A seminar at FOW's recent event in Frankfurt highlighted the competitive differences in clearing services between European and US financial markets. FO Week followed up the issues raised by asking some of the major players between the continents about them, and about the clearing landscape in general. Elliott Aykroyd reports.
The topic which dominated the seminar was the idea of a
united European clearing environment and whether this would
enable the continent to compete more effectively with the US -
one of the main barriers to this being the need to clear across
borders. Volker Potthoff, md banking and custody services for
Clearstream, introduced the issue, saying, "Trading is pretty
efficient [but the] regulatory issues now surround clearing and
settlement. Europe is ahead of the US in terms of trading but
The European regulatory environment must be compared with the
situation in the US, where there is just one jurisdiction and
only two major regulatory bodies covering derivatives, arguably
an easier setup in which effectively to clear business. Kim
Taylor, md and president of clearing at Chicago Mercantile
Exchange (CME), told FO Week that the situation in the US is
largely "friendly." However, turf wars between Commodity
Futures Trading Commission (CFTC) and Securities and Exchange
Commission (SEC) still occasionally break out.
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