The Irish Stock Exchange (ISE), in an effort to attract more foreign members and make its stocks more visible, has signed a letter of intent to trade all of its products on the Deutsche Borses (DBs) Xetra trading platform. At the same time, the ISE is considering joining the pan-European equity markets alliance that is led by the London Stock Exchange and the Deutsche Borse A.G.-the DBs German stock market subsidiary.
Tom Healy, CEO of the ISE, says the exchange expects to list its full complement of equities and corporate bond instruments on Xetra by the second quarter. After the products are ported over to Xetra, he says, the ISE will effectively be transitioned from a telephone-driven market to an all-electronic exchange.
By making all of its products accessible via a fully electronic trading platform, the ISE will become more visible to stock brokerage firms across Europe, says Healy. In turn, the exchange expects to attract more foreign members.
Today, the ISEs membership is comprised of 12 Dublin-based firms and one London-based firm. But, as a result of its partnership with the DB, Healy says the ISE expects its membership to double by year-end-with the majority of that group residing in foreign countries.
While declining to specify which other systems the ISE considered, Healy says that the DB will be responsible for providing the ISEs members with a gateway to Xetra. Currently, several independent software vendors (ISVs) provide front-end access to Xetra. It is doubtful, however, that the ISEs members will work with those ISV.
Separate from its partnership with the DB, the ISE is also leaning toward joining the newly created pan-European stock market. Formed last year, that market is comprised of eight equity exchanges that have allied in an attempt to create a single market for trading European blue-chip stocks.