Future Exchanges: Sorry Liffe, says DTB
Euromoney, is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024
Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement
BANKING

Future Exchanges: Sorry Liffe, says DTB

Having so long been the whipping-boy of its big cousin in London, the German futures exchange (Deutsche Terminbörse - DTB) can be forgiven for taking a full-page advertisement in the Financial Times in March to trumpet its victory.

After eight years of struggle the DTB had taken close to 70% of volume in the 10-year German Bund future, from the London International Financial Futures & Options Exchange (Liffe) which had dominated that contract since they both began competing in November 1990.

"Sorry Liffe, we did not want to become part of your problem, we prefer to be part of a solution," ran the advertisement with the heavy humour characteristic of Deutsche Börse executive board member Jörg Franke.

Since March the floodgates have opened and the DTB's share of the Bund contract has reached over 80%.

Even before this slap in the face, Liffe's strategy for next year and beyond, when the long-term and short-term euro-denominated contracts are up for grabs, had seemed to be on the ropes. The reason for its disarray was complacency bred by 16 years of phenomenal success. Why change a formula that was enriching Liffe executives and its members year after year? Liffe's mutual membership structure excludes non-shareholders from membership of the exchange, and has acted as a brake on evolution.

Gift this article