The announcement by French bank Natixis in May 2012 that it was shutting down its base metals trading business was a powerful signal for the industry. Natixis is one of just 12 category one members of the London Metal Exchange (LME), the so-called ring dealers allowed to trade directly on the open-outcry floor of the world’s largest non-ferrous metals exchange.
The French bank earned $120m from all its commodities businesses in 2011, according to estimates by JPMorgan equities analyst Kian Abouhossein, who focuses on global investment banks. That is dwarfed by the US giants in the commodities business such as Goldman Sachs, Morgan Stanley and JPMorgan itself, which generate between $1bn and $2bn per year from commodities.
