LONDON - Chicago Mercantile Exchange (CME) remains the world’s most valuable exchange brand despite its brand value dropping 1% to US$1.3 billion, according to the latest report by Brand Finance, the world’s leading independent brand valuation and strategy consultancy. This achievement comes on the back of their huge business volumes, with steady growth delivering the highest revenues amongst global asset exchanges.

 

According to Brand Finance, the second-most-valuable exchange brand in global asset exchanges is the New York Stock Exchange (NYSE, down 10% to US$1.1 billion) which dropped significant brand value as revenue forecasts fell slightly from last year’s very high expectations. Despite this, it remains the exchange brand with the highest brand strength rating.

 

Brand values across the sector have dropped slightly as a result of increased technological competition causing greater future uncertainty.

 

David Haigh, CEO of Brand Finance, commented:

 

“In a world where decentralized, peer-to-peer exchange platforms are beginning to arise in the form of cryptocurrencies, the brands of the big global financial exchanges are under threat. The big incumbents will increasingly need to work hard to retain the trust of their key stakeholders when there are new technology options which aspire to end the need to trust middle-men such as these exchanges to conduct financial transactions.”

 

Big Exchange Brands Dominated by Revenues, not Market Capitalisation

HKEx (down 5% to US$1.0 billion) and NASDAQ (down 1% to US$0.8 billion) retained their third and fourth rankings respectively, but suffered from similarly stagnant brand values for many of the same reasons as CME and NYSE. While NASDAQ – in addition to NYSE and the London Stock Exchange (down 24% to US$0.4 billion) – are amongst the world’s largest in terms of listed market capitalisation, their business models do not typically leverage this listed market capitalisation into revenue with such relative effectiveness as CME or ICE (up 24% to US$0.8 billion).

 

CBOE Brand Value Surges with Branding Focus

CBOE Global Markets (up 52% to US$0.4 billion) enjoyed strong brand value growth as the world’s fastest growing exchange brand. This growth was largely in connection with the acquisition of BATS Global Markets and the consequential rebranding from BATS to CBOE Global Markets. While this means that the CBOE brand is now worth more, the termination of the BATS brand caused a significant amount brand value to be lost.  The former BATS brand value of US$327 million, which has been incorporated into the new brand entity, has been lost in the merger and associated rebranding.

 

London and New York Stock Exchanges Remain Strongest

In addition to measuring overall brand value, the Brand Finance Exchanges 10 2018 report also measures brand strength. Brand strength is calculated using financial and non-financial metrics measuring the perceptions of a range of stakeholders, and is used to benchmark brands against their competitors in the sector. This year’s strongest exchange brands were the New York Stock Exchange and the London Stock Exchange, which both obtained AA+ ratings. NYSE maintained this rating from last year, but the London Stock Exchange’s brand benefited from strong capital raising performance, raising £15bn from 106 initial public offerings in 2017, the highest level for three years.