LME braces for more Chinese members

The London Metal Exchange currently has only one member from China.

The world's biggest metals exchange is bound to see more Chinese banks and brokerage firms becoming its members once the takeover of LME is completed by Hong Kong Exchanges & Clearing Ltd, perhaps by Dec. 6. The lone Chinese member is BOC International.

"Now we have this one member on shore, we are expecting to see more (banks or brokerage) to become our members in the future," said Catherine Markey, head of education and marketing at LME.

She said member applicants will have to establish separate companies in the European regulation zone, a move that costs a lot of money. LME does not solicit members.

"We obviously would like to see more companies become LME members, especially from this region (China), but that's up to them to make the application," she said.

LME, however, has no plans to open an office in Hong Kong since HKEx, its parent company, will provide necessary support.

For the first 10 months of this year, LME saw its daily turnover rise 8% year-on-year to some 600,000 lots. Its metal exchange's daily turnover, on the other hand, increased by 22% in 2011.

LME accounted for at least 93% of global exchange open interest as of October.