8-KMaterial AgreementsFinancial EventsExhibits & Filings

CME GROUP INC. 8-K Report, Material Agreement (Nov 8, 2016)

Filed November 8, 2016For Securities:CME

Summary

CME Group Inc. (CME) filed an 8-K on November 7, 2016, reporting the renewal of its 364-day multi-currency credit facility on November 3, 2016. This facility provides a $7 billion line of credit to Chicago Mercantile Exchange Inc. (a subsidiary of CME Group) to ensure liquidity during specific operational circumstances, such as potential defaults by clearing members or disruptions in money transfer systems. The credit facility is secured by clearing firm guaranty fund contributions and performance bond assets held by CME. Importantly, the agreement includes provisions for potentially increasing the credit line up to $10 billion, subject to the agreement of participating banks. This renewal underscores CME's proactive approach to managing financial risk and maintaining operational stability.

Key Highlights

  • 1CME Group Inc. renewed its 364-day multi-currency credit facility on November 3, 2016.
  • 2The credit facility provides a $7 billion line of credit to its subsidiary, Chicago Mercantile Exchange Inc.
  • 3The facility's purpose is to provide temporary liquidity in cases of clearing member defaults or money transfer system disruptions.
  • 4The credit facility is collateralized by clearing firm guaranty fund contributions and performance bond assets.
  • 5There is an option to increase the credit line to $10 billion, subject to lender approval.
  • 6The renewal demonstrates CME's commitment to maintaining financial flexibility and operational resilience.

Frequently Asked Questions

The primary purpose of the credit facility is to provide temporary liquidity to Chicago Mercantile Exchange Inc. (a subsidiary of CME Group) in specific situations, such as when CME is entitled to use clearing member collateral to cover defaults or if there are disruptions in money transfer systems affecting CME's operations.

The credit facility is initially set at $7 billion. However, CME has the ability to seek an increase of this line of credit up to $10 billion, contingent upon the agreement of the participating banks.

The credit facility is secured by clearing firm guaranty fund contributions and performance bond assets that are held by CME.

Key financial institutions involved include Bank of America, N.A. (as Administrative Agent), Deutsche Bank Trust Company Americas (as Collateral Agent), and several others acting as Syndication Agents and Joint Lead Arrangers/Bookrunners, such as Bank of China, BMO Harris Bank N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., Barclays Bank PLC, Citibank, N.A., and Wells Fargo Bank, National Association.