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50 Banks, Reuters Create Online Foreign Exchange

[London, ENGLAND] Fifty top banks and news agency Reuters announced Tuesday the creation of Atriax, a foreign exchange marketplace on the Internet for professional traders.

The founders of Atriax account for over half of all foreign exchange dealing in the world, where the market volume now exceeds US $1.5 trillion dollars a day.

An open, non-exclusive market that can be used by traders in addition to other platforms, Atriax will cater for online trading in over a hundred currencies and provide a fully automated confirmation and settlement process.

Input from Reuters will include real-time market data and news, while the banking partners in the venture will aggregate their research, indexing it for easy access.

The largest shareholders are The Chase Manhattan Bank, Citibank, Deutsche Bank and Reuters.

Operating globally as an independent business, Atriax will have its own board of directors and management team. A Bank Board consisting of 14 members will represent the interests of sell-side members; while an Advisory Board will represent the interests of buy-side members.

Sitting on the Advisory Board will be representatives of twenty-four global corporate and institutional names, including GE, Microsoft and Cisco.

Speaking for Cisco, Chief Financial Officer Larry Carter said his corporation is very supportive of this type of project, noting that an online marketplace for transacting foreign exchange was a "new world" approach to an age-old type of transaction.

"Not only does such a model offer increased transparency in price and execution, but it also offers the potential for straight-through-processing, by connecting banks directly to e-commerce engines like Cisco's," said Carter.

Dan Morehead, who was formerly chief financial officer of Tiger Management L.L.C. has been appointed as chief executive officer (designate) of Atriax. He commented that the aim was to establish it quickly as the most efficient means to research, transact and settle foreign exchange business.

"Atriax is open to all market participants and already a large number have come together from every part of the foreign exchange industry to develop a platform that will accrue substantial benefits to all," said Morehead.

Many of the much-touted online marketplaces that have sprung up in the last two or three years have not lived up to their promises. However, given the huge power of the participating bodies, Atriax could become very popular with traders.

The Euromoney May 2000 FX survey lists 32 currencies and currency pairs -- and of these, Atriax members hold two of the top three positions in every one.