CME Group is applying to the U.K.’s Financial Services Authority (FSA) to create a London-based derivatives exchange for foreign exchange futures products, with an expected launch of mid-2013.
More than 20% of CME Groups volumes originate from Europe, the groups executive chairman and president, Terry Duffy, says. Having a London-based exchange that could leverage the central counterparty model of CME Clearing Europe, its OTC derivatives CCP, would help the align the group more closely with regional customers in futures and OTC markets along with expanding its non-U.S. customer base, he adds.
Robert Ray, who is currently managing director for Products and Services at CME Group, will become CEO of CME Europe. CME Globex will be used as the electronic trading platform, and CME Clearing Europe Ltd, which launched in May 2011, will provide central counterparty clearing services.
CME Groups application to establish an exchange in Europe is part of its strategy to grow organically, CME Group CEO Phupinder Gill says. “Launching with a suite of FX products allows us to leverage our 40 years of experience in FX futures for customers in the region who access the futures market during the London business day, but we also plan to look at expanding into additional asset classes, Gill says.
(CG)