1. EuroTLX Market structure and strategic developments

2. Who we are

3. Who we are
EuroTLX is an MTF that offers the possibility to trade electronically a wide range of financial instruments, such as bonds plain vanilla, structured bonds, corporate bonds, government bonds, and investment certificates.
EuroTLX ownership:
15%
70%
15%
Mission: a European MTF for the trading of fixed income securities in retail-size and investment products mainly distributed to non professional investors.
Values:
Transparency;
Liquidity;
Easy access to a wide offer of fixed income securities and investment certificates
Unique Selling Proposition: an integrated e-trading and compliance-supporting service for banks in the European MiFID II arena.

4. Milestones
2000
UniCredit Group launches its ATS, TLX.
TLX S.p.A. manages the regulated exchange TLX and the MTF EuroTLX.
Banca IMI acquires a 50% stake of TLX S.p.A.
The ECB acknowledges EuroTLX as a “Non-regulated market acceptable by the ECB for collateral management purposes”.
With the shutdown of TLX, the company name changes into EuroTLX SIM S.p.A. and all trading activity is focused on the MTF EuroTLX. Bilateral netting on non-domestic securities enters into force. The Cassiopeia Committee recognizes the uniqueness of the existing structure of EuroTLX, that “can be leveraged to build out an institutional market on an all to all basis”.
Introduction of Central Clearing Counterparty for domestic securities. UBS first non-Italian Broker. In the sole “BTP Day” (November 28), trades and turnover are respectively 53,600 and 1.2 billion euro.
For the first time, the total agency flow of non-members exceeds that of the two shareholders. Record of monthly turnover (12.1 billion euro) registered in October.
On September 24th, Borsa Italiana acquires 70% of the share capital of EuroTLX SIM S.p.A. Unicredit and Banca IMI retain a minority stake of 15% for each bank.
On July 21st EuroTLX trading platform migrates on Millennium IT that is the same platform in use for the markets managed by the Italian Stock Exchange and the London Stock Exchange.
Introduction of Request For Quote (RFQ) functionality for trading larger sizes using the EuroTLX market infrastructure.
2003
2006
2007
2010
2011
2012
2013
2014
2016

5. EuroTLX community

6. Electronic Central Limit Order Book
How EuroTLX market works
Market Maker A
Market Maker B
Specialist
Post Trading
Electronic Central Limit Order Book
Market Data
Broker 1 (client activity)
Broker 2 (client activity)
Broker … (client activity)
Prices on EuroTLX website with 15’ delay
Info Providers
Fact Sheets freely downloadable from EuroTLX website
Retail Investor
Asset Manager
Private Banker

7. EuroTLX Market Roles Liquidity Provider Broker Market Maker A
Provides liquidity on minimum 250 instruments;
must join the market also as a broker;
competitive fee schedule.
Market Maker B
Minimum quoted instruments: 30;
does not have to join also as a broker;
possibility of chosing between two different fee schedules (Line 1 and Line 2).
Specialist
Guarantees liquidity to its own banking bonds and certificates;
either the issuer or one of the banks participating in the placement process or holding an agreement with the issuer.
Broker
Only client originated activity;
Fee schedule based on instrument type.

8. Trading platform and connectivity

9. New MIT trading platform
As a part of LSE Group, starting from July, 21st EuroTLX runs the trading platform.
New trading platform ensure market members:
New funcionalities: circuit breakers management, improvement of closing prices;
High performance: latency reduction, reliability, data integrity and scalability;
Cost sharing: EuroTLX will share the technology infrastructure with other LSEG markets.
The complete documentation related to the new trading platform is available on the EuroTLX website and a specific team supports members for any IT query

10. How to connect to EuroTLX
Connectivity: already connected to EuroTLX market are the following Network Service Providers:
ALGOSPAN LTD; BIT Market Services; Bloomberg Finance LP; British Telecom PLC (BT RADIANZ); Fidessa PLC; FIXNETIX Limited; Interactive Data Europe Limited; Markerprizm BV; Morgan Stanley&CO International plc; Quanthouse SA; RTS Realtime System ltd; Sia SpA; Sungard Financial System France.
Connectivity to EuroTLX market –with related Network Service Provider- can be shared with connectivity other Borsa Italiana markets if already in place.
Certified ISV : the following ISV already offer a gateway certified for EuroTLX.
Trading GUI: EuroTLX is now able to provide the trading GUI to market members for a most flexible access to the market.

11. EuroTLX trading GUI

12. Trading

13. EuroTLX Market microstructure
• Order driven microstructure with the presence of at least one Liquidity Provider
on each traded financial instrument, that must quote continuously during
the trading session and must quote a minimum quantity;
• Central Limit Order Book with price & time priority, anonymous
and continuous;
• Trading hours: from 9:00am to 5:30 CET;
• Orders can be with price limit or without price limit
(either “market-to-limit” or “any price”);
• Market Rules focused on maintaining liquidity for market participants:
proprietary trading is forbidden for Brokers;
anti-gaming rules;
• Financial instruments, issued by a Liquidity Provider or by third parties, are admitted on the request by the LP that will support the liquidity on the market;
• Pre- & post-trade transparency;
• RFQ functionality will be introduced starting from Q

14. Listed instruments as of 30.09.2017
Market
Segment
Instrument
Number
Trading
Hours
Settlement
Banking Bonds non Eurobond
(Issued by a bank and placed through a banking network)
763
9.00 – 17.30
Eurocl/Clear/ MT-T2S
Other Bonds
Corporate bonds
Financial bonds
Emerging markets (MSCI Barra)
Supranational & Agency
ABS / Other debt instruments
1,812
9.00 – 17.30
Eurocl/Clear/ MT-T2S
Government Bonds UE
Sovereign
USA
623
9.00 – 17.30
Eurocl/Clear/ MT-T2S
Total fixed income securities
3,198
336
9.00 – 17.30
MT–T2S
International Equities
Cert-X
1,707
9.00 – 17.30
Eurocl/Clear/ MT-T2S

15. Post - trading

16. EuroTLX settlement set-up
Trades
Settlement instructions
Guaranteed by
1700
ISIN
Multilateral
netting
Bilateral
1177
ISINs
Bilateral Netting
Grouping of instructions
EuroTLX
Bilateral
X-TRM
Trade Router
Monte Titoli
Bilateral
1705
ISINs
Bilateral Single Instructions
Monte Titoli
160
ISINs
Guaranteed by
Multilateral Netting

17. Market Data

18. (Information-to-client)
Market Data
EuroTLX has two possible Market Data agreements:
Data Supply Agreement  Market participants
Data Distribution Agreement  Information Providers
All main Information Providers are connected to EuroTLX.
Market Data Product lines:
The EuroTLX Market Data service is provided:
- for all market segments;
- from the 1°level (Level 1) to full book (Level 2, A5);
- in “push” technology.
REAL TIME MARKET
DATA
STATIC
REFERENCE
DATA
STATIC
REFERENCE
DATA
FACT SHEETS
(Information-to-client)
Clear and simple description of
each traded financial instrument

19. EuroTLX data distribution model
Market Members
Professional
users;
Non-professional
Non display
usage;
Derived data
usage.
EuroTLX
Real time
and
Reference data feed
Data
Vendor
Data
Re-vendor
Pre trade transparency from 5 levels to full book and post trade transparency through three different information protocols: MITCH, GTP and GTP Lite.
EuroTLX real time market data is directly distributed to Market Members (waived fees for Market Makers) and major info-providers.
Billing is based on a subscription fee and on the reported usage on a quarterly basis (number of users, derived data and non-display applications).
Reference data is free for Market Members.
EuroTLX real time data feed gives a fully compliant pre e post trade transparency across the different services.

20. New initiatives: RFQ and new market segment

21. New Request For Quote functionality
New Request For Quote functionality will give to the EuroTLX members the possibility to send specific requests of prices to trade size larger than can be usually traded on EuroTLX order book.
EuroTLX set the minimum amount for sending the Request for Quotes. Request for sizes smaller than the set minimum amount won’t be allowed. Request For Quote new functionality will work only during the continuous phase of trading on EuroTLX order book.
New Functionality will offer to EuroTLX direct members the possibility to leverage the EuroTLX infrastructure also for efficiently trading large-in-scale orders.
New functionality will have some features in common with other LSEG fixed income exchanges.

22. RFQ Trading Process Requestor Market Makers Market Makers
RFQ for Instrument A
Market Makers
Quote Request sent to Instrument A’s market makers
Market Makers
Market Makers 1
Quote Response sent to accept the RFQ
Market Makers
Time
Market Makers 2
Requestor
Accepts a Quote
Market Makers
Trade at the best quote.
All market makers are notified of
the end of the negotiation process
Market Makers
Market Makers 3 4

23. RFQ Trading process 1
Direct market members can send a request of quotation sending an RFQ message to the Market Makers enabled to reply.
Market Makers enabled to reply can accept the request sending a quote, that can be updated during the negotiation timeframe;
Requestor can accept the proposals and trade will be executed at the best price.
Negotiation process will have a specific timeframe, after that all quotes sent will be automatically cancelled.
Anonymous
Named
RFQ will be sent to all the Market Makers enabled to reply.
Market maker’s response will be also anonymous.
Requestor has to choose the Market Makers which will receive the request.
Requestor can identify Market Makers replying to the request.
Market Makers’ replies will be anonymous between them. 2 3 4

24. RFQ on EuroTLX: main features
Requestor: both Brokers and Market Makers;
Market Makers enabled to reply: all Market Makers admitted on EuroTLX;
RFQ: anonymous or named:
Instruments coverage: all the fixed income intruments listed on EuroTLX excluding only Banking Bonds non Eurobonds;
Transparency: post-trade transparency only, on a real time basis;
RFQ timeframe: 60’’ for Govies and 90’’ for Other Bonds;
Minimum quantity: € turnover for Govies and € turnover for Other Bonds;
Settlement: at instrument level, same set-up of the order book;
Price validation: all details on the incoming Guide to Parameters.
Go live date: 14th November, 2016.

25. EuroTLX new market segment
Market Microstructure: only named RFQ will be supported, without any Market Makers’ obligation. Trading hours from 9:00am to 5:30pm CET.
Market Participants: Dealer to dealer with no differentiation between Liquidity Providers and Brokers, all the members will be able to send and reply to RFQs. EuroTLX members are automatically admitted. Membership to the new segment only will be allowed.
Instruments coverage: Instruments will be admitted on a market initiative only. EuroTLX will cooperate with Market Members to select the most interesting instruments to be admitted.
Settlement set-up: only bilateral settlement will be allowed, T2S or I-CSD (Euroclear/Clearsream).
Go live date: 2H 2017.

26. Price list Category RFQ New segment
No membership fee, trading fee only.
Trading fees on Other Bonds and New Segment will be discounted by 50% until October 2017.
Category
RFQ
New segment
Govies* & Sovereign
0,04 bps
0,15 bps
Other Bonds**
0,18 bps
0,55 bps
Requestor
Respondent
* Italian, European, UK and US Government Bonds.
** Other Bonds includes Corporate, Supranational Bonds, Emerging Market Bonds , Banking bonds non Eurobonds, ABS.

27. Fee schedule

28. EuroTLX pricing model
EuroTLX pricing model is a per-transaction model;
Fees are based on a Membership fee plus an Execution Fee per ticket traded;
Market Makers pay an Admission Fee according to the number of quoted financial instruments.
Membership Fee
Admission Fee
Trading right
Execution Fee
Market Maker A
(250 ISINs quoted min.)
100,000 €
0 €/year on IT Govies
180 €/year on Other Instruments
0.4 €/trade on IT Govies
1.0 €/trade on Other Instruments
Market Maker B – Line 1
(30 ISINs quoted min.)
25,000 €
120 €/year on IT Govies
250 €/year on Other Instruments
1.5 €/trade on IT Govies
2.5 €/trade on Other Instruments
Market Maker B – Line 2
-- €
0.4 bps/trade
Broker - Principal model
--** €
n/a
0.3 bps/trade on Govt. Bonds
0.7 bps/trade on Other Instruments
Broker - Agency model
15,000 €
0.8 €/trade on IT Govt. Bonds
1.3 €/trade on Other Instruments
Prop activity
Client activity
** A minimum activity of 1,500 €/month is required.

29. Ex –IT Government Bonds Ex –IT Government Bonds
Fee schedule: Broker
Agency
Membership
Execution
€ 15,000*
Italian Government Bonds
€ 0.80
Ex –IT Government Bonds
€ 1.30
Other Bonds
- Corporates
- Financials
- SAS & EM
Banking Bonds non Eurobonds, Certificates and Other debt securities
€ 1.50
Equities
€ 1.00
Principal Basis
Membership
Execution
---- **
Italian Government Bonds
0.3 bpts***
Ex –IT Government Bonds
0.3 bpts
Other Bonds
- Corporates
- Financials
- SAS & EM
0.7 bpts
Banking Bonds non Eurobonds, Certificates and Other debt securities
Equities
(*) Fee is not due in case the market participant is also a Specialist trading
exclusively its own banking bonds.
New Brokers are exempted from paying the Annual fee for the first six
months from their admission.
(**) A minimum monthly activity charge of € 1,500 is required.
(***) Basis point is equal to 1/10,000 of the traded countervalue in Euro. For each trade, minimum consideration is the execution fee of agency activity .

30. Fee schedule: Market Maker A
Admission*
Execution
Membership
Italian Govies
----
€ 0.40
€ 100,000**
Other Bonds
- Government Bonds
- Corporates
- Financials
- SAS & EM
€ 180*
€ 1.00***
Equities
€ 1.00
(*) The admission fee will be reduced to € 50 if the financial instruments is included in the «Flex» Package. The «Flex» package may include a maximum of 50 financial instruments. For each replacement a one-off fee of € 20 shall be applied (wih a maximun of 50 replacements in the same calendar year). Trading fee for financial instruments included in the “Flex” Package is 0.7 bpts, with a minimum consideration of € 2. It will enter into force in May 2016.
(**) Base fee for all financial instruments quoted by only one MM A. A discount of 10% on the membership fees is available for Market Makers that concluded at least 500,000 contracts in the previous year; a discount of 20% is available for Market Makers that concluded at least 1,000,000 contracts in the previous year.
(***) The execution fee will be reduced to € 0.40 after 200,000 executed trades on Non Italian Govies and will be reduced to € 0.50 on Corporate and Financial Bonds.

31. Fee schedule: Market Maker B Line 1
Admission
Execution
Membership
Italian Govies
€ 120
€ 1.50
€ 25,000
Other Bonds
- Government Bonds
- Corporates
- Financials
- SAS & EM
€ 250
€ 2.50
Equities
The Trading Rights for the first 30 financial instruments object of request of extension of the liquidity do not imply any fee for the first year.
The Admission fee applies to every financial instrument for which the admission on the market is required or for every financial instrument already listed on the market for which the liquidity obligations extension is asked by a Liquidity Provider.
The Admission fee will be reduced to € 50 if the financial instruments is included in the «Flex» Package. The «Flex» package may include a maximum of 50 financial instruments. For each replacement a one-off fee of € 20 shall be applied (wih a maximun of 50 replacements in the same calendar year). Trading fee for financial instruments included in the “Flex” Package is 1 bpts, with a minimum consideration of € 3. It will enter into force in May 2016.

32. Fee schedule: Market Maker B Line 2
Admission
Execution
Membership
Italian Govies
€ 120
0.4 bpts
€ ----
Other Bonds
- Government Bonds
- Corporates
- Financials
- SAS & EM
€ 250
Equities
5 bpts
The Trading Rights for the first 30 financial instruments object of request of extension of the liquidity do not imply any fee for the first year.
For each single executed contract, minimum consideration is € 1.50 for Italian govies and € 2.50 for all other financial instruments.
The “Admission” fee applies to every financial instrument for which the admission on the market is required or for every financial instrument already listed on the market for which the liquidity obligations extension is asked by a Liquidity Provider.
The Admission fee will be reduced to € 50 if the financial instruments is included in the «Flex» Package. The «Flex» package may include a maximum of 50 financial instruments. For each replacement a one-off fee of € 20 shall be applied (wih a maximun of 50 replacements in the same calendar year). Trading fee for financial instruments included in the “Flex” Package is 0.7 bpts, with a minimum consideration of € 2. It will enter into force in May 2016.

33. Fee schedule: Specialist
Admission
Execution
Membership
Other Bonds
€250* / € 600**
€ 2.00
€ 15,000
Banking Bonds non Eurobond
Certificates
€ 400**
Open-End Certificates
€ 160
* One-off trading rights for financial instruments with total issued amount below € 10 million.
** One-off trading rights for financial instruments with total issued amount equal to or higher than € 10 million.
For Specialists requiring the extension of liquidity requirements of at least 100 financial instruments, a discounted fee of € 25,000 will apply for maximum 100 securities. The discount is available only once per quarter.
For requests for admission and extension of the liquidity obligations that meet the requirements set out below, the Member shall benefit from a discounted fee of € 10,000. The application has to:
• be made by a Specialist already operating on EuroTLX as a Market Maker A; • contain at least 300 Banking Bonds non Eurobond or Other bonds already traded on one sole trading venue; • contain the master data of the instrument as required and agreed with the market; • be filed with a written undertaking to accept the timing of instruments admission as agreed between the parties; • be file with a written undertaking not to request the exclusion of providing liquidity on such financial instruments for a period of 3 years staring from the admission date.
This discounted fee may apply only once in the same year and for up to 600 financial instruments, whose admission has to be requested with the same unique request.

34. Market statistics

35. EuroTLX growth: trades and volumes
Year
Trades
Daily Avg
Turnover
2016
(-15,34% y-o-y)
9.160
€ bl (-16,70% y-o-y)
€ 259 ml
Q3 2017
(-4.32% y-o-y)
8.709
€42.884bl(-14.58% y-o-y)
€ 225 ml

36. Banking Bond non eurobond Other Bond & Other credit instruments
Market activity Q3 2017
Q3 2017
Instruments
Trad
Turnover (ml)
Average Ticket
Government Bond
623
421,612 € €
Banking Bond non eurobond
763
315,681 € €
Other Bond & Other credit instruments
1,812
489,930 € €
Equity
336
28,131
€ 238
€ 8.460
Cert-X
1707
408,018
€ 6.032
€14.784
TOTAL
5,241
1,663,372 € €

37. EuroTLX Mkt activity Q3 2017
EuroTLX positioning in Europe

38. Market share in Europe 2015
European Venues fixed income total trading activity on electronic Orderbook:
Source : FESE, Borsa Italiana,
EuroTLX, Deutsche Borse

39. European Team - Contacts
Luca Bagato Head of Sales & Business Development
Luigi Campa Head of Strategy & Bus.Development
Marco Bambace Sales
Francesca Carlomagno Sales
Erika Vallini Sales

40. Disclaimer
The information contained in this document and in the attachments is confidential and is intended for the exclusive use of the beneficiary. As a result, the contents of the present document shall not be disclosed without the prior written approval of EuroTLX SIM S.p.A. The present document is the exclusive property of EuroTLX SIM S.p.A. and is protected by Italian and international intellectual property laws. As a result, the contents of this document or any attachments cannot be modified in anyway, nor published, retransmitted, copied, sold, distributed or exhibited, nor can abstracts be created without the written approval of EuroTLX SIM S.p.A.
This document was drawn up by EuroTLX SIM S.p.A. exclusively for informational purposes. It can also contain advertising and promotional communications. Whoever uses it for other than purely information purposes or for commercial objectives assumes full responsibility for such use.
This document should not be construed as an offer, an invitation to offer or a promotional message for the purpose of purchase, sale or subscription in financial instruments or products of any nature.
Specifically, the present document does not represent consulting in investments, nor a recommendation, nor research into investment materials. Its purpose is not to recommend or suggest, explicitly or implicitly, an investment strategy as regards one or more financial instruments or issuers of such financial instruments. Copies of this document or parts thereof may not be transported, transmitted or distributed in the United States, Canada, Australia, and Japan or to any person resident in those countries or in other countries in which disclosure is only allowed subject to authorization by the competent authorities. Distribution of this document in other jurisdictions can be subject to restrictions and therefore, the persons who are meant to be beneficiaries of the document must be informed on the existence of these restrictions and abide by them.
The information contained in the present document is based on sources considered credible, however, no independent verification was made as regards to its veracity or accuracy. As a result, no guarantee or declaration, explicit or implicit, is provided nor can any reliance be placed on the precision, completeness or correctness of the information and opinions contained in this document. As regards the references to the physical aspects contained herein, it should be noted that the levels and taxation bases on which the present document is based are subject to changes and can affect the value of the investment.
Otherwise, the information contained in the present document represents opinions.
EuroTLX SIM S.p.A. is not responsible for any damage to the user and/or third parties due to the use of the information contained in the present document, including the possibility that there are errors, omissions or inaccuracies.
References made to the past performance of the financial instruments can in no way be construed as an indication of results promised by EuroTLX SIM S.p.A. or which may be expected, because investments in financial instruments are affected by multiple factors, related to the markets, issuers, and to regulatory, economic and political changes.
The Trademarks EuroTLX and TLX MPI are the property of EuroTLX SIM S.p.A.