Natixis Commodity Markets Ltd., one of 12 companies allowed to trade on the floor of the London Metal Exchange, may remain a member of the bourse after the bank’s decision to close the commodity brokerage business.
Natixis SA Chief Executive Officer Laurent Mignon said yesterday the French bank is ending the London-based commodities brokerage business. Most of that business is industrial metals, with the remainder in agricultural commodities and energy, said Pierre-Henri Denain, senior country manager for Natixis in U.K.
The Paris-based bank plans to stop its “pure brokerage” business while keeping over-the-counter activities, Mignon said yesterday. The process of exiting the brokerage business may run until the end of this year, Denain said.
Natixis will remain a category 1 member of the LME in “the immediate future but it’s now working with customers to decide when it will cease offering ring-dealing services,” Denain said. “The bank may then decide whether or not to continue with a different level of LME membership to support its OTC sales and trading business.”
There are seven different categories of LME membership. Category 1 and 2 members provide access to the market and can clear trades, according to the exchange website. Only category 1 members have access to the ring. The exchange also has electronic and telephone trading.
Natixis will announce next week the restructuring of its over-the-counter commodity sales and trading business, Denain said.
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