Bucking the trend of foreign banks curtailing their operations in the United States, several European and Japanese institutions are expanding futures and options trading by acquiring U.S. brokers.

Among the two latest foreign banks to enter the field are Britain's National Westminster Bank PLC and Japan's Sakura Bank Ltd.

Earlier this month, the Federal Reserve Board granted the British bank approval to acquire Burns Fry Futures Inc., a Chicago-based futures broker that had once been controlled by Security Pacific Corp.

Sale Expected to Close Soon

A spokesman for National Westminster in New York said the bank expected to close the deal within several weeks, but he declined to comment further.

Sakura Bank, the second-largest bank in the world, this month requested Fed approval to advise and trade in futures and options on futures by acquiring 60% of Dellsher Investment Co., a Chicago-based boutique that is owned by financial futures pioneer Leo Melamed.

Sakura and NatWest are only the latest in a string of foreign banks that are beefing up futures trading and brokerage in the United States.

Hedging Costs at Issue

Many of the banks are getting into the business to save fees on their own trading, much of which involves execution of sophisticated interest rate and currency hedging strategies.

"Banks need to manage and hedge huge portfolios, and they need to reduce the cost of brokerage," said a senior official with Sakura Bank, who asked not to be named.

In January, Swiss Bank Corp. took control of O'Connor Partnerships, a respected Chicago based futures and options trading firm, after investing some $70 million in a joint venture with the company a year earlier.

Another Japanese bank, Sanwa Bank Ltd., also trades futures through Sanwa-BGK Securities Co.

Dutch Bank Has Chicago Ties

Still another foreign bank, Holland's International Nederlanden Bank NV, has close business links with Quantum Financial Services Inc., another Chicago-based futures broker.

Internationale Nederlanden, created this year from the merger of NMB-Postbank with the insurance company Nationale Nederlanden, has provided $50 million in subordinated capital to Quantum and holds an annually renewable option to purchase 100% of the firm. However it would need Fed approval to make the investment.

Market sources said other big European banks, including Union Bank of Switzerland, Deutsche Bank, and Commerz-bank, are at various stages of expanding their U.S. futures trading.

But they also warned that a slowdown in processing foreign bank applications at the Fed -- attributed to extreme caution because of the recent BCCI and Banca Nazionale de Lavoro scandals -- is hampering development of banks' plans in the futures markets.

"The Fed is holding foreign banks hostage to whatever political process is at work, but it's the industry that's suffering," said one broker who declined to be named.

"Dellsher got lucky, but a lot of other companies dying for capital are seeing opportunities wither on the vine because the Fed is discouraging foreign banks from applying."

Mitsubishi Pulls Out of Deal

Confirming the increasing frustration over slow Fed approvals, Mitsubishi Trust and Banking Corp. last week withdrew its application to set up a joint venture with Chicago Research and Trading Group, a specialized options and futures trading firm, a spokesman for CRT confirmed Wednesday.

Mitsubishi, filed its application over a year ago and had hoped to eventually take a stake in the firm.

Trading in financial futures has grown rapidly in recent years as a growing number of companies seek to hedge foreign exchange and interest rate risks and as speculative trading in futures contracts has increased.

Foreign bankers say they are only following the lead of major U.S. banks in building up their operations.

Most foreign banks find buying an existing firm the most efficient way to build a presence in the sophisticated futures and options markets.

"This will give our customers quick, direct access to trading on the Chicago Mercantile Exchange," which pioneered the development of financial futures, said the Sakura official.

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