BATS' Hotspot to launch forex matching engine in London

LONDON, March 25 (Reuters) - Currency trading platform Hotspot will launch this year a matching engine in London as part of its efforts to catch up with global market leaders Thomson Reuters and ICAP (LSE: IAP.L - news) -owned EBS, Hotspot owner BATS Global Markets said on Wednesday.

Matching describes one of the main types of process by which banks and other major financial institutions trade currencies with each other.

By siting the facility in the same data centres in London already occupied by Thomson Reuters and EBS, BATS said it hoped to start a process that would see it become the largest player globally. It did not say when this year it would launch the engine.

BATS runs the second-largest U.S. exchange group by volume of shares traded, and the biggest pan-European exchange. It also has an options exchange and recently entered the foreign exchange market with its $365 million acquisition of Hotspot from KCG Holdings Inc (NYSE: KCG - news) .

"This project is important for our current - and future - customers as it gives BATS a larger footprint in the leading trading centre in the FX world," BATS President Chris Concannon said.

The London matching engine will target markets in Europe and Asia which make up more than half of all global currency trading. Hotspot will continue to operate its existing matching engine in the New York area.

The platform averaged daily volumes of around $32 billion in the fourth quarter of last year from a customer base of more than 220 clients that includes banks, hedge funds and other institutions.

EBS averaged between $105 billion and $130 billion a day in the same period while those at Thomson Reuters, including both its matching engine and the multi-dealer FXAll platform, reached more than $350 billion a day. (Reporting by Patrick Graham; editing by Susan Thomas)