OTC Clearing Hong Kong Limited (OTC Clear), a subsidiary of Hong Kong Exchanges and Clearing Limited (HKEx), announces that the Securities and Futures Commission (SFC) has on 25 October 2013 granted it recognition as a clearing house under section 37 of the Securities and Futures Ordinance. OTC Clear is established for the purpose of providing clearing services for over-the-counter (OTC) derivatives.
“The launch of OTC Clear is another major step in our strategic plan to build a strong fixed income, currencies and commodities business, and to transform ourselves into a fully horizontally and vertically integrated platform across multiple asset classes. OTC Clear will help us capitalise on the Renminbi’s (RMB) continuing internationalisation, leveraging on Hong Kong’s position as the premier offshore RMB centre,” said HKEx Chief Executive Charles Li.
Completion of founding shareholders programme
Following the SFC’s recognition of OTC Clear, HKEx completed today the subscription agreement under which 12 financial institutions agreed to subscribe for non-voting ordinary shares of OTC Clear as founding shareholders. Details regarding the subscription were announced in this news release issued in April this year.
The 12 founding shareholders together hold 25 per cent of OTC Clear’s total issued share capital while HKEx holds the remaining 75 per cent. HKEx continues to hold 100 per cent of OTC Clear’s voting ordinary shares.
The founding shareholders represent a cross-section of financial institutions with local, Mainland Chinese and international interests and HKEx believes that their support will provide a good foundation for OTC Clear’s future development.
OTC Clear’s board of directors
As at 31 October 2013, the members of OTC Clear’s board of directors are as set out below. All directors are appointed by HKEx, save for Oliver Bettin, Sun Yu and Hossein Zaimi, who are appointed by the founding shareholders.
OTC Clear board
Michael LEE# - Chairman
Gerald GREINER* - Chief Executive
Oliver BETTIN^
Moses CHENG#
Hugh GRAHAM#
Roger HEPPER+
LAM Kin#
Charles LI*
SUN Yu^
Hossein ZAIMI^
* Senior Executive of HKEx
# Independent Non-Executive Director
^ Appointed by founding shareholders
+ Client representative
Launch target and initial services
OTC Clear is planning to start offering its clearing services in November 2013. It will handle inter-dealer trades initially and plans to introduce client clearing services in mid-2014. Initially, OTC Clear intends to offer clearing services for interest rate swaps denominated in RMB, Hong Kong Dollars, US Dollars and Euros, and non-deliverable forward currency swaps referencing RMB, Taiwan Dollars, Korean Won and the Indian Rupee. Details of OTC derivatives clearing and settlement services are available on the HKEx website.
OTC Clear intends to expand its clearing services to other OTC derivative products when appropriate.
OTC Clear Directors’ Biographies
Michael LEE
Mr Lee is Managing Director of MAP Capital Limited, an Independent Non-Executive Director of HKEx, Chen Hsong Holdings Limited and Trinity Limited, and a Non-Executive Director of Hysan Development Company Limited (Hysan). He was Chief Operating Officer of Hysan from 2002 to 2003 and Managing Director from 2003 to 2007. Mr Lee was a member of the Listing Committee and GEM Listing Committee of The Stock Exchange of Hong Kong Limited (SEHK) from 2004 to 2007 and 2006 to 2007 respectively.
Mr Lee holds a bachelor’s degree from Bowdoin College and an MBA from Boston University, which are both in the US.
Gerald GREINER
Mr Greiner is HKEx’s Head of Global Clearing. He joined HKEx in May 2004 as the Deputy Chief Operating Officer. Prior to that, he was the senior director of the Supervision of Markets Division at the Securities and Futures Commission (SFC). Before joining the SFC in 1989, he held several senior executive positions in the US Securities and Exchange Commission.
Mr Greiner holds a bachelor’s degree in Economics from the US’s Allegheny College and a Juris Doctor degree from the University of Toledo College of Law in the US.
Oliver BETTIN
Mr Bettin is a Managing Director and Head of Asset Financing, Asia of Deutsche Bank based in Singapore. After working in numerous risk management roles for Deutsche Bank in London, New York and Geneva, he moved to Singapore in 2007 to set up the AsiaPac CVA desk for the FX department. Since 2012 he runs Deutsche Bank’s Liquid Asset Financing business in Asia. He is also responsible for front office CCP risk management in Asia.
Moses CHENG
Dr Cheng is the Senior Partner of PC Woo & Co. Currently, he also serves as Chairman of the Process Review Panel for the SFC and a member of the National Committee of the Chinese People’s Political Consultative Conference. He was an independent non-executive director of HKEx from 2006 to 2012. He was the deputy chairman and chairman of the Listing Committee and GEM Listing Committee of SEHK from 2003 to 2005 and 2005 to 2006 respectively, and a council member and the convenor of the Disciplinary Committee of SEHK from 1997 to 2000.
Dr Cheng is a qualified solicitor in Hong Kong, England and Wales, Victoria of Australia and Singapore. He holds a Bachelor of Laws degree from the University of Hong Kong.
Hugh GRAHAM
Mr Graham has nearly 30 years of experience in the financial services industry in the UK and Asia Pacific. He is currently Group Head of Risk and Capital Management in AIA Group. Mr Graham began his career with Barclays Bank, London and subsequently had senior roles in investment banking in Australia and Asia. He became deputy Treasurer of Barclays in 1999, Group Treasurer of Australia’s AMP Group from 2001-2003 and of the Zurich Financial Services Group from 2004 until 2009 before assisting the UK government in the restructuring of the UK’s wholly owned nationalised banks.
Mr Graham holds a master’s degree in History from the University of St Andrews in the UK.
Roger HEPPER
Mr Hepper is Managing Director and Chief Operating Officer of JP Morgan Asset Management, Asia Pacific. He has been in Hong Kong since 1995, when he became a senior finance manager of Jardine Fleming Unit Trusts. Mr Hepper was Head of Risk, Technology & Operations of JP Morgan Asset Management, Asia Pacific before he took up his current role in 2003.
Mr Hepper holds a bachelor’s degree in Accountancy and Financial Management from Loughborough University of Technology in the UK.
Professor LAM Kin
Professor Lam is the Honorary Professor of the Department of Statistics and Actuarial Science of the University of Hong Kong and the Professor Emeritus of the Department of Finance and Decision Sciences of the Hong Kong Baptist University, where he served as Chair Professor and Head of Department from 1995 to 2008. He was a director of HKFE Clearing Corporation Limited and Hong Kong Securities Clearing Company Limited (HKSCC) from 1992 to 2000 and 1998 to 2000 respectively and a member of the Risk Management Committee of HKEx and Disciplinary Committee of HKSCC from 2000 to 2005 and 1999 to 2000 respectively.
Professor Lam has a bachelor’s degree in Mathematics from the University of Hong Kong and a PhD in Mathematics from the University of Wisconsin-Madison in the US.
Charles LI
Mr Li has been Chief Executive of HKEx since January 2010. Before joining HKEx, he was chairman of JP Morgan Chase China. Mr Li has also worked for Merrill Lynch and was president of Merrill Lynch China. Before moving to Merrill Lynch in 1994, he practiced law in New York with Davis Polk & Wardwell and Brown & Wood.
Mr Li has a bachelor’s degree in English Literature from China’s Xiamen University, a master’s degree in Journalism from the University of Alabama and a Juris Doctor degree from the Columbia University both in the US.
SUN Yu
Mr Sun has been General Manager, Global Markets of Bank of China (Hong Kong) since 2012. He started his career in the Financing Division of the Treasury Department in Bank of China Head Office in Beijing in 1998. From 2010 to 2012, Mr Sun worked in Bank of China Shanghai Branch as Deputy General Manager overseeing various departments, including Retail Banking, Private Banking, E-banking, Credit Card, Financial Institution Department and Global Market Departments.
Mr Sun holds a bachelor’s degree from Dongbei University of Finance and Economics and a Master’s degree (EMBA) from Nankai University, which are both in China.
Hossein ZAIMI
Mr Zaimi has been Managing Director and Head of FX and Commodities for HSBC in Asia Pacific since 2009. He joined HSBC in 2004 as Head of FX and Precious Metals Derivatives, Asia-Pacific, and was subsequently Head of FX-Rates Hybrids, Asia Pacific. Mr Zaimi began his career at Salomon Smith Barney in Paris and became the firm’s Head of FX Derivatives, Asia Pacific, in 1997. Between 1998 and 2004 he was Head of FX Derivatives Asia Pacific at Credit Lyonnais.
Mr Zaimi holds master’s degrees in Finance and Management-Finance from the University of Paris-Sorbonne in France.
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