CHICAGO (Reuters) - The clearinghouse for all U.S. stock options on Wednesday named Craig Donohue, former chief executive officer for CME Group Inc, as its new executive chairman.
Donohue will assume the role at OCC, formerly known as Options Clearing Corp., on January 1 following the expiration of an agreement that bars him from competing with CME until the end of the year.
The move puts Donohue back on top of a Chicago-based financial firm after he resigned from CME last year following 23 years with the world’s largest futures exchange operator, including eight years as CEO.
He will join OCC as U.S. exchange-operators cope with technology issues that have caused a series of trading outages and malfunctions this year.
OCC has nearly 120 clearing members that include the biggest U.S. broker-dealers, futures commission merchants and non-U.S. securities firms. A source in July said Donohue had been in talks to become chairman.
“Broadly speaking, all financial markets are still in the process of adapting to the transformation that has happened over the last decades in terms of a greater degree of electronic trading,” Donohue said in an interview.
Options trading was halted sporadically across all U.S. markets on Monday due to an unexplained issue with the system that distributes price quotes.
The stoppage came after U.S. exchanges officials last week pledged to ramp up efforts to safeguard systems and prevent technology failures after a meeting with Mary Jo White, chairwoman of the U.S. Securities and Exchange Commission.
The SEC meeting was in response to a software bug that caused a three-hour outage in all Nasdaq-listed stocks on August 22 after a securities information processor (SIP) malfunctioned.
On Friday, trading on two of CBOE Holdings Inc’s securities exchanges was halted for more than half an hour due to unidentified technical problems.
Donohue had little interaction with market regulators at the SEC, which is OCC’s main regulator, when he was chief of CME. CME’s main regulator is the Commodity Futures Trading Commission.
“I have a substantial amount of experience but at the same time this is a learning opportunity for me,” he said of his new job.
CME paid Donohue $6.1 million in 2012, making him the company’s highest-paid executive even though he held the chief executive post for only the first four months of the year, according to a regulatory filing.
He will replace OCC Chairman and CEO Wayne Luthringshausen, who will retire at the end of the year after 36 years as chairman. The company is separating Luthringshausen’s roles.
Michael Cahill, OCC’s president, chief operating officer and treasurer, will become chief executive on January 1.
“I’ve already had a very important CEO role before so it’s nice to have a chairman role,” said Donohue, who has been spending time with his family since leaving CME.
Reporting by Tom Polansek; Editing by James Dalgleish and Jim Loney