Euronext expands Eurozone Banks Index derivatives suite

The new option contract will beat competitors’ offerings with stronger financial advantages, the exchange operator claimed.

Euronext has launched an option contract based on its Eurozone Banks Index, co-designed with market participants to meet their demands for an alternative product.

The announcement follows the launch of a future contract on the Euronext Eurozone Banks Index in May earlier this year, which it claimed to have traded more than 10,500 lots with a total nominal value traded of €290 million.

Euronext said the expanded offering would provide value-added solutions to market participants, allowing them to beat competitors’ offerings with stronger financial advantages.

It will provide a nominal value which is five times larger to enable economies of scale at the clearing level, a fairer cost structure, and lower large-in-scale minimum sizes to facilitate off-screen transactions.

Euronext will provide on-screen liquidity on both contracts by markets makers including BNP Paribas, DRW, Flow Traders, Mako, Tower Research and Societe Generale.

“A few months after the launch of our future contract, our new option contract on the Euronext Eurozone Banks Index has been co-designed with market participants to answer strong demand for an alternative product with a fair cost structure to trade the Eurozone banking sector,” said Stéphane Boujnah, chief executive and chairman of Euronext.

“In line with what we have already implemented on our dividend futures, this combination of higher nominal value and lower exchange fees is expected to be extremely well received by clients, such as the improved accessibility to off-screen transactions.”

The news follows the London Stock Exchange Group’s clearinghouse LCH confirmation in June earlier this year that it would be launching clearing services for the Euronext Growth Oslo Market later that month aimed at giving market participants further netting and settlement efficiencies.