As anticipated in last week's editorial, New York Mercantile Exchange announced that it had merged the clearing operations of its Nymex and Comex divisions and simultaneously obtained a $100m default insurance policy. The consolidation of the two clearing associations combines the guarantee funds of each clearinghouse to total $130m. The insurance policy was underwritten by Radian Asset Assurance. It would be invoked in the event that the guarantee fund is completely depleted due to a default by a clearing member firm. As a result of the consolidation, Comex Division trades are now processed on the Clearing 21 system alongside the Nymex Division trades, in a single processing stream.
Nymex continues to top the table of US exchange seat prices. A seat on the Nymex division last week sold for a record $1,356,000, topping the $1,350,000 sale on 29 April.
Nymex also announced that all transaction fees...