The New York branch of the Bank of China will become a clearing settlement bank and collateral custodian of CME Group, subject to regulatory approval.
Bank of China is one of China’s Big Four state-owned banks. Chicago-based CME Group is a “derivatives marketplace” that specializes in managing risk.
With the addition of Bank of China’s New York branch, CME Group's customers will have an even more diverse list of approved settlement banks to choose from.
"This successful collaboration with CME Group is a great milestone in the development of the relationship between our two companies and also demonstrates the bank's emergence as a global financial leader by providing comprehensive services in the commodities futures business to customers globally," said Xu Chen, General Manager, Corporate Banking Unit (Financial Institutions), Bank of China.
Kim Taylor, President, CME Clearing, said the company is pleased to expand its global reach with Bank of China, New York branch as its partner because this offers clearing member firms alternative options to fulfill collateral obligations and daily settlements at CME Clearing.
In March 2012, CME Group and BOC signed a Memorandum of Understanding that confirmed both organizations' intent to explore and potentially collaborate in the areas of clearing membership, banking settlement, offshore RMB depository and cross-border futures business in the U.S. and China.
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