This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Banks Fret Over NYSE-German Hookup

Stocks in this article: NYX

By the Financial Times

Some of the world's biggest banks are privately expressing concern over the market power of a proposed tie-up between Deutsche Börse and NYSE Euronext.

The bourses are expected on Tuesday to announce details of merger to create the world's biggest exchange group by revenues and profits, following approval by boards meeting in the US and Germany.

The new entity would have a more than 90 per cent market share in European derivatives through the combination of Deutsche Börse's stake in Eurex based in Frankfurt, and NYSE Liffe in London.

It would also trade some 28 per cent of European equities volume and 40 per cent of the US options market, according to analysts at Sandler O'Neill.

"In the early stages, this deal doesn't appear to have great benefits to broker-dealers," a broker at a large Wall Street banks said.

Other bankers said the combined group could also wield considerable power in the over-the-counter derivatives markets, and in clearing of them. "The exchanges themselves could be construed as more of a competitor to dealers now," said Bob Fitzsimmons, head of derivatives at brokerage ITG.

Such concerns are emerging amid sensitivity on both sides of the Atlantic over which of the two groups will ultimately have the most power in the merged entity.

They were stoked by comments yesterday by Johannes Witt, a labour representative on the Börse's supervisory board, who said: "Just like in the Euronext deal, it will be a matter of time before the Americans take control. We should be wary of this."

However, people familiar with the deal said executives at the German exchange are set to get five of nine positions on the new group's board.

From Deutsche Börse, Reto Francioni, chief executive, will be chairman; Andreas Preuss, deputy chief executive, will head derivatives; and Gregor Pottmeyer, chief financial officer, will carry on in that job.

Jeffrey Tessler, head of Deutsche Börse's Clearstream subsidiary, will head clearing and settlement; and Frank Gerstenschläger, head of cash equities, will be head of market data in the enlarged company.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs