CME Group applies for London based derivatives exchange

CME Group has announced it will be sending an application to the cme-group-bigUnited Kingdom’s Financial Services Authority (FSA) to create a derivatives exchange based in London. If approved, CME Europe Ltd will begin trading foreign exchange futures products initially, and is expected to launch in mid 2013.

CME Group is known as the worlds leading and most diverse derivatives marketplace. The company serves the risk management needs of its customers from all around the world, providing a wide range of benchmark futures and options products, covering all major asset classes. CME Group also operates CME Clearing, which is one of the leading central counterparty clearing providers in the world, offering clearing and settlement services and processing more than one billion trades every year, worth more than $1,000 trillion.

Terry Duffy, Chairman and President of CME Group said of the UK application:

“We continue to see an increase in business coming from our diverse set of customers in Europe, with more than 20 percent of our volume now originating from the region.  Having an exchange in London that can leverage the central counterparty model of CME Clearing Europe will allow us to align ourselves even more closely with our regional customers in both listed futures and over-the-counter markets, and provide additional opportunities to our expanding non-U.S. customer base.”

CME Group Chief Executive Officer Phupinder Gill also said that the new application for a UK based exchange fits in with their strategy to grow and meet regional demand:

“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.”

The current Managing Director, Robert Ray, will become Chief Executive Officer 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.