GOVERNMENT BOND BROKER SEES WIDER DATA ACCESS
The major U.S. Government bond brokers
are likely to give in to pressure from regulators and investors
within the next 18 months, making their direct-dealing screens
available to many of those firms that are not now eligible to
receive them, said Richard Lacy, Chairman of Exco International
Inc.
    Earlier today, Exco said it purchased an 80 pct interest in
RMJ Holdings Corp, one of the largest of the four bond brokers
that dominate the business.
    In a telephone interview, Lacy said "Within 18 months, we
think the number of players will be expanded."
    Currently, the four major brokers will sell their
direct-dealing screens to only primary dealers in U.S.
Government securities or those that have applied to the Federal
Reserve Bank of New york to become a primary dealer.
    The U.S. Justice department is looking into whether
limiting access to the screens to just a small group of dealers
is a violation of U.S. Anti-trust laws.
    Primary dealers, of which there are now 40, are an elite
group of firms approved to buy Treasury securities directly
from the Fed.
    But Lacy said that any agreement to expand access to the
brokers' direct-dealing screens is likely to be not as
far-reaching as some would like. Instead of making screens
available to any firm willing to pay for one, he said, it is
more likely that a "second tier" will be established.
    He also said that RMJ is not willing to break away from the
group of bond brokers and be the only firm to make its screens
widely available to any one who wants them.
    Bond market sources had speculated that RMJ is better
prepared to offer its services nationwide than its three major
competitors.
    Lacy also said that he does not see any immediate pressure
for a further cut in commissions paid on bond transactions any
time soon. In late 1985, transaction fees paid to brokers were
cut in half to 39 dlrs per mln dlr transaction from 78 dlrs.
    Some U.S. primary bond dealers have been suggesting that
with further increases in transaction volume, fees can be cut
without hurting the brokers' profits.
 REUTER
