Eurex moves to cut settlement fees as CCP savings kick in

Eurex moves to cut settlement fees as CCP savings kick in

After moving to slash settlement fees for Dutch stocks, Eurex Clearing is reducing charges for equities transactions in Xetra and on the floor of the Frankfurt Stock Exchange by as much as eight per cent.

Beginning in January 2004, the fee reduction is valid for all transactions that run through the central counterparty (CCP) and are settled after netting.

The new fee structure will be based on a six-step price scale ranging between 0.55 and 0.45 euros per transaction; up to now, there were four steps ranging between 0.58 and 0.49 euros.

Eurex Clearing claims it is now the cheapest provider compared with European competitors.

Rudolf Ferscha, Eurex CEO, says: "We are passing efficiency gains on to our customers and thus supporting growth in the industry as a whole. We want to attract groups of participants and trading strategies that are futures-typical, and thus further enhance turnover and market quality."

He says the price reduction is made possible by the high acceptance for the central counterparty in equities trading, which was introduced in March 2003. Less than five per cent of all transactions actually need to be settled after netting through the CCP.

Ferscha adds that liquidity on Xetra has risen 27 per cent since the introduction of the CCP, equating to EUR20 million in lower trading costs per month.

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