Chinese-backed Apex said to have MAS nod to set up Singapore's third derivatives exchange

Apex is working on getting final approval from the Monetary Authority of Singapore, according to sources.
Apex is working on getting final approval from the Monetary Authority of Singapore, according to sources.ST PHOTO: LIM YAOHUI

SHANGHAI/SINGAPORE (BLOOMBERG) - Asia Pacific Exchange Pte (Apex), has received in-principle approval from the Monetary Authority of Singapore (MAS) to start a third derivatives exchange in the city, according to people with knowledge of the matter.

Apex is now working on getting final approval from MAS, according to the people, who asked not be identified because the information is confidential. The company, which has about 40 staff, plans to open its exchange with refined palm oil contracts, the people said. The commodity will be priced in dollars and physical delivery will be in Malaysia and Indonesia.

Apex would be a new rival for Intercontinental Exchange and Singapore Exchange, which already operate in South-east Asia's biggest derivatives market. The firm, which changed its name from Asia Investment Pte on Aug 17, has also been filling out its board, adding KKR senior adviser Lim Hwee Hua as a director, according to corporate filings. Ms Lim was Singapore's first female minister and second finance minister until 2011.

Former CME Group Asia head Wong Chong Fatt and Mimi Ho, a former MAS official who oversaw securities and futures supervision, have also joined the board, the records show.

"As a matter of policy, MAS does not comment on our dealings with individual parties," the regulator said in an e-mail response. A representative for Apex declined to comment.

Palm oil is the world's most widely consumed vegetable oil, found in goods such as ice cream, instant noodles and lipstick. Indonesia and Malaysia are the world's top producers of the commodity, and futures on crude palm oil are most actively traded at Bursa Malaysia Derivatives.

Apex said in an Aug 14 letter to Singapore's Accounting and Corporate Regulatory Authority that it was working with the city's financial regulator to get a licence as an approved exchange.

The company is majority-owned by Mr Eugene Zhu Yuchen, a China markets veteran who has served as head of the China Financial Futures Exchange and Dalian Commodity Exchange, as well as president of Shanghai Pudong Development Bank. Chinese hedge fund manager Ge Weidong's firm holds a minor stake, according to filings.