Five of Wall Street's biggest banks have announced they are setting up a system to trade privately placed stocks.

The Open Platform for Unregistered Securities, or OPUS-5, will be designed to ease trading for privately sold securities in the 144A equities market. It will target companies looking to raise capital while avoiding the scrutiny and rules imposed on publicly listed shares.

The group of five comprises four of the world’s leading securities firms – Citigroup, Lehman Brothers, Merrill Lynch and Morgan Stanley – together with, as independent administrator, the Bank of New York Mellon.

OPUS-5, which is expected to launch in September 2007, will also offer an alternative to proprietary platforms introduced separately by Goldman Sachs and JPMorgan. Goldman launched its Goldman Sachs Tradable Unregistered Equity system, or GSTrUE, in May. The JPMorgan platform is dubbed "144A Plus”.

Under Rule 144A, securities issuers need not register as a public company as long as they have fewer than 500 qualified institutional investors. Qualified investors generally have at least $100 million of discretionary assets and are typically pension funds, mutual funds, hedge funds and other institutions.