- Independent broker-dealer to use Calypso System as core engine for new interest rates swaps trading subsidiary
San Francisco, CA – April 10, 2012 – Calypso Technology, Inc., the global capital markets platform provider, today announced that Pierpont Derivatives LLC (“Pierpont Derivatives”) has gone live with the Calypso System to support the launch of a new swaps trading business. The firm’s trading desk is using the platform for trade pricing and capture, consolidated P&L and risk management for interest rate swaps, futures and treasuries.
Pierpont Derivatives is a wholly-owned subsidiary of Pierpont Securities Holdings LLC, which is the sole owner of Pierpont Securities LLC, an SEC-registered broker-dealer providing institutional clients with liquidity, execution services and strategic advice pertaining to the US Treasury, federal agency and repurchase markets. Prior to the launch of its interest rate swaps trading business, Pierpont Derivatives was seeking a robust technology solution that would allow it to go to market quickly. After a thorough selection process, Pierpont Derivatives selected the Calypso System based on its advanced front-office functionality for OTC derivatives and other capital market products as well as its central clearing capabilities and seamless integration with swaps market participants.
Commenting on the selection of the Calypso System, Akshay Das, Managing Director and Head of Derivatives at Pierpont Derivatives, notes, “Speed to market was absolutely crucial due to how quickly the swaps market is changing. We needed an innovative technology solution that could comprehensively support the launch of our new business – as well as allow us to enter new derivatives trading markets in the future. Calypso was the obvious choice. The Calypso team delivered the expertise and flexibility to quickly get us up and running with the specific capabilities we needed.” Pierpont Derivatives benefits from Calypso’s core OTC derivatives valuation support and flexibility, especially as Pierpont Derivatives continues to build out its proprietary models and to enhance its capabilities with value-added, customized features.
The post-crisis changes in the swaps market include a major industry shift in interest rates swaps pricing, including a move to OIS discounting from LIBOR discounting. Meeting Pierpont Derivatives’ rigorous requirements, the Calypso System provides Pierpont Derivatives with robust curve construction capabilities to ensure the firm is utilizing the most current valuation techniques.
Furthermore, the Calypso System is the leading solution for firms seeking to meet the needs of the newly mandated central clearing of OTC interest rate swaps. The Calypso System has enabled Pierpont Derivatives to clear, directly and centrally, its interest rate swaps through its clearing broker, or futures commission merchant, on CME Clearport and the SwapClear platform of LCH.Clearnet through a MarkitWire interface.
“The swaps market is truly undergoing a revolutionary change,” comments Charles Marston, CEO of Calypso Technology. “We’re pleased to be working with Pierpont Derivatives in preparing them for and allowing them to launch a new business in light of this fundamental industry overhaul. The ease in which Pierpont Derivatives has gone to market reflects our commitment to seamless implementation and innovation in technology. We take pride in our central role in the OTC derivatives clearing ecosystem and we look forward to our continued expansion in this space.”
About Pierpont Derivatives, LLC.
Organized in 2011, Pierpont Derivatives LLC is a wholly-owned subsidiary of Pierpont Securities Holdings LLC and an affiliate of Pierpont Securities LLC, which is an independent, SEC-registered broker-dealer. Pierpont Derivatives is actively trading interest rate swaps and clearing through SwapClear of LCH.Clearnet and through the CME Group. Pierpont Securities provides institutional clients liquidity, execution and strategic advice in connection with fixed-income products, including US Treasury and Agency securities as well as repo and alternative financing products. Pierpont Derivatives clears its trading of fixed-income products (other than interest rate swaps) through Pierpont Securities.
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