November 14, 2012 10:25 pm

Turquoise names Tiefenbrun chief executive

Turquoise, the pan-European trading platform, has promoted Natan Tiefenbrun to be its new chief executive as it bids to turn around declining trading on its key markets.

Mr Tiefenbrun, previously Turquoise’s head of equity and derivatives products, will replace the departing Adrian Farnham, who is joining the London Metal Exchange as chief operating officer of its planned clearing house.

Turquoise has targeted trading of index and stock derivatives to go alongside its main equities business, as part of the long-term goal of parent group London Stock Exchange to boost revenues from derivatives trading.

However, in common with rival exchanges and interdealer brokers, Turqoise has suffered from low appetite for trading and tough comparative figures. In the five months to August 31, average daily equities volumes fell 23 per cent to €1.6bn while the number of derivatives contracts slid from 35 per cent to 11.4m.

The LSE operates Russian, Scandinavian and Italian derivatives businesses but they account for only a fraction of group revenues. Xavier Rolet, chief executive, has in the past spoken of quadrupling LSE revenues from derivatives trading.

Turquoise has become the second-largest alternative share trading venue in Europe behind BATS Chi-X although its market share of around 5 per cent is only a fifth of its rival’s. Its greatest success to date has been in trading Russian equity and index derivatives.

The bourse is looking to challenge NYSE Liffe and Eurex, owned by Deutsche Börse, on their long dominance over some of the most widely-traded contracts.

Critics have argued Turquoise and other new entrants face an uphill struggle as it is notoriously hard to persuade traders to shift from using an exchange that has a near-monopoly in a derivatives contract to a newcomer.

“Natan has an in-depth understanding of capital markets and has been instrumental in Turquoise’s growth to date,” said David Lester, chairman of Turquoise. “I would like to thank Adrian for his contribution to the business since it was founded and to wish him well as he leaves to pursue new opportunities”.

Mr Farnham joined Turquoise in 2007 after a 13-year stint at Morgan Stanley and became chief executive in 2010. He will take up his role at the LME in early 2013 alongside Chris Jones, who was appointed chief risk officer for LME Clear last week.

The LSE reports interim results on Friday.

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