Santander AM Joins Eurex FX

Santander Asset Management has started trading FX futures on Eurex, supported by Banco Santander as clearing member and Deutsche Bank as liquidity provider.

Eurex says the move “underlines the trend towards listed FX business”, adding, “More and more market participants are utilising listed FX derivatives as a tool to hedge their portfolio performance. This is increasingly impacted by rising costs stemming from counterparty risk and related regulations.”

The exchange adds that Santander also plans to establish an FX options business at Eurex, supported by Deutsche Bank, the firm traded the first FX options block trade ever on the exchange.

“This is a great addition on our way to becoming the leading FX liquidity hub in Europe,” says Jens Quiram, global head of FIC derivatives and repo sales at Eurex. :By now trading and clearing listed FX derivatives on Eurex, Santander Asset Management benefits from low exchange fees and regulatory certainty within the EU.”

Imanol Urquizu, head of derivatives at Santander Asset Management, adds, “In addition to our engagement in FX futures we actively collaborate with multiple FX dealers to explore the trading of FX options at Eurex. Integrating FX futures and FX options within the Eurex ecosystem unlocks operational efficiencies and enhances our risk netting capabilities.”

Although Eurex cites good growth in its FX futures suite – it says volumes have nearly tripled since 2020 – FX futures in Europe remains a small part of the market at under EUR 1 billion per day, something the exchange clearly hopes will change as regulation starts to bite. In Q1, 2024, Eurex saw more that 586,000 FX contracts traded, which is a 16% increase on the first quarter of 2023. For comparison, sister firm 360T saw am 8.2% increase in OTC FX volumes across all FX products, and an 11.2% increase in spot FX volumes.