LME announces departure of Scotiabank, China Merchants Securities
- Several banks in recent years have closed commodities businesses, hit by higher capital requirements.
- The LME, owned by Hong Kong Exchanges and Clearing Ltd. , said both had also withdrawn as members of its clearing arm, LME Clear.
LONDON: The London Metal Exchange (LME) said on Tuesday it lost two members - Scotiabank Europe Plc and China Merchants Securities (UK) Limited - groups that last year had shut metals operations.
Several banks in recent years have closed commodities businesses, hit by higher capital requirements, heightened government regulation and weaker revenues in the sector.
The exchange, the world's oldest and largest market for industrial metals, said in a statement it had accepted the resignations of the two, effective immediately.
The LME, owned by Hong Kong Exchanges and Clearing Ltd. , said both had also withdrawn as members of its clearing arm, LME Clear.
Last October a letter seen by Reuters said the British arm of China Merchants Securities would close its commodities brokerage after a review of the business that aimed to align it with the group's global strategy.
Scotiabank also decided last year to close its metals business, which was until a few years ago one of the biggest names in precious metals, with a history stretching back to the 17th century.
Both were Category 2 LME members, which are allowed to trade exchange contracts on the exchange's electronic system and on the telephone, but not in the open outcry ring, which is closed due to COVID-19 restrictions.
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