Select Committee on Treasury Minutes of Evidence



Examination of Witnesses (Questions 140-145)

MRS CLARA FURSE, MR MARTIN WHEATLEY AND MR JONATHAN HOWELL

TUESDAY 22 JANUARY 2002

  140. For you?
  (Mrs Furse) For our customers large amounts of money.

  141. Yes.
  (Mrs Furse) For us rather less money.

  142. Do you think this is an area—I am talking here about the consolidation of the settlement systems—which should be left entirely to market forces or where some—I am going to use the term political initiative, you will understand the sense in which I am using it—political initiative would be desirable?
  (Mrs Furse) I am not sure we can rely on market forces. Martin, do you want to comment?
  (Mr Wheatley) Yes. We have been very disappointed, if I am honest, by the market forces having the effect that they should be able to have. The major players in the industry have a lot of customer buying power. They see a situation in clearing and settlement which is going against what they wish to see yet to date, at least, until one or two recent initiatives, have not shown themselves able to muster the necessary will to change that. We have been using our lobbying powers to bring "political" forces to bear on this because I do not think market forces are having the desired effect.

  143. Of course you will recognise that the merger of LIFFE and Euronext makes them a very important single player in the future development of settlement systems?
  (Mr Wheatley) Yes.

Chairman

  144. We are nearly there. I asked Sir Brian and Jean-François at the end of the last session about their ambitions and the rationale for the merger. They told me—and I know you were in the room—that they wanted to become the dominant player in Europe rivalling Eurex. So we can take it from your evidence this morning that your ambition is still one to be dominant in Europe whether that is in shares, in equities, which you are at the moment, or whether it is in derivatives. You see potential for great growth in both of those areas. This will be influencing your strategy towards the global ambitions which you have. You mentioned that you would be leading the consolidation of the global stock exchanges, that will continue. Lastly, you wish still to get into the trading of derivatives, either by setting up your own operation or by taking over an existing derivatives operation. Would that be a summing up of your position?
  (Mrs Furse) Thank you, Chairman.

  145. Thank you.
  (Mrs Furse) Thank you very much.



 
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