Interdealer broker ICAP (IAP) is among the biggest blue chip gainers at the open in London after it secured a deal to provide key foreign exchange and bond trading infrastructure in mainland China.

Shares in ICAP are up 2.5% on news of the three-year, $65 million (£45 million) contract which will see the China Foreign Exchange Trade System (CFETS) use its EBS BrokerTec electronic trading platform as a venue to execute trades.

ICAP and CFETS already have a commercial relationship stretching back nine years.

ICAP - Comparison Line Chart (Rebased to first)

'China is an extremely important financial market and we are honoured that our long term partner, CFETS, has asked us to collaborate with them to build a significant platform which will play a key role in the future of the renminbi,' said ICAP chief executive Michael Spencer.

The deal could also be a positive step in London's fledgling market in trading China's currency offshore.

China's Finance Ministry issued its first bonds in London in May this year, selling CNY3 billion (£350 million) of paper in a process managed by Bank of China (3988:HKG) and HSBC (HSBA).

'I am glad that as our partner, EBS BrokerTec is helping us to achieve our goal,' said Xu Zaiyue, at CFETS.

'I firmly believe NGTS will become one of the most important infrastructures of China's RMB market and provide strong and steady support to the development of China's inter-bank market and globalisation of the RMB.’

ICAP is in the process of a complex asset swap which will see it focus on its electronic broking platform and change its name to NEX.

Shareholders in ICAP will also receive shares in an enlarged [BOLD] Tullett Prebon (TLPR), which is acquiring ICAP's voice broking business.

Voice broking helps institutions execute more complex trades on alternative or illiquid assets.

Issue Date: 03 Jun 2016