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Brazil's BM&F Joins GLOBEX® Alliance With CME, Paris Bourse, SIMEX

Date 10/09/1999

Brazil's BM&F, the Bolsa de Mercadorias & Futuros, has joined the GLOBEX® Alliance with the Chicago Mercantile Exchange (CME), Paris Bourse and the Singapore International Monetary Exchange (SIMEX), officials of the four exchanges announced today at a futures industry meeting here. Separately, the exchanges announced that BM&F will use the same NSC Electronic Trading System developed by Paris Bourse and used by all of the GLOBEX Alliance partners. The addition of BM&F-South America's largest futures and options exchange and the world's fifth largest- to the GLOBEX Alliance will create a global trading link providing access to many of the world's most popular financial futures products on a single electronic trading platform. The GLOBEX Alliance spans three of the world's major time zones. Under the GLOBEX Alliance, members of each exchange will benefit from a direct access to all the products of all the markets inside the Alliance through one single technical access, and receive trading privileges for the electronically traded products of the other exchanges, along with cross margining of positions in order to reduce the capital requirements of their customers and members. In addition, the Alliance partners are establishing a harmonized set of electronic trading rules and policies. "The addition of BM&F to the GLOBEX Alliance further expands the product range and significantly increases the critical mass of this global trading partnership," CME Chairman Scott Gordon said. "The fundamental principles underlying the GLOBEX Alliance - providing trading and capital efficiencies to customers - are proving enormously successful." "BM&F welcomes the open market opportunities that joining this international alliance will provide," said Manoel Félix Cintra, Chairman of BM&F. "The GLOBEX Alliance, along with recently announced changes in Brazilian central bank regulations, will make it possible for BM&F to participate much more fully in the globalization of risk management." "The NSC trading system developed by the Paris Bourse is clearly the system of choice among exchanges around the world," Paris Bourse Chairman and CEO Jean-François Théodore said. "The openness and flexibility of NSC will benefit each exchange as the Alliance expands to include more members worldwide. The new challenge is to fastly implement the interconnection in order to reduce the technical access costs of the market participants. " "SIMEX is very pleased to welcome BM&F into the GLOBEX Alliance," Victor Liew, Chairman of SIMEX, said. "Now, from the Pacific Rim to South America, futures and options products will be accessible around the clock from a single screen." The GLOBEX Alliance uses the NSC trading platform, developed by Paris Bourse and used by 14 exchanges worldwide, including the CME 's GLOBEX2, introduced in September 1998. Each GLOBEX Alliance exchange will connect to the central trading system via a common Application Programming Interface (API), the Hub API, being jointly developed by the GLOBEX Alliance exchanges. The three founders of the GLOBEX Alliance also announced that they have progressed on two major steps in achieving a globally linked trading network : A fully interconnected test platform linking linking the original three GLOBEX Alliance exchanges will be in place by mid-December 1999. The exchanges are working toward a launch of the production system early next year. A cross membership agreement between Paris Bourse and SIMEX is ready for signature, subject to approval of their respective regulatory authorities. Similar cross-exchange access agreements already exist between the CME and the Paris Bourse, as well as between the CME and SIMEX. The CME trades futures and options on agricultural commodities, foreign currencies, interest rates and stock indexes. BM&F trades futures and options on interest rates, exchange rates, stock indexes and agricultural commodities. Paris Bourse trades futures and options on interest rates, commodities, stocks and stock indexes. SIMEX trades futures and options on interest rates, stock indexes and energy.