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Eurex | Eurex Clearing
Growing volumes, our Partnership Program and reference rates: we spoke to Phil Simons, Head of FI Sales and OTC Business Development, about how the Fixed Income segment has developed in June and about the developments to come in the second half of the year.
Phil, from your perspective, how did June go?
I have to say, it went very well. June marks the halfway point of the year since the launch of our Partnership Program. Volumes are growing; we have achieved an ADV of EUR 67 billion compared to EUR 8 billion last year in June. Our market share in FRA is now well established at approximately 30 percent in June. This was a strategically important step for us as it demonstrates that Eurex Clearing can establish significant market share in OTC derivative products. This is now the foundation from which we will gain additional market share in OIS and long dated IRS, and it takes us into the next phase of the program in which we now focus on the buy side.
How does the listed side look?
On the listed side, I think we have seen a fundamental turnaround in the market place. After years of decreasing volatility, the continued political uncertainty and tapering of quantitative easing is supporting the market, and hence we have seen a significant uptick in our volumes. One example is the strong growth in our BTP futures and options that supports the market for both hedging and expressing views on European sovereign debt.
Looking ahead, what are your priorities in the second half of the year?
Besides continuing to grow our market share in the OTC market and further developing our Partnership Program, we are looking into the changes resulting from the replacements of Euribor and Eonia as well as other reference rates. The ECB is putting forward its own new unsecured rate (ESTER) based on reported euro deposits. Another candidate is the STOXX® GC Pooling EUR Deferred Funding Rate, a secured, centrally cleared, general collateral cash repo rate that we at Eurex strongly support as we think it has the highest proximity to a risk free rate (RFR). Hence we are looking at this in the context of launching futures contracts and are in the process of finalizing our short-term interest rate product strategy to complement our existing OTC and exchange traded derivatives product suite.