Deutsche Boerse AG, owner of the Frankfurt stock exchange and the Eurex futures market, is considering opening a clearinghouse in Asia, according to two people familiar with the situation.
The exchange may seek to work with a partner or set up the clearing venue on its own and hasn’t yet decided how to proceed, said the people, who asked not to be identified as the plans are private. While the proposals are at an early stage, Singapore is a possible location for the clearinghouse if construction goes ahead, the people said. Frank Herkenhoff, a spokesman for Deutsche Boerse in Frankfurt, declined to comment.
The Frankfurt-based company is focused on expanding in Asia after European regulators blocked its purchase of NYSE Euronext last year. Deutsche Boerse said yesterday that its Clearstream settlement unit will work on a joint collateral-management service with Singapore Exchange Ltd.
New regulations are pushing more transactions through clearinghouses for processing, in a bid to cut financial risk. The venues operate as central counterparties for every buy and sell order executed by their members, who post collateral, reducing the threat from a trader defaulting.
Singapore Exchange and Korea Exchange Inc. said in March they’re exploring joint trade-processing projects for over-the-counter financial derivatives. KRX is also looking at OTC clearing opportunities with Hong Kong Exchanges & Clearing Ltd., and Japan Exchange Group Inc. is seeking to expand its post-trade operations.
The Financial Times reported Deutsche Boerse’s plans earlier today.