CME’s CCP gains ESMA’s approval
27 June 2016 Chicago
Image: Shutterstock
The European Securities and Markets Authority (ESMA) has given its approval to the Chicago Mercantile Exchange (CME) to operate in the EU as central counterparty (CCP).
Since receiving the approval earlier in the month, CME Clearing has launched a physically-delivered EU wheat futures and options on futures contracts, which will begin trading on 12 September.
According to CME Clearing, EU wheat futures and options, known as ‘Soft Red Winter’ and ‘Hard Red Winter’, will be denominated in euro, priced relative to the Rouen market in France, and will enable users to take delivery of wheat at exchange-approved warehouses in key locations across France, or hold onto wheat certificates for delivery at a future date.
The approval of CME Clearing is the latest development in an ongoing drive to develop the central clearing industry in Europe since finalising a EU/US CCP equivalency agreement in March.
In a speech at the Banque de France last week, Steven Maijoor, chair of ESMA, emphasised the regulator’s view on the importance of CCPs, stating: “CCPs are systemically critical infrastructures for financial stability, and supervision must ensure CCPs’ resilience in extreme but plausible scenarios.”
EMSA has also focused on native CCPs by conducting stress tests on all EU clearinghouses, which largely proved that they could successfully manage in market stress scenarios.
CME Group executive chair and president Terry Duffy said: "Central clearing is a critical component of the G20 commitments, which increases transparency, reduces systemic risk and strengthens the financial system.”
In a speech at the Banque de France last week, Steven Maijoor, chair of ESMA, emphasised the regulator’s view on the importance of CCPs, stating: “CCPs are systemically critical infrastructures for financial stability, and supervision must ensure CCPs’ resilience in extreme but plausible scenarios.”
EMSA has also focused on native CCPs by conducting stress tests on all EU clearinghouses, which largely proved that they could successfully manage in market stress scenarios.
CME Group executive chair and president Terry Duffy said: "Central clearing is a critical component of the G20 commitments, which increases transparency, reduces systemic risk and strengthens the financial system.”
Since receiving the approval earlier in the month, CME Clearing has launched a physically-delivered EU wheat futures and options on futures contracts, which will begin trading on 12 September.
According to CME Clearing, EU wheat futures and options, known as ‘Soft Red Winter’ and ‘Hard Red Winter’, will be denominated in euro, priced relative to the Rouen market in France, and will enable users to take delivery of wheat at exchange-approved warehouses in key locations across France, or hold onto wheat certificates for delivery at a future date.
The approval of CME Clearing is the latest development in an ongoing drive to develop the central clearing industry in Europe since finalising a EU/US CCP equivalency agreement in March.
In a speech at the Banque de France last week, Steven Maijoor, chair of ESMA, emphasised the regulator’s view on the importance of CCPs, stating: “CCPs are systemically critical infrastructures for financial stability, and supervision must ensure CCPs’ resilience in extreme but plausible scenarios.”
EMSA has also focused on native CCPs by conducting stress tests on all EU clearinghouses, which largely proved that they could successfully manage in market stress scenarios.
CME Group executive chair and president Terry Duffy said: "Central clearing is a critical component of the G20 commitments, which increases transparency, reduces systemic risk and strengthens the financial system.”
In a speech at the Banque de France last week, Steven Maijoor, chair of ESMA, emphasised the regulator’s view on the importance of CCPs, stating: “CCPs are systemically critical infrastructures for financial stability, and supervision must ensure CCPs’ resilience in extreme but plausible scenarios.”
EMSA has also focused on native CCPs by conducting stress tests on all EU clearinghouses, which largely proved that they could successfully manage in market stress scenarios.
CME Group executive chair and president Terry Duffy said: "Central clearing is a critical component of the G20 commitments, which increases transparency, reduces systemic risk and strengthens the financial system.”
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