Lmrkts, LLC, a fintech startup for banks to reduce financial exposure to each other, received an equity investment from International Finance Corporation (IFC), a member of the World Bank Group.
IFC joined lead-investor Motive Partners in this Series A round, whose amount was not disclosed.
The company will use the funds to expand in emerging markets beyond the New York Fed list of Primary Dealers and into other asset classes such as rates.
Founded in 2012 and led by CEO Lucio Biase, Lmrkts provides a compression service for commercial and investment banks to reduce exposure to each other thereby minimizing counterparty risk and leverage costs. The company balances participants’ counterparty limits and their unique risk management objectives with a structured methodology.
By reducing risk in local currencies and lowering the possible impact of one party’s failure on others, Lmrkts can foster liquidity and investment in emerging-markets countries.
After years of testing, the company launched in late 2016, and has to date compressed over US$2 trillion of notional equivalent in foreign exchange derivatives.