AsiaClear, the central counterparty of Singapore Exchange, has decided to forgo over-the-counter US dollar rate-swaps clearing because of a lack of demand by members. "They usually prefer to clear at LCH.Clearnet, rather than to split the margin and netting that LCH gives them by also clearing dollar swaps at SGX," said Frederick Shen, Oversea-Chinese Banking's head of global treasury.
Magnus Bocker, CEO of Singapore Exchange for more than five years, plans to leave in June, when his contract expires. Bocker has overseen the exchange's expansion in Asia. "There is a time and season for everything, and it is now time for me to take on new challenges," he said. SGX has hired an executive-search firm to find a successor.
IntercontinentalExchange has added two iron-ore swaps-futures contracts. Many traders say ICE has a long way to go to be competitive with Singapore Exchange, which handles more than 90% of the world's capacity in this market.
Singapore Exchange has joined discussions started by London Stock Exchange Group to purchase a stake in LCH.Clearnet Group, sources say. SGX declined to comment on the subject. "As the Asian Gateway, SGX is open to partnerships and alliances for the benefit of shareholders, the company and our customers," spokeswoman Carolyn Lim wrote in an e-mail. "However, we do not comment on media reports or speculation."
Australian officials are unlikely to go for the latest deal offered by Singapore Exchange to acquire ASX because concerns remain about ownership and whether the merger would benefit Australia. SGX offered to eliminate a 15% cap on shareholdings to sweeten an $8 billion deal, but "the requirement for ASX/SGX to prove that the merger is proactively in the national interest is still unproven, and this latest announcement does little to address that political concern," one analyst said.