SocGen and Calyon agree to merge derivatives brokerages

Société Générale and Calyon have signed an agreement to merge their futures and options brokerages, Fimat and Calyon Financial.

Each of the two French banks will control half of the consolidated business, which will be called Newedge. It will have bank status and is scheduled to launch in early 2008, subject to regulatory approval. The combined group, based in Paris, is expected to have a staff of 3,000.

Marc Litzler, deputy chief executive of Calyon, will become chairman of Newedge, while Société Générale’s deputy chief executive, Philippe Collas, will be its vice-chairman. They will be appointed to the posts, which will alternate between the two parent companies, for two years. Both will also retain their current posts.

Meanwhile, Patrice Blanc, former chief executive of Fimat, becomes chief executive of Newedge. Calyon Financial’s former chief executive, Richard Ferina, will be its deputy chief executive.

In an announcement, Société Générale and Calyon said Newedge would be a world leader in trade execution, as well as clearing derivatives traded in more than 70 organised markets. In addition to its core business as a futures commission merchant, they said the new entity would continue to offer complementary services in the over-the-counter and spot markets.

The two banks made public their intention to create the unit earlier this year.

See also: SG and Calyon announce brokerage merger intentions