* Seeks to avoid bite from likely higher taxes next year
* CME usually issues annual dividend in Feb. or March
* Recently increased clearinghouse line of credit to $5 bln
By Ann Saphir
CHICAGO, Nov 28 CME Group Inc, the
biggest operator of U.S. futures exchanges, may pay out its
special dividend early to avoid a bite from higher taxes likely
next year, a top exchange official said on Wednesday.
"We'll be going to our board in December, to talk about
potentially pulling that payment into December to avoid some of
the tax uncertainty for receivers of that dividend," CME Chief
Financial Officer James Parisi told analysts at a conference
sponsored by KBW.
Several companies, including Costco Wholesale Corp
and casino developer Las Vegas Sands Corp, have declared
one-time cash dividends in recent days ahead of a likely
increase in the dividend tax rate unless Congress and the White
House reach an agreement on a new deficit-cutting plan.
Without action from lawmakers, the dividend tax rate will
rise to as high as 39.6 percent for the wealthiest Americans,
from 15 percent now.
CME usually issues an annual dividend in February or March,
Parisi also said CME is poised to capitalize on regulatory
changes that as early as next March will force a large swath of
the over-the-counter swaps market into clearinghouses such as
those that CME runs in the United States and London.
Last week, CME won approval as a swaps data repository, a
designation that allows it to capture and report data from its
swaps customers. Without the designation, CME would have had to
send its customers' data to a rival's repository.
"I look at it too as a way to help attract and maintain
customers in that over-the-counter space and make their
experience that much better," Parisi said.
CME will waive fees for the repository through next
September, he said, but could win new revenue by clearing swaps
and handling more futures as customers turn to those contracts
and away from what will be more capitally intensive
CME recently increased its clearinghouse line of credit to
$5 billion from $3 billion, to increase liquidity as a backstop
against any possible default ahead of the swaps rule changes and
the expected increase in OTC clearing business.