Granting London Metal Exchange membership to a Bank of China Ltd. (3988) unit would spur trading activity from customers in the Asian country, according to the head of the subsidiary.
Following are comments on LME membership from Arthur Fan, chief executive officer of BOCI Global Commodities (U.K.) Ltd., which applied this week for LME membership. Fan spoke yesterday by phone from London. BOCI Global Commodities is a unit of Bank of China’s BOC International Holdings Ltd. arm.
Chinese customers account for more than 50 percent of LME trading, Fan said.
“We expect to bring positive impact on both Chinese customers and LME. There will be more volume.
“Once we become a member of the LME, we will be able to provide a complete hedging solution to the Chinese customers. Our parent company already has a very close business relationship with Chinese natural-resources customers. There is a huge demand for commodities in China.
“It is a natural development for Chinese investment banks or brokers to establish an LME business. Chinese investment banks are really trying to catch up and grow aggressively in the past few years.”
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