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Tuesday, July 31, 2001

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SSI sets eyes on ECN solution market

By Our Special Correspondent

CHENNAI, JULY 30. SSI Technologies, a division of SSI, is set to deliver Volbroker, a consortium of investment banker based in London, a software solution for equity derivative trading.

Ideally, this will facilitate matching of trades by members of Volbroker through ECN (electronic communication network).

ECN is gaining currency in Europe. Large member/brokerage houses with their clients spread across the globe use ECN to match trades. The `matched trades' are subsequently reported to the exchange.

Well-known investment firms like Deutsche Bank, Goldman Sachs, JP Morgan are among the Volbroker consortium.

According to Mr. P. K. Seshadrinathan, chief technology officer, the Volbroker contract is worth $3 million for SSI Technology. Close to 45 personnel are working on the project. The company is hopeful of delivering the solution to Volbroker by October. Volbroker can take the ECN solution live by the first quarter of next year.

The CTO is optimistic that the ECN market - though insignificant at the moment - can prove a big boon for SSI if properly tapped. Nevertheless, the chief officer has made it clear that his company will operate in both the stock as well ECN markets. In this context, he points to the development of a refined TESA - the electronic securities architecture - by SSI Tech for Indigo Markets, a joint venture between Nasdaq and SSI. The improvised TESA will address the different functionalities of Nasdaq Japan. While providing trading solution to Nasdaq Japan, SSI Technolgoy will also help in facilitating broker interface with FIX (financial information exchange). The SSI-developed solution will be tested by members before being put online. The solution being provided by SSI will support a hybrid system which is both order as well quote-driven (where investors give buy and sell orders). A quote-driven market will lend greater liquidity for all listed stocks as compared to order-driven markets.

With software education lacking lustre in the wake of U.S. economy slow down, SSI Technology is expected to be a big revenue contributor for SSI.

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