12.01.201709:48:00UTC+00Ecb President Mario Draghi Calls for Caution on Lse, Deutsche Boerse Merger

Deutsche Boerse and London Stock Exchange Group (LSE) have been working to overcome regulatory hurdles holding up their $28 billion merger. The European Central Bank President Mario Draghi in a letter to a member of the European Parliament on Wednesday said that the proposed merger should be carefully analyzed, particularly given Britain's decision to leave the EU.

“When a merger leads to a change in ownership of a euro-area bank, as could be the case for entities within Deutsche Boerse and LSE Group that are licensed as banks, the ECB has to analyze it carefully from a prudential perspective,” Draghi said.

Deutsche Boerse's Eurex is mainly active in exchange-traded derivatives, while the LSE's LCH.Clearnet is active in the OTC business. Merger would create the region’s biggest exchange operator. The European Commission has expressed antitrust concerns, particularly in the case of clearing of derivatives contracts.

The European Commission, is already analysing whether the proposed merger would damage competition. Beres, a French member of the European Parliament said the deal should be considered by the full commission, not just its competition arm.