SGX Completes World’s First USD/CNH FlexC FX Futures Trade

Major step forward in bringing together surety and cost efficiency of listed FX futures with flexibility and relationship-based OTC FX trading

Singapore Exchange (SGX) has successfully completed the world’s first USD/CNH Flexible FX futures trade. The transaction involved Bank of China (Singapore) and ICBC (Singapore) executing 2 CNH FlexC FX futurised swap trades on SGX. A total notional value of US$8 million changed hands.

The transaction marks a major step forward in bringing together the listed and OTC markets in FX. With global regulatory initiatives such as Basel III and MIFID II coming into play, financial institutions are facing an increasing burden of capital requirements that include Leverage Ratio, Liquidity Coverage Ratio and Counterparty Credit Risk charges, as well as Uncleared Margin Rules (UMR) for OTC derivatives. SGX FlexC Futures offer an effective solution to maximise capital and operational efficiencies, reduce costs and counterparty credit risk, while retaining bilateral trading relationships.