Dubai exchange appoints HSBC as first general clearing member

abdelaziz Fathi

Dubai Financial Market (DFM), the Gulf’s only listed stock exchange, reported that it has on-boarded HSBC as the first international clearing member, according to a corporate statement.

By joining the DFM as a general clearing firm, HSBC is able to provide clients with access to higher liquidity, with tighter spreads than they get via offshore platforms. This includes clearing and settlement services to its customers worldwide and to other DFM trading members.

Per DFM’s regulation, this type of membership implies the separation of trading and clearing memberships to allow foreign financial institutions to provide clearing services to non-resident banks, companies and individuals operating on the Dubai bourse. Overall, the introduction of GCM service is part of a wider collaboration program between DFM and HSBC to enhance market infrastructure and connectivity with international and institutional investors.

DFM currently offers a CCP service for clearing derivatives trading on its subsidiary Nasdaq Dubai. As a central counterparty in the equities market, DFM’s CCP entity, which is part of a wholly owned post-trade subsidiary, takes on the role of legal counterparty for both the original purchaser and the original seller from the time an order is matched on the exchange.

The DFM is regulated by the country’s main financial watchdog, the Securities and Commodities Authority (SCA). Both entities are in collaboration to process similar applications from other clearing members.

Dubai is liberalising securities rules

Hamed Ali, CEO of DFM and Nasdaq Dubai, said: “We are delighted to welcome HSBC as the first international GCM on DFM. The introduction of HSBC’s GCM service on DFM is a key step toward a series of enhancements to market accessibility planned as part of our growth strategy. HSBC’s regional and international footprint and capital markets expertise will, I believe, help accelerate our growth plans.”

Abdulfattah Sharaf, chief executive officer, HSBC UAE and head of international, HSBC, added: “Being the first international general clearing member on the Dubai Financial Market aligns well with HSBC’s ambition to be the preferred international financial partner of our clients around the world. The appetite of international investors for securities issued by governments and corporates in the region is large and growing and our new role as a general clearing member on the DFM will enable clients across HSBC’s global network to invest in the potential here.”

The UAE’s market regulator, the Securities and Commodities Authority (SCA), has been liberalising securities rules in recent years, partly to secure an upgrade in its status to ‘advanced’ from ’emerging’ market by equity benchmark provider MSCI.

The introduction of clearing members reduces the risk exposure between participants in the central securities settlement process, whilst increasing confidence in the local market infrastructure. The DFM said that while market participants are currently required to maintain 100% collateral value for purchase trades, a central counterparty structure will reduce transaction costs for brokers. This is due to the number of settlement transactions carried out being reduced by means of transaction netting – in other words, only net positions are submitted for settlement.

Read this next


Stagflation Speculation: Is the UK Economy Heading for Uncharted Waters?

Amid rising concerns about a potential recession, the term “stagflation” is increasingly being used to describe the UK’s current economic scenario, characterized by conflicting indicators such as high inflation and stagnant growth.

Industry News

Exness Becomes Titanium Sponsor for 6th Annual Forex Expo in Dubai.

Multi-asset broker Exness has been named the Titanium Sponsor for the 6th edition of the Forex Expo in Dubai, further cementing its role as a key player and supporter in the trading industry.

Digital Assets

Mt. Gox victims to wait another year for repayments

Nobuaki Kobayashi, the trustee responsible for managing the assets of the now-defunct Mt. Gox Bitcoin exchange, has announced an extension of the deadline for repaying the exchange’s creditors.


Sumsub launches Non-Document Verification in the UK: Client onboarding in 5 seconds

Sumsub’s partnership with OneID introduces Non-Document Verification, enabling near-instant identity verification through official bank records while ensuring compliance with UK regulations.

Industry News

CFTC fines Advantage Futures $395,000 for 12.8 million unmonitored trades

Collectively, these failures by Advantage resulted in over 12.8 million cleared contracts not being processed or surveilled from July 2018 to June 2022. This accounts for nearly 1.5% of the trading volume by Advantage’s customers during that four-year period.

Industry News

SEC doubles down on fund names rule: “Growth”, “Value”, “ESG” better watch out

“As the fund industry has developed over the last two decades, gaps in the current Names Rule may undermine investor protection. Today’s final rules will help ensure that a fund’s portfolio aligns with a fund’s name. Such truth in advertising promotes fund integrity on behalf of fund investors.”

Industry News

ASIC sues crypto exchange Kraken over alleged margin trading product violations

“These proceedings should send a message to the crypto industry that products will continue to be scrutinised by ASIC to ensure they comply with regulatory obligations in order to protect consumers. ASIC’s action should be a reminder of the importance to comply with the design and distribution obligations so that financial products are distributed to consumers appropriately.”

Industry News

ASIC grants 332 new AFS licenses in 2023 (YoY)

ASIC’s annual licensing report aims to increase transparency and offer guidance to licensees, professional auditor registrants, and prospective applicants regarding ASIC’s licensing and professional registration decision-making processes.

Digital Assets

Lumerin launches P2P marketplace for BTC mining capacity

Lumerin, a decentralized hashpower marketplace, is set to launch on September 26th on the Arbitrum One network following a rigorous testnet period.