Exchanges Watchful On Regulatory Overreach In Rules Revamp

BOCA RATON, Fla. (Dow Jones) - Futures exchange operators are wary that financial market regulators may overreach in their effort to address the 2008 financial crisis, resulting in more restrictive rules that will hinder growth in derivatives markets.

Market authorities must bear in mind the potential costs and benefits of new rules around trading and clearing derivatives contracts, and take care not to do "damage to the industry," said Craig Donohue, chief executive of CME Group Inc. (CME).

"It's a fundamental concern that in the rulemaking process, are the [Commodity Futures Trading Commission] and other agencies sticking to what Congress intended and not using this as an opportunity to legislate and get into areas well beyond the intentions of Congress," Donohue said, speaking Wednesday at an event hosted by the Futures Industry Association.

Garry Jones, head of derivatives business for NYSE Euronext (NYX), raised concerns around a potential "lack of focus" among regulators and the danger that they may be focusing on issues not intrinsic to the root cause of the financial crisis.

-By Jacob Bunge, Dow Jones Newswires; 312 307 4879; jacob.bunge@dowjones.com

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