Blackbird completes first FpML trades

Blackbird, the North Carolina-based electronic market-place for over-the-counter interest rate derivatives, has completed the first swap trades on an electronic network using Financial Products Markup Language, or FpML. The deals are the first practical use between swap counterparties of the FpML language, which has been under development for three years.

The trades were euro interest rate swaps conducted by several sets of counterparties, which Blackbird declined to name. “Using the Blackbird System, you do more than trade,” said Blackbird president and co-founder Shawn Dorsch. “You create a precise, electronic record of deals as agreed to on- or off-line. This is a significant advance in straight-through processing - trades can be captured at execution and fed instantly to each department that requires the trade information.”

Blackbird customers may use FpML to book trades they have not necessarily made through Blackbird, Mark Brickell, chief executive officer of Blackbird, told RiskNews. “The back-office book-keeping advance represented by FpML presumably would make it attractive for customers to use FpML through Blackbird to record other interest rate derivatives trades,” he said.

The transactions show progress in the move to make swap activity electronic and improve processing. The FpML electronic language has been developed by a consortium of swaps participants, and led by dealers through the industry trade group Isda, the International Swaps and Derivatives Association.