March 2009 - bringing it up from 2,000 to 14,000 yen.
The move would help to alleviate problems SMFG has been experiencing with its share price, which has fallen by 21 per cent over the past year.
SMFG refused to comment on the dividend speculation, Reuters reports.
Nevertheless, the markets reacted to the Nikkei report by increasing shares in the bank by one per cent - comparing favourably with the overall 0.4 per cent rise on the exchange.
SMFG also posted a five per cent rise in annual profit, with healthy sales of bonds counterbalancing credit crunch-related losses at the bank.
Overall net income for the year to March 2008 stood at 462 billion yen - around $4.4 billion.
Japan's third-largest bank is to lift the payout by 17 per cent in the year to March 2009 - bringing it up from 2,000 to 14,000 yen.
The move would help to alleviate problems SMFG has been experiencing with its share price, which has fallen by 21 per cent over the past year.
SMFG refused to comment on the dividend speculation, Reuters reports.
Nevertheless, the markets reacted to the Nikkei report by increasing shares in the bank by one per cent - comparing favourably with the overall 0.4 per cent rise on the exchange.
SMFG also posted a five per cent rise in annual profit, with healthy sales of bonds counterbalancing credit crunch-related losses at the bank.
Overall net income for the year to March 2008 stood at 462 billion yen - around $4.4 billion.
Friday 16 May 2008
CheckFree PaymentView from Fiserv
Fiserv, Inc. (NASDAQ: FISV), a leading provider of information technology services to the financial and insurance industries, today announced the release of its CheckFree PaymentView™ solution, a comprehensive, web-based payments monitoring system with a dashboard view across existing check, cash, wire, Automated Clearing House (ACH), credit and debit card activities. PaymentView gives banks of any size and their corporate treasury clients real-time risk management capabilities along with multiple operational cost-savings and fee income opportunities.
“PaymentView is an exciting solution using interactive Web 2.0 technology and is designed to offer our bank clients and their corporate customers an intuitive, personalized offering for operational and payment risk monitoring across all payment types,” said Sam Robb, vice president, global payment solutions, CheckFree, now part of Fiserv. “The business case for PaymentView is being justified by our customers who are reporting new corporate revenue opportunities through increased retention and share-of-wallet with their target customers. They are also reporting significant projected reductions in customer service and exception processing costs.”
The PaymentView solution leverages existing bank technology investments and features a series of key modules, including:
• Centralized end-to-end check monitoring, including source capture monitoring
• Real-time business process monitoring for more comprehensive compliance and risk management
• Real-time alerts about operational events that have the potential to result in losses
• Robust reporting and analytics functionality providing banks new treasury services revenue opportunities through corporate payments trending, historical performance and forecasting
According to a survey of U.S.-based corporate treasurers, conducted by The Marketing Workshop, Inc. in September 2007, 44 percent of respondents said gathering and compiling information across multiple payment systems was difficult within their organizations. The research also revealed that business customers have a lack of visibility into payment status to determine cash position and would value more data for liquidity, cost and risk management analysis. Additionally, respondents agreed that there is limited tracking of internal/external compliance activity and few proactive alerts in place to warn about issues that have the potential to result in losses. The CheckFree PaymentView™ solution is meant to address these issues.
“Many banks are working toward achieving a consolidated view across their payments operations and technology silos to improve efficiencies both internally and for their corporate clients,” said Susan Feinberg, research director for Wholesale Banking at TowerGroup. “Large and small banks alike are exploring an enterprise payments strategy and applying a more holistic approach to their payment architecture. By doing so, they can offer greater visibility of business processes to their corporate customers while improving their ability to manage risk across payment channels and payment methods.”
By design, the CheckFree PaymentView solution accesses and integrates information from various payment systems and delivers relevant information to the desktops of authorized employees throughout the organization. This solution includes dashboards, standard and user-defined summary information reports, detailed data about processing and tracking payment status, risk exposure, out-of-compliance situations and key performance indicators. It also delivers subscription-based, real-time alerts to operators and managers concerning operational events requiring attention such as process bottlenecks.
“PaymentView is an exciting solution using interactive Web 2.0 technology and is designed to offer our bank clients and their corporate customers an intuitive, personalized offering for operational and payment risk monitoring across all payment types,” said Sam Robb, vice president, global payment solutions, CheckFree, now part of Fiserv. “The business case for PaymentView is being justified by our customers who are reporting new corporate revenue opportunities through increased retention and share-of-wallet with their target customers. They are also reporting significant projected reductions in customer service and exception processing costs.”
The PaymentView solution leverages existing bank technology investments and features a series of key modules, including:
• Centralized end-to-end check monitoring, including source capture monitoring
• Real-time business process monitoring for more comprehensive compliance and risk management
• Real-time alerts about operational events that have the potential to result in losses
• Robust reporting and analytics functionality providing banks new treasury services revenue opportunities through corporate payments trending, historical performance and forecasting
According to a survey of U.S.-based corporate treasurers, conducted by The Marketing Workshop, Inc. in September 2007, 44 percent of respondents said gathering and compiling information across multiple payment systems was difficult within their organizations. The research also revealed that business customers have a lack of visibility into payment status to determine cash position and would value more data for liquidity, cost and risk management analysis. Additionally, respondents agreed that there is limited tracking of internal/external compliance activity and few proactive alerts in place to warn about issues that have the potential to result in losses. The CheckFree PaymentView™ solution is meant to address these issues.
“Many banks are working toward achieving a consolidated view across their payments operations and technology silos to improve efficiencies both internally and for their corporate clients,” said Susan Feinberg, research director for Wholesale Banking at TowerGroup. “Large and small banks alike are exploring an enterprise payments strategy and applying a more holistic approach to their payment architecture. By doing so, they can offer greater visibility of business processes to their corporate customers while improving their ability to manage risk across payment channels and payment methods.”
By design, the CheckFree PaymentView solution accesses and integrates information from various payment systems and delivers relevant information to the desktops of authorized employees throughout the organization. This solution includes dashboards, standard and user-defined summary information reports, detailed data about processing and tracking payment status, risk exposure, out-of-compliance situations and key performance indicators. It also delivers subscription-based, real-time alerts to operators and managers concerning operational events requiring attention such as process bottlenecks.
CA Cheuvreux Joins Euro Millenium
CA Cheuvreux has joined Euro Millennium, a neutral dark pool of liquidity for pan-European listed cash equities that was successfully launched by NYFIX International earlier this year.
CA Cheuvreux will offer the benefits of reduced market impact and anonymity to its large base of buy-side and sell-side firms, offering a reliable and proven answer to the dramatic changes observed in European equity markets since the implementation of MiFID.
Euro Millennium is the first truly open European dark pool. It currently matches UK-listed equities, and will be rolling out other major European markets over the course of 2008. Euro Millennium is built upon the proven technology that powers NYFIX Millennium(R), a leading independent US dark pool in operation for the past seven years. Euro Millennium allows participation from both buy-side and sell-side firms seeking price improvement and minimal market impact.
Jerry Lees, Head of Alternative Execution Services at CA Cheuvreux commented: "CA Cheuvreux's strategy is to offer neutral, unbiased access to all new liquidity venues across Europe, enabling our clients to customise their Smart Order Routing strategies to achieve their investment objectives. As the first European neutral dark pool, Euro Millennium further increases the liquidity options open to our clients."
Adding to this, Chris Smith, Director, NYFIX International, said: “Euro Millennium was born out of a committed year-long partnership with buy-side and sell-side participants who have provided valuable advice and feedback through our Advisory Board. We are very proud that Euro Millennium reflects the rapidly evolving needs of our clients in today’s environment of dramatic regulatory change and increased competition. CA Cheuvreux joining Euro Millennium reinforces the depth and neutrality offered by the platform and we are delighted to have them onboard.
CA Cheuvreux will offer the benefits of reduced market impact and anonymity to its large base of buy-side and sell-side firms, offering a reliable and proven answer to the dramatic changes observed in European equity markets since the implementation of MiFID.
Euro Millennium is the first truly open European dark pool. It currently matches UK-listed equities, and will be rolling out other major European markets over the course of 2008. Euro Millennium is built upon the proven technology that powers NYFIX Millennium(R), a leading independent US dark pool in operation for the past seven years. Euro Millennium allows participation from both buy-side and sell-side firms seeking price improvement and minimal market impact.
Jerry Lees, Head of Alternative Execution Services at CA Cheuvreux commented: "CA Cheuvreux's strategy is to offer neutral, unbiased access to all new liquidity venues across Europe, enabling our clients to customise their Smart Order Routing strategies to achieve their investment objectives. As the first European neutral dark pool, Euro Millennium further increases the liquidity options open to our clients."
Adding to this, Chris Smith, Director, NYFIX International, said: “Euro Millennium was born out of a committed year-long partnership with buy-side and sell-side participants who have provided valuable advice and feedback through our Advisory Board. We are very proud that Euro Millennium reflects the rapidly evolving needs of our clients in today’s environment of dramatic regulatory change and increased competition. CA Cheuvreux joining Euro Millennium reinforces the depth and neutrality offered by the platform and we are delighted to have them onboard.
Berkshire Hathaway Not Bidding for RBS Insurance
Berkshire Hathaway will not bid for the $14 billion auction of the Royal Bank of Scotland's insurance business.
The firm, owned by billionaire investor Warren Buffett, has not given a reason for the pull-out.
"Although we had looked at it, we are not participating in the bidding," said Debbie Bosanek of Berkshire Hathaway.
The bank has also refused to comment, the Financial Times reports.
Buyers still left in the auction include Assicurazioni Generali SPA, AXA SA, Allianz SE and Zurich Financial AG.
Several private equity groups have already been excluded for not being able to raise the funds necessary.
Insurers Direct Line and Churchill, both owned by the bank, are for sale in the auction.
The deadline for bids is May 28th.
The firm, owned by billionaire investor Warren Buffett, has not given a reason for the pull-out.
"Although we had looked at it, we are not participating in the bidding," said Debbie Bosanek of Berkshire Hathaway.
The bank has also refused to comment, the Financial Times reports.
Buyers still left in the auction include Assicurazioni Generali SPA, AXA SA, Allianz SE and Zurich Financial AG.
Several private equity groups have already been excluded for not being able to raise the funds necessary.
Insurers Direct Line and Churchill, both owned by the bank, are for sale in the auction.
The deadline for bids is May 28th.
Thursday 8 May 2008
MarketAxess Results
MarketAxess Holdings Inc. (NASDAQ:MKTX) , the operator of a leading electronic trading platform for U.S. and European high-grade corporate bonds, emerging markets bonds and other types of fixed-income securities, today announced results for the first quarter ended March 31, 2008.
Total revenues for the first quarter of 2008 decreased 3.5% to $22.9 million, compared to $23.8 million for the first quarter of 2007. Pre-tax income for the first quarter of 2008 was $3.0 million, compared to $4.5 million for the first quarter of 2007, a decrease of 33.7%. Net income for the first quarter of 2008 totaled $1.6 million, or $0.05 per share on a diluted basis, compared to $2.5 million, or $0.07 per share on a diluted basis, for the first quarter of 2007.
For the first quarter of 2007, pre-tax margin was 12.9%, compared to 18.8% for the first quarter of 2007.
Richard M. McVey, chairman and chief executive officer of MarketAxess, commented, "Our base of recurring revenue, the improving quality of business traded over the MarketAxess platform, and growing contributions from new businesses all helped to preserve profitability and cash flow through these extraordinary times for credit markets, although trading volumes during the first quarter continued to be negatively impacted by dealer balance sheet constraints. Our strategy to increase client technology integration and expand customer order flow is on track, and we continue opportunistically to explore means to enhance the liquidity available to our dealer and investor clients on our platform. Importantly, business diversification is improving, advanced by our acquisition of Greenline Financial Technologies, Inc. ("GFT"), and we see significant opportunities for growth when market conditions stabilize."
First Quarter Results
Total revenue for the first quarter of 2008 decreased 3.5% to $22.9 million, compared to $23.8 million for the first quarter of 2007. Commission revenue totaled $19.3 million on total trading volume of $64.5 billion for the first quarter of 2008, compared to $20.7 million in commission revenue on total trading volume of $104.5 billion for the first quarter of 2007. U.S. high-grade corporate bond commissions decreased 9.4% to $12.4 million on trading volume of $38.8 billion for the first quarter of 2008, compared to $13.7 million in commissions on trading volume of $60.8 billion for the first quarter of 2007. U.S. high-grade fixed-rate and floating-rate bond trading volume in the first quarter of 2008 totaled $33.5 billion and $2.8 billion, respectively, compared to $40.4 billion and $15.5 billion, respectively, in the first quarter of 2007. Total U.S. high-grade trading volume includes single-dealer inquiries of $2.4 billion and $4.9 billion for the first quarter of 2008 and the first quarter of 2007, respectively. U.S. high-grade trading volume as a percentage of FINRA's high-grade TRACE trading volume decreased to an estimated 7.3% for the first quarter of 2008, compared to an estimated 9.4% for the first quarter of 2007.
European high-grade corporate bond commissions decreased 3.5% to $4.6 million on trading volume of $8.1 billion for the first quarter of 2008, compared to $4.8 million in commissions on trading volume of $28.3 billion for the first quarter of 2007. European high-grade bond commissions in the first quarter of 2008 included distribution fees of $3.7 million and variable transaction fees of $0.9 million, based on the European pricing plan that was introduced in June 2007.
Other commissions, which include emerging markets, high yield, credit default swaps and agencies, increased 2.1% to $2.3 million on trading volume of $17.6 billion for the first quarter of 2008, compared to $2.3 million in commissions on $15.3 billion in trading volume for the first quarter of 2007.
Technology products and services, which reflects revenue for technology licenses, support and professional services from our recent acquisitions of GFT and Trade West Systems ("TWS"), totaled $0.8 million in the first quarter of 2008.
Other revenue, which consists of information and user access fees, investment income and other revenue, decreased 5.6% to $2.9 million for the first quarter of 2008, compared to $3.0 million for the first quarter of 2007.
There were a total of 61 and 62 trading days in the U.S. and U.K., respectively, in the first quarter of 2008, compared to 62 and 64 trading days in the U.S. and U.K., respectively, in the first quarter of 2007.
Total expenses for the first quarter of 2008, which include expenses from the acquisition of GFT and TWS, increased 3.5% to $20.0 million, compared to $19.3 million for the first quarter of 2007. Employee compensation and benefits expense, which includes $0.4 million in severance costs, decreased 4.2% to $11.0 million, compared to $11.5 million for the first quarter of 2007. Professional and consulting expenses increased 17.3% to $2.2 million, compared to $1.8 million for the first quarter of 2007. General and administrative expenses increased 32.8% to $1.6 million, compared to $1.2 million for the first quarter of 2007.
Pre-tax income for the first quarter of 2008 was $3.0 million, compared to $4.5 million for the first quarter of 2007. Pre-tax margin was 12.9% for the first quarter of 2008, compared to 18.8% for the first quarter of 2007.
The effective tax rate for the first quarter of 2008 was 46.2%, compared to 45.2% for the first quarter of 2007. The first quarter 2008 effective tax rate was unfavorably impacted by the absence of a research and development tax credit, a decrease in tax-exempt investment income and a relative increase in non-deductible expenses.
Net income for the first quarter of 2008 was $1.6 million, or $0.05 per diluted share, compared to $2.5 million, or $0.07 per diluted share, for the first quarter of 2007.
Employee headcount as of March 31, 2008 was 202, compared to 171 as of March 31, 2007. First quarter 2008 headcount includes the addition of 25 employees from the acquisition of GFT on March 5, 2008.
Total revenues for the first quarter of 2008 decreased 3.5% to $22.9 million, compared to $23.8 million for the first quarter of 2007. Pre-tax income for the first quarter of 2008 was $3.0 million, compared to $4.5 million for the first quarter of 2007, a decrease of 33.7%. Net income for the first quarter of 2008 totaled $1.6 million, or $0.05 per share on a diluted basis, compared to $2.5 million, or $0.07 per share on a diluted basis, for the first quarter of 2007.
For the first quarter of 2007, pre-tax margin was 12.9%, compared to 18.8% for the first quarter of 2007.
Richard M. McVey, chairman and chief executive officer of MarketAxess, commented, "Our base of recurring revenue, the improving quality of business traded over the MarketAxess platform, and growing contributions from new businesses all helped to preserve profitability and cash flow through these extraordinary times for credit markets, although trading volumes during the first quarter continued to be negatively impacted by dealer balance sheet constraints. Our strategy to increase client technology integration and expand customer order flow is on track, and we continue opportunistically to explore means to enhance the liquidity available to our dealer and investor clients on our platform. Importantly, business diversification is improving, advanced by our acquisition of Greenline Financial Technologies, Inc. ("GFT"), and we see significant opportunities for growth when market conditions stabilize."
First Quarter Results
Total revenue for the first quarter of 2008 decreased 3.5% to $22.9 million, compared to $23.8 million for the first quarter of 2007. Commission revenue totaled $19.3 million on total trading volume of $64.5 billion for the first quarter of 2008, compared to $20.7 million in commission revenue on total trading volume of $104.5 billion for the first quarter of 2007. U.S. high-grade corporate bond commissions decreased 9.4% to $12.4 million on trading volume of $38.8 billion for the first quarter of 2008, compared to $13.7 million in commissions on trading volume of $60.8 billion for the first quarter of 2007. U.S. high-grade fixed-rate and floating-rate bond trading volume in the first quarter of 2008 totaled $33.5 billion and $2.8 billion, respectively, compared to $40.4 billion and $15.5 billion, respectively, in the first quarter of 2007. Total U.S. high-grade trading volume includes single-dealer inquiries of $2.4 billion and $4.9 billion for the first quarter of 2008 and the first quarter of 2007, respectively. U.S. high-grade trading volume as a percentage of FINRA's high-grade TRACE trading volume decreased to an estimated 7.3% for the first quarter of 2008, compared to an estimated 9.4% for the first quarter of 2007.
European high-grade corporate bond commissions decreased 3.5% to $4.6 million on trading volume of $8.1 billion for the first quarter of 2008, compared to $4.8 million in commissions on trading volume of $28.3 billion for the first quarter of 2007. European high-grade bond commissions in the first quarter of 2008 included distribution fees of $3.7 million and variable transaction fees of $0.9 million, based on the European pricing plan that was introduced in June 2007.
Other commissions, which include emerging markets, high yield, credit default swaps and agencies, increased 2.1% to $2.3 million on trading volume of $17.6 billion for the first quarter of 2008, compared to $2.3 million in commissions on $15.3 billion in trading volume for the first quarter of 2007.
Technology products and services, which reflects revenue for technology licenses, support and professional services from our recent acquisitions of GFT and Trade West Systems ("TWS"), totaled $0.8 million in the first quarter of 2008.
Other revenue, which consists of information and user access fees, investment income and other revenue, decreased 5.6% to $2.9 million for the first quarter of 2008, compared to $3.0 million for the first quarter of 2007.
There were a total of 61 and 62 trading days in the U.S. and U.K., respectively, in the first quarter of 2008, compared to 62 and 64 trading days in the U.S. and U.K., respectively, in the first quarter of 2007.
Total expenses for the first quarter of 2008, which include expenses from the acquisition of GFT and TWS, increased 3.5% to $20.0 million, compared to $19.3 million for the first quarter of 2007. Employee compensation and benefits expense, which includes $0.4 million in severance costs, decreased 4.2% to $11.0 million, compared to $11.5 million for the first quarter of 2007. Professional and consulting expenses increased 17.3% to $2.2 million, compared to $1.8 million for the first quarter of 2007. General and administrative expenses increased 32.8% to $1.6 million, compared to $1.2 million for the first quarter of 2007.
Pre-tax income for the first quarter of 2008 was $3.0 million, compared to $4.5 million for the first quarter of 2007. Pre-tax margin was 12.9% for the first quarter of 2008, compared to 18.8% for the first quarter of 2007.
The effective tax rate for the first quarter of 2008 was 46.2%, compared to 45.2% for the first quarter of 2007. The first quarter 2008 effective tax rate was unfavorably impacted by the absence of a research and development tax credit, a decrease in tax-exempt investment income and a relative increase in non-deductible expenses.
Net income for the first quarter of 2008 was $1.6 million, or $0.05 per diluted share, compared to $2.5 million, or $0.07 per diluted share, for the first quarter of 2007.
Employee headcount as of March 31, 2008 was 202, compared to 171 as of March 31, 2007. First quarter 2008 headcount includes the addition of 25 employees from the acquisition of GFT on March 5, 2008.
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