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CME Group to close CME Europe, CME Clearing Europe by end of year

CME Group intends to close its derivatives exchange CME Europe and clearinghouse CME Clearing Europe, both based in London, by the end of the year.

CME Group said in an announcement Wednesday that it will work with market participants and regulators to “ensure a smooth transition and an orderly wind-down of business operations.” This includes providing CME Group market alternatives for actively traded products on CME Europe.

“While Europe continues to be a critically important and expanding market for CME Group, with average volumes of more than 2.6 million contracts per day from European clients during 2016, our customers have shown that they prefer to access our global products, deep liquidity and greater capital efficiencies through our U.S. infrastructure,” said William Knottenbelt, CME Group senior managing director, international, in the announcement.

Mr. Knottenbelt said despite the “business decision” to close the London-based entities, “we will continue to maintain a significant operation in London to execute our global growth strategy, including serving our European client base, developing innovative products and services, and helping customers effectively manage their risk across every major asset class.”

CME Group offers a range of global benchmark products across asset classes including futures and options based on interest rates, equity indexes, foreign exchange, energy, agricultural products and metals. It provides electronic trading globally via its CME Globex platform, and clearing and settlement services across asset classes for exchange-traded and over-the-counter derivatives through its clearing houses, CME Clearing and the soon to be closed CME Clearing Europe.

A spokeswoman for CME Group in London said of the 400 employees in the U.K., a low, single-digit percentage will be affected.