Funds News

Banks to Sell Stake in Boat to Markit -Sources

LONDON (Reuters) - The nine investment banks that set up trade-reporting platform Project Boat are selling their stakes to Markit, the data vendor that operates the platform, people familiar with the matter said on Monday.

The bank consortium, which hired Markit to operate the equity trade-reporting system a year ago, has agreed to spin off Project Boat three months after it went live, to make the platform more independent, the sources said, without disclosing the value of the stake.

A spokeswoman at Markit declined to comment.

Project Boat was set up in September 2006 by ABN Amro ABNA.KA, Citigroup C.N, Credit Suisse CSGN.VX, Deutsche Bank DBKGn.DE, Goldman Sachs GS.N, HSBC HSBA.L0005.HK, Merrill Lynch MER.N, Morgan Stanley MS.N and UBS UBSN.VX, to compete with Europe's stock exchanges in data provision.

London Stock Exchange LSE.L, which offers a similar service, had slashed its trade-reporting fees by 80 percent when new European financial regulations, known as MiFID (Markets in Financial Instruments Directive), became effective in November.

More than 22 investment houses now use Boat to meet their over the counter equity reporting obligations required by MiFID.

Analysts had expected revenues from the sale of market data of European exchanges such as the LSE and Nordic bourses operator OMX OMX.ST to decline after the launch of Project Boat.

Reporting by Daisy Ku; Editing by Quentin Bryar