LIFFE cuts 600 jobs to stem drift of business
Tuesday 03 November 1998
Chairman Brian Williamson has set the exchange the target of more than halving costs from pounds 138m to pounds 60m by the end of next year. The moves are in response to the loss to Frankfurt of business in the all-important German bund contract which has sparked concern about the ability of London to remain competitive, particulary as exchanges like Frankfurt and Zurich join forces in preparation for the introduction of the Euro next year.
Mr Williamson said yesterday that having decided on a course of action to win back the support of members, he was now ready to embark seriously on attempts to forge partnerships with other exchanges abroad.
Mr Williamson said that Frankfurt and Chicago would inevitably be on the list of exchanges with which Liffe would wish to deal, as would the London Clearing House. Mr Williamson said he was at one with David Hardy at LCH on the need to offer seamless clearing services, but insisted that although a full-blown merger was an option it was not necessarily the best way to achieve this.
LIFFE, he said, had had a large number of approaches from other exchanges wishing to ally with it, but had felt that it needed to get its own house in order before it could enter into meaningful discussions.
However, he insisted that any moves would have to be driven by the needs of customers not those of the exchange. He pointed to the case of Chicago which had so lost the confidence of members that some had started looking into setting up their own rival market. London, he pointed out, still turned over pounds 264bn worth of contracts each day.
"We have to deliver an efficient trading platform together with the products that our customers want at a price they are prepared to pay," Mr Williamson said.
"It is clear that nothing remotely like our current cost base is sustainable and that we shall have to cut costs to remain competitive," he added.
After consulting with the exchange's members, and its own internal committee, known as the Fast Progress Group, the Board, he said, had decided to focus on three priorities: finances, regulation and new partnerships.
A key part of the strategy unveiled yesterday will be to cut a swathe through the regulatory rulebook in an attempt to counter widespread criticism in the City that LIFFE's belt-and- braces approach to regulation was inappropriate for a market which deals exclusively in products aimed at a sophisticated wholesale market.
"It is the user that will call the shots," he says.
LIFFE will also speed up the move from open outcry to screen-based trade and step up efforts to overhaul its technology to cope with increasingly sophisticated demands.
Mr Williamson said the existing rulebook which was largely inherited from the outmoded Chicago model is based around the pit and no longer appriopriate in a screen-based market.
LIFFE yesterday refused to be drawn on where precisely the jos cuts would fall. However, at least 350 of the staff currently working at LIFFE are IT specialists working on a contract basis on specific projects like the LIFFE Connect electronic trading platform which is to be rolled out later this month.
The phasing out of pit trading will inevitably mean that the 100 or so staff responsible for supervising trade at the 10 futures pits at LIFFE in Cannon Bridge, London will no longer be needed. Simplifying the rulebook would also reduce the need for the current levels of staffing in the supervisory and investigation departments to be retained.
Culinary experts in The Netherlands thought it was 'fresh' and 'tasty'
Of all the computers Apple has ever made there’s only one that Steve Jobs had to sell his car to finance
Actress sees off speculation about her face in an amazing way
Marvel has released first teaser trailer week early after it leaked online
- 1 As an ex prostitute, I urge all the political parties to commit to the Sex Buyer Law
- 2 Nokia no more: Microsoft drops once-ubiquitous mobile name – in favour of its Lumia brand
- 3 Renee Zellweger on plastic surgery: 'I'm living a fulfilling life and I'm thrilled that perhaps it shows'
- 4 Australian café owner sparks debate after saying 'No' to having unruly children on premises
- 5 Couple die within 28 hours of each other after being married for 73 years
Renee Zellweger on plastic surgery: 'I'm living a fulfilling life and I'm thrilled that perhaps it shows'
Isis releases first video showing the stoning of woman accused of committing adultery as her father shouts 'don't call me Dad'
Banksy not arrested: Internet duped by fake report claiming artist's identity revealed
Diwali: What is the festival of lights and how is it celebrated around the world?
Nelson Bunker Hunt dead: Former world’s richest man dies in 'modest circumstances' in US after losing his fortune
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Of course, teenage girls need role models – but not like beauty vlogger Zoella
Support for EU membership 'at highest level since 1991' with most Brits wanting to stay 'in'
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
iJobs Money & Business
£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...
£18000 - £23000 per annum + Commission: SThree: The SThree group is a world le...
£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...
£20000 - £25000 per annum + OTE £Competitive: SThree: SThree Group and have be...