Whelan Exits EBS as CME Unveils Restructured FX Business
Posted by Colin Lambert. Last updated: October 3, 2023
With The Full FX View
Hugh Whelan, head of EBS Direct, is leaving CME Group as part of a broader restructuring of CME’s FX business, the Merc confirms his departure under the restructuring which it says is aimed at creating a more client-focused structure. Whelan is believed to be staying with the business to assist the transition over the coming weeks.
The changes are the latest part of what The Full FX believes to be an ongoing process to re-engineer the FX business aimed at bringing the futures and OTC teams closer together. This was kicked off with the appointment of Paul Houston as head of both CME and EBS in August, following the departure of former global head of EBS, Jeff Ward, to head up FXSpotStream.
Sources at CME say the changes have been planned for some time following the migration of the EBS platform to CME’s tech stack on Globex, and that “net-net” there has been no change in headcount. The new structure broadly has three lines; developed markets, emerging markets, and platforms and workflow. The sources say the hope is that streamlined roles and responsibilities will provide a more productive structure that can grow the business across both futures and OTC.
Under the new structure, a new leadership team has been formed, under Houston’s leadership; Matt Gierke, formerly head of EBS Market, is executive director, developed currencies, while Chris Soriano is his equivalent in emerging markets – previously he was head of cash emerging markets for EBS. Former UBS e-product COO Shereen Lewejohann is taking on responsibility for the APAC region. She has been with CME for just under a year as head of APAC FX futures and options, and will continue to be based in Singapore. Phil Hermon, formerly product lead of FX futures, has been named head of FX growth and execution.
10-year EBS veteran Andrew Cheesman, currently global head of FX prime and credit management at EBS, is named head of platform and workflows. His team is tasked with providing day-to-day support and management of all CME Group FX platforms, including EBS Direct, as well as working with the emerging and developed currency teams to drive product development and strategy.
Elsewhere, Chris Povey continues as head of FX options in the new structure, as does Ellie Stanley as head of business strategy and regulation.
The Full FX View
My understanding is that these changes are very much aimed at bringing the two CME FX businesses closer together – all the time understanding the obvious contraints that may exist around accessing certain products.
Sources at CME are keen to stress that the EBS brand is not being diminished, and that the OTC business remains hugely important – and of course they would say that – but it has to be said that the surprise over these changes is not so much that they are taking place, rather than they have taken so long to implement.
In August I wrote about the opportunity for CME if it can bring a sharper focus to the FX businesses and this structure seems to achieve that. It doesn’t make sense to have one set of people targeting OTC clients and another futures – there are fungibilities there that should be at least explored, if not exploited – so hopefully for CME, the new structure provides just such an environment.
As I noted a few weeks back, the real opportunity probably lies outside the spot market, although the latter should not be ignored, which requires a role that could be termed “product management” rather than “liquidity management”, the latter being a traditional role at an OTC platform.
With everything on one tech stack, CME has the opportunity to establish a true multi-faceted FX business and more reflect the relationship with liquidity consumers that the banks have – where the client is engaged with on more than just the products they have historically used.
The FX market structure continues to change and with these changes to the way it goes about its own business, the sense is CME is seeking to stress its product breadth, while having the message delivered in a more efficient, focused manner The interest now turns to what any product or service innovation looks like as OTC and futures come closer together in one small part of the industry.