Hire Wire Apr 27 2012

CME CEO To Step Down

By jacob bunge

CME Group Inc. Chief Executive Craig Donohue will step down and leave the company in the coming weeks, months earlier than previously planned as part of a low-key exit from the world's largest futures exchange operator.

Donohue last month said he would leave when his contract expires at the end of the year in what he called a personal move unrelated to criticism of the company's handling of the fallout from the collapse of brokerage MF Global.

"This will be my last earnings call," Donohue said on a call with analysts after CME reported a 42% drop in first-quarter profit.

CME President Phupinder Gill is expected to assume the CEO role before the company's annual meeting on May 23. The management changes will see Executive Chairman Terry Duffy add the role of president and focus on external relations amid increasing regulatory scrutiny of the firm's role as a market operator and regulator.

Donohue, who led the company for eight years and oversaw acquisitions that doubled its size, isn't expected to attend the annual meeting, Mr. Duffy said in an interview.

The rapid management transition comes as CME, like rivals, grapples with a decline in trading volume.

Daily trading activity on CME markets fell 11% during the first quarter compared with a year ago, when business was buoyed by heavy buying and selling amid unrest in the Middle East and a natural disaster in Japan. High-frequency traders, among CME's most active participants, have kept a lower profile this year, CME Chief Operating Officer Bryan Durkin said on Thursday's analysts' call.

CME executives outlined some cost-saving measures, including trimming an unspecified number of jobs through a voluntary program and moving some functions to a new office in Northern Ireland. The company also expects to retain $145 million from this week's sale of most of the historic Chicago Board of Trade building in downtown Chicago.

Gill reiterated that trading activity tends to rise and fall in cycles, and noted that the level of outstanding trades on CME's markets--a gauge of investor involvement--is up 15% since the beginning of the year.

This story first appeared on WSJ.com

Mia Lamar
contributed to this article.

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