Multi-asset clearing and brokerage firm Newedge has submitted plans for a project that aims to separate financial futures and options execution and clearing into two distinct entities to the European Works Council in France.
This project intends to bolster the firms position in the new market and global regulatory framework, both through a clearing platform for major derivatives asset classes as well as through multi-asset class execution capabilities, offering access to wide liquidity pools.
The project also aims to simplify business activities and geographical footprint, with a focus on its existing core strengths, streamline the firms operational model to enhance process efficiency, risk management and cost control.
The listed derivatives industry is at a turning point, said Nicolas Breteau, CEO of Newedge. The pace and significance of change driven by regulation, economic and market headwinds, and developing client needs is set to continue.
The plan presented today follows a strategic review of our business and is a measured, informed response to the challenges facing the industry. It will create a firm that is leaner, more agile and client-centric, and will set the foundations for a sustainable future. We are entering the next chapter in Newedges development, and can see emerging from the current challenges great potential for growth, in such areas as OTC clearing.
Crdit Agricole Corporate and Investment Bank and Societe Generale, Newedges joint shareholders, have endorsed the strategy proposed by Newedge management.
The plan is subject to a number of conditions including information and/or consultation of local employee representative bodies and the customary approval of regulators. Pending approval by the Works Council, Newedge expects to implement the project in 18-24 months.
(JDC)