Libor Lurch
The validity of the London Interbank Offered Rate (LIBOR), to which hundreds of trillions of dollars in loans are pegged around the world, is being investigated by the British Bankers’ Association after several banks complained about the way prices are set. Specifically, they charge that some banks were low-balling the rates they pay to avoid speculation they were in a liquidity crunch. Rates leapt after the investigation was announced.
LME Going American
The London Metal Exchange, which recently launched European and Asian steel futures contracts, says it’s now aiming to launch a contract for the Americas by year-end, with steel warehouses across the southern United States. The location is key, because steel generally flows from Latin America to North America, and locating the warehouses near producers would be too easy to dump.
ISE and TSEC sign MOU
In an effort to establish further cooperation between Taiwan and U.S. exchanges, the Taiwan Stock Exchange Corporation (TSEC) and the International Securities Exchange (ISE) signed a Memorandum of Understanding (MOU) on May 5. The MOU allows for the expansion of Taiwan-related ETFs, which may be added later this year for trading on ISE’s options and stock exchanges. ISE currently lists three ETFs/indexes based on Taiwanese companies for options trading. “Access to markets in Taiwan is more open after signing the MOU,” says a TSEC spokesperson.
TSE picks Liffe Connect
Tokyo Stock Exchange (TSE) is enhancing its options trading capabilities with the start of a new options trading system using NYSE Euronext’s Liffe Connect technology. The system, Tdex+, will launch in early 2009. “NYSE Euronext’s technical and operational expertise in various markets, such as the capital and derivatives markets, is of indispensable value to us,” said Atsushi Saito, president and CEO of TSE, in a statement.
RCG and GAIN strike deal
Rosenthal Collins Group (RCG) and GAIN Capital are teaming up to establish operations in the United Kingdom with the launch of a forex and futures trading venture there. RCG GAIN Limited, GAIN’s first foray into the UK and European Union, will offer online trading capabilities in forex and futures. RCG President Maureen Downs says more specific product details will be available when the RCG GAIN Limited Web site launches at the end of the second quarter. The two groups intend to expand the service into the rest of the EU. A GAIN spokesperson says the joint venture’s FSA authorization will permit RCG GAIN Limited to passport its services under MiFID throughout Europe.
“London offers a well-developed regulatory regime, which promotes transparency and customer protection. We’ve seen an increasingly larger appetite globally for access to U.S. products, and we look forward to the opportunity to serve clients there,” Downs says. GAIN CEO Glenn Stevens says, “Working in unison with RCG will help GAIN accelerate its expansion plans, in both the United Kingdom and across the European Union.”
