BMO And Ontario Teachers’ Are Testing Blockchain Technology For Fixed Income Markets

BMO is entering fixed income markets with a leading pension fund investor. BMO Capital Markets today reported that it has effectively propelled a pilot fixed income issuance transaction, mirrored on a blockchain platform alongside driving pension fund investor Ontario Teachers’ Pension Plan (Ontario Teachers’).

The transaction included Bank of Montreal as the issuer and Ontario Teachers’ as the purchaser of a CDN$250MM 1-year floating rate Deposit Note, making it the first fixed income issuance demonstrating the viability of blockchain platforms.

BMO Capital Markets designed and assembled a blockchain issuance system utilizing open source blockchain infrastructure with the objective of testing a next-generation settlement system. The prototype permits the security issuer and buyer to see the transaction on the blockchain and confirm the precision of the term sheet information and payment amounts until the maturity of the fixed income security. The technology is planned to enable cost reduction in a few regions including compliance, financial reporting, security clearing and settlement of cash transactions.

The pilot transaction – booked as a traditional Canadian Depository for Securities (CDS) issuance and effectively paralleled through the blockchain – was led to exhibit how smart contracts and blockchain could be utilized for fixed income markets.

Kelsey Gunderson, Head of Global Trading, BMO Capital Markets says that this is a vital initial phase in building up a completely practical blockchain capability that we think will, in the long run, permit primary and secondary exchanging of securities. They comprehend the potential that blockchain brings to the capital markets and they anticipate proceeding to drive innovative solutions to encourage their customers.

As reported by News Wire Cision, Ontario Teachers’ is dedicated to exploring technology and developments that may enhance the capacity to serve their individuals. They are pleased to collaborate with Bank of Montreal in this pilot blockchain activity.

Expanding on the fruitful launch of the prototype and entering the fixed income markets, BMO Capital Markets will hope to keep on partnering with customers and different institutions in the evolution of blockchain as an open settlement system

The post BMO And Ontario Teachers’ Are Testing Blockchain Technology For Fixed Income Markets appeared first on OWLT Market.

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