CME Group (CME) Looks to Set News Records as Chinese Currency Now Accepted as Collateral
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Overall Analyst Rating:
NEUTRAL (
Up)Dividend Yield: 2.9%
EPS Growth %: -82.3%
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On December 5th, CME Group (NYSE: CME) reported it has, for the fourth consecutive month, set a new record for clearing interest rate swaps (IRS) and credit default swaps (CDS).
For the month of November, the company cleared $61.9 billion in combined OTC IRS and CDS volume, a 36 percent increase over the previous record monthly total of $45.5 billion set in October 2011. Year to date, the company has cleared more than $153 billion in OTC IRS and CDS through its multi-asset class clearing solution since launch.
In an effort to continue to set records, management at CME has now decided to accept the Chinese currency traded in the offshore market, also known as CNH, as collateral on all its exchange-traded futures products.
The WSJ reports CME Group and HSBC (NYSE: HSB) has developed the operational framework allowing its Hong Kong bank to hold CNH deposits from CME customers. This decision is another move to expand the company's business focus and presence in China. In August, CME introduced dollar-yuan futures for its investors.
Currently, 22 percent of all CME Group's volume is originated outside the U.S, but with total yuan deposits in Hong Kong banks growing to over 600 billion yuan in October management is trying to expand the reach of its own hand.
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For the month of November, the company cleared $61.9 billion in combined OTC IRS and CDS volume, a 36 percent increase over the previous record monthly total of $45.5 billion set in October 2011. Year to date, the company has cleared more than $153 billion in OTC IRS and CDS through its multi-asset class clearing solution since launch.
In an effort to continue to set records, management at CME has now decided to accept the Chinese currency traded in the offshore market, also known as CNH, as collateral on all its exchange-traded futures products.
The WSJ reports CME Group and HSBC (NYSE: HSB) has developed the operational framework allowing its Hong Kong bank to hold CNH deposits from CME customers. This decision is another move to expand the company's business focus and presence in China. In August, CME introduced dollar-yuan futures for its investors.
Currently, 22 percent of all CME Group's volume is originated outside the U.S, but with total yuan deposits in Hong Kong banks growing to over 600 billion yuan in October management is trying to expand the reach of its own hand.
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