NEW YORK - The Wall Street dealers Bear, Stearns & Co., Credit Suisse First Boston, Lehman Brothers, and Salomon Smith Barney have teamed up to develop an online platform for trading mortgage- and asset-backed securities.
The joint venture will compete with start-ups such as Pedestal Inc., which provides similar services.
Online trading platforms are designed to enable banks and others to trade securities at a lower cost than traditional telephone- and fax-based trading.
The four Wall Street houses' platform will be up and running for dealer-to-dealer trading of Ginnie Mae, Fannie Mae, and Freddie Mac mortgage securities by the first quarter.
The platform will be expanded to allow trading by institutional investors and will add the full range of mortgage- and asset-backed securities at the same time "at some point not long after," a spokesman for Salomon Smith Barney said.