Digital evolution in debt issuance - ICMA primary markets technology directory review


20 March 2023 The digital evolution of issuing bonds is driving both new solutions and at the same time vendor consolidation. ICMA's most recent assessment of its primary markets technology directory has identified several new and emerging platforms designed to facilitate the issuance of debt instruments. However, the review also highlighted that certain previously listed solutions are no longer available or in development. As of the time of publication, the directory comprises a total of 45 solutions, representing a slight decrease from Q4 2021, and more than double the number available when the directory was launched in 2018.

The directory seeks to provide greater transparency in a rapidly expanding competitive marketplace by comparing the key features and capabilities of technology solutions available to automate all or part of the process of issuing debt securities. The scope includes bonds, but also other types of debt instruments such as commercial paper, loans and Schuldscheine. It highlights whether the various solutions are aimed at underwriters, investors, issuers or others, at what stage of the issuance process they can be utilised, supported issuance methods as well as connectivity options.

Key observations:

  • Distributed ledger technology: As more participants look toward the potential gains of using DLT, several platforms have emerged to provide tokenisation-related services for debt securities. Bonds in a tokenised form may for instance allow for allocations and interest payments to be automated with the use of smart contracts, while other vendors leverage DLT to provide users with a ‘source of truth’ for transaction details.
  • Connectivity: Several vendors announced enhanced connectivity between their solutions and other market platforms, such as linking buy-side OEMS’ with syndicate banks as part of the bookbuilding process.
  • Prior solutions: Since the initial tracking of issuance technologies, 14 solutions have been removed from the directory. Reasons range from consolidation and re-branding following acquisitions or partnerships, to platform unwinding due to unfavourable conditions or uptake. Prior solutions are listed within a separate tab.

Various other enhancements have also been announced by vendors such as increased product scope and jurisdiction coverage. Some platforms have also extended their support to additional issuance methods, for example supporting syndication after an initial focus on private placement.

Against the backdrop of growth in vendor solutions and the risk of fragmentation, ICMA and its primary market constituents have developed a Bond Data Taxonomy (BDT) to provide data definitions for over 90 fields representing key economics, dates, and other information typically included within a term sheet for vanilla bonds, in a structured and machine-readable format. The BDT provides a vendor-agnostic common language when exchanging data electronically across the issuance process.

The primary markets technology directory is a unique resource available to members and regulators through the ICMA website.

The directory does not constitute an exhaustive list of providers in the market. Other relevant providers that are not yet covered by the directory and wish to join are welcome to do so. Please contact us for further details.

ICMA’s technology directories are also available to non-members on a subscription basis.

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