MF Global Ltd. (MF) plans to leverage rising Treasury bond issuance and the regulator-driven push to clear more derivatives amid weaker demand for its traditional brokerage services.

Chief Executive Bernard Dan on Thursday outlined the diversification as the company reported a larger-than-expected fiscal fourth quarter loss, weighed by a drop in commissions and special charges.

In an interview, Dan said the retail and institutional brokerage aimed to win market share in an interest-rate swap derivatives market that regulators are demanding use central counterparty clearing to reduce risk and improve transparency.

It is also applying for dealer status to take advantage of the rise in Treasury bond issuance to fund the U.S. stimulus package, filling part of a gap left by the disappearance of Bear Stearns and Lehman Brothers.

MF Global reported an adjusted net loss of $17.4 million for the three months to March 31, compared with a profit of $49 million a year earlier. The loss per share of 5 cents compared with a year-ago profit of 39 cents.

Shares in MF Global dropped following the announcement and recently traded 6.6% lower at $5.07.

The company was weighed by the slide in commissions as exchange-traded volume fell to 386.2 million contracts from 589.1 million a year ago. Revenue for the quarter fell to $256.7 million from $407.9 million a year earlier.

The strategic moves mark a counter-punch against banks that had received U.S. government support, which Dan argued gave them an implicit federal guarantee and made them more attractive to investors.

MF Global's own client funds have been hit by market volatility and its slow recovery from a rogue trading scandal last year, which raised questions over its risk management.

The company saw an increase in U.S. market share for the quarter, rising to 5.1% from 4.7% in December, as global client assets climbed to just over $12 billion.

Dan said the plans outlined by the U.S. last week to tighten oversight of the over-the-counter derivatives market provided an opportunity.

"All of that, to us, is potentially very beneficial," he said. "We're going to be positioned to take some market share."

The company conducted the first transaction through the International Derivatives Clearing Group, a subsidiary of Nasdaq OMX Group Inc. (NDAQ) set up to clear interest-rate swaps. Dan said MF Global is eyeing similar platforms as more OTC contracts are migrated to a cleared environment.

Dan also outlined a push into high-grade corporate debt markets, hiring 22 staff in the last quarter. The effort to secure dealer status would let the company participate in Treasury debt auctions. "The Fed's preference, with all the issuance planned, is to have more dealers," Dan said.

The Chicago Board Options Exchange's Vix volatility index this week hit an eight-month low, which Dan said should coax more professional and retail traders back into the markets.

While attempting to shake off some of its past, MF Global also revealed it is seeking a $30 million receivable owed by former parent company Man Group PLC (MNGPY).

Man, which remains MF's largest shareholder after its 2007 initial public offering, is seeking arbitration over the claim.

-By Jacob Bunge, Dow Jones Newswires; (312) 750 4117; jacob.bunge@dowjones.com

(Kerry E. Grace and Doug Cameron contributed to this article.)