The Chicago Mercantile Exchange's proposed merger with the Chicago Board of Trade will help the new derivatives group better compete against foreign rivals, according to a news release from the CME.
"The CME-CBOT merger increases competition in the global derivatives marketplace and better positions the U.S. to compete against rapidly growing international exchanges, dealers and platforms in the over-the-counter markets and national securities exchanges that are continuing to enter U.S. futures markets," the release. said.
The release was in response to a statement by the Futures Industry Association issued last week cautioning that "the CME-CBOT merger would ... substantially lessen competition among U.S. futures exchanges, and raise even higher the barriers to entry for new competitors."
The FIA statement was made at the request of industry participants and differed from comments made by FIA President John Damgard, who said "consolidation usually leads to greater efficiencies" when the merger was announcedin October.
The merger of the two leading Chicago futures markets is expected to result in operational savings of $125 million a year and cost savings for customers of $70 million a year.