Banks Join Instant Chat

Goldman Sachs Group Inc, JPMorgan Chase & Co and six other financial institutions have agreed to join a new instant messaging network from Markit and Thomson Reuters Corp to connect disparate messaging systems.

The network, called Markit Collaboration Services, launched on Monday and allows members to chat with one another regardless of the proprietary messaging technology that each firm uses.

This open platform differs Bloomberg LP’s messaging system, which is a closed network only for users of Bloomberg terminals.

Bloomberg messaging is the most popular form of chat on Wall Street, and often cited as one of the reasons banks are willing to pay around $20,000 a year for a subscription to a Bloomberg terminal.

Markit and Thomson Reuters said they hoped their open messaging network will attract banks that want to chat with their clients or other financial institutions but cannot currently do so because they are on different messaging systems.

The other banks that have joined the new network are Deutsche Bank, Bank of America Merrill Lynch, Barclays, Citigroup, Credit Suisse and Morgan Stanley, according to a statement from Markit.

The banks collectively employ more than 1 million people worldwide, though it was not immediately clear how many individuals will use the new Markit service.

David Craig, president of Thomson Reuters’ Financial & Risk division, said one of the challenges facing banks is that their messaging systems do not always talk to one another. “That creates costs and complexity,” he said.

Markit and Thomson Reuters said the messages on the new network are encrypted, and the system does not store them.

Representatives from Bank of America, Deutsche Bank, Goldman Sachs and Morgan Stanley were not immediately available to comment on the new messaging system. Representatives from Barclays, Citi, Credit Suisse and JPMorgan also declined to comment.

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Verizon Introduces HSN For Financial Firms

Verizon on Wednesday launched a new low-latency network for financial services firms that can complete a stock transaction between New York and Chicago in as little as 14.5 milliseconds.

The new Verizon Financial Network Premier Low-Latency Service shaves as much as 5 milliseconds off the company’s current offering, a change that can translate into millions of dollars for high-frequency traders.

The new service, which becomes part of the Verizon Financial Network, uses higher performance networking technology from Ciena and takes the shortest possible path between the two metropolitan areas, according to Verizon.

Verizon is targeting the service to global banks, hedge funds, pre- and post-trade service firms and money managers who use high-performance computing algorithms and networks for speedy transactions.

High-frequency trading firms require low-latency networks to execute arbitrage transactions and algorithmic trading with minimal delay. Fiber distance between trading locations introduces latency, as does the equipment used to light the fiber.

Verizon plans on expanding the new high-speed network to other U.S. markets later this year.

CME Group, a financial derivatives marketplace, plans to use the new Verizon service in its Aurora, Ill., data and colocation center to enable companies in Chicago and New York to trade on CME Group’s platforms and more quickly exchange market data.

“We’re creating a secure, reliable high-speed path along one of the busiest financial trading routes,” Chandan Sharma, managing director of Verizon’s financial vertical markets, said in a statement.

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