Fitch Ratings has affirmed CME Group, Inc.'s (CME) Long-Term Issuer Default Rating (IDR) at 'AA-' and Short-Term IDR at 'F1+'.

The Rating Outlook is Stable. Fitch has also affirmed CME's unsecured debt rating at 'AA-' and commercial paper (CP) rating at 'F1+'.

Key Rating Drivers

The rating affirmations reflect CME's very strong market position in global exchange-traded derivative (ETD) trading and clearing services, exceptionally strong and stable profitability margins, a long operating history, experienced management team, prudent counterparty risk management in clearing operations and limited use of leverage.

The ratings are constrained by the company's limited product offerings outside of ETDs, and higher reliance on volume-based trading and clearing revenue compared to peers, which is partially mitigated by the diversity of asset classes and market leading underlying core ETD offerings.

CME maintains leading positions as a provider of exchange and clearing services in a broad array of ETD classes with dominant market shares in interest rates, equity index, commodities, and foreign exchange, reinforced by the integrated clearing function (CME Clearing), which provides material risk management and liquidity benefits for its members. Data and information services, which are largely subscription-based, were about 12% of revenues for the trailing 12 months (TTM) ended 3Q23, and may result in higher revenue volatility relative to other large vertically integrated exchanges with a larger proportion of data and information revenues.

CME has one of the strongest profitability margins in the industry, demonstrated through a variety of operating cycles. The adjusted EBITDA margin was 71.0% in TTM ended 3Q23, slightly higher than the prior four-year (2019-2022) average of 69.5%, and commensurate with Fitch's 'aa' category and above earnings and profitability benchmark range of 50% or higher for financial market infrastructure (FMIs) firms. In 2023, margins were aided by record traded volumes, supported by strong cost discipline. Fitch believes CME's partnership with Google LLC could provide additional operational efficiencies long term, help CME access new client pools and expand data and analytics services.

The company's leverage levels have historically been conservative relative to those of its more acquisitive peers. Fitch estimates cash flow leverage, as expressed by gross debt/adjusted EBITDA, at around 0.9x at 3Q23, which is within Fitch's 'aa and above' category capitalization and leverage benchmark range for FMIs of less than 1.0x. Leverage was also in line with CME's publicly articulated target of 1.0x or below.

Fitch views CME's predominantly long-term funding profile and demonstrated ability to raise long-duration debt favorably. CME has no near-term maturities with the next note maturity in March 2025 and the vast majority of maturities in 2027 or thereafter. CME has an active CP program, which is back-stopped by a $2.3 billion multi-currency revolving facility expiring in November 2026. CME also has access to a $7.0 billion secured revolving facility to be used in certain situations by CME Clearing. Both of CME 's credit facilities were unutilized at 3Q23.

Liquidity is strong, as CME held $2.3 billion in corporate cash and equivalents at 3Q23. CME Clearing's cash performance bonds and guaranty fund contributions were $87.2 billion at 3Q23 and were held in highly liquid instruments. Interest coverage (Adjusted EBITDA to interest expense) was 23.8x for TTM ended 3Q23, higher than the four-year average of 20.1x, and within Fitch's 'aa' category benchmark of greater than 15x for FMIs.

CME is exposed to significant counterparty risk through CME Clearing. At 3Q23, CME Clearing's total initial margin requirement was $228.6 billion, somewhat higher than YE22 driven by heightened market volatility. CME Clearing mitigates its counterparty risks through a robust margining process, counterparty due diligence, collection of guaranty fund contributions and assessment powers. Fitch views CME Clearing's counterparty risk management tools as effective, as evidenced by limited historical member default losses and minimal reported initial margin back-testing breaches.

CME is also exposed to material operational risks, related largely to potential model and/or system failures as a result of the significant volume of processed and cleared transactions, which could be amplified by the ongoing transition to the CME Span2 margin model and/or continued migration of core services to the Google Cloud platform. These risks are mitigated by a robust recovery infrastructure and CME's prudent phased approach to testing and implementation.

The Stable Outlook reflects Fitch's expectation that CME will retain its dominant positions within the ETD space, while maintaining strong profitability through operating cycles and a moderate risk profile. The Stable Outlook also incorporates Fitch's expectation that CME will manage its leverage at or near its long-term target of 1.0x or below.

The Short-Term IDR reflects the strongest intrinsic capacity for timely repayment of financial commitments and maintains the correspondence between Short- and Long-Term IDRs, as a Long-Term IDR of 'AA-' or higher corresponds to a Short-Term IDR of 'F1+' under Fitch's Non-Bank Financial Institutions Rating Criteria.


Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade

A material deterioration in market shares, operational failures or reputational damage; adverse changes in risk profile, as reflected in large-scale acquisitions, which entail meaningful integration/execution risk and/or loosening counterparty risk management standards, leading to the use of mutualized guaranty funds; repeated or outsized operational losses, including those caused by the transition to the CME SPAN2 margin model or the migration to the Google Cloud platform; an inability to adapt to regulatory changes; or incremental debt issuances that result in a sustained increase in leverage at or above 1.5x could lead to negative rating action.

Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade

Fitch views standalone ratings upside as somewhat limited, given the operational risks inherent in the business, as well as the fact that CME is amongst the highest rated non-bank financial institutions globally. However, greater diversification of business activities, which serves to add further stability to revenue and earnings generation without introducing outsized integration or operational and execution risks; sustained leverage below 0.5x, on a gross debt to adjusted EBITDA basis; and consistent effective management of operational risk, including continued demonstration of limited operational losses and sound system availability performance would be viewed favorably.


The unsecured debt rating and CP rating are equalized with CME 's Long- and Short-Term IDRs, respectively, reflecting CME 's fully unsecured funding profile and Fitch's expectation for average recovery prospects in a stress scenario.


The unsecured debt rating is primarily sensitive to changes in CME Group's Long-Term IDR, and secondarily, to changes in Fitch's assessment of the recovery prospects of the debt class. Likewise, the CP rating is sensitive to changes in the Short-Term IDR.


The Capitalization & Leverage score has been assigned below the implied score due to the following adjustment reasons: Historical and future metrics (negative).


The principal sources of information used in the analysis are described in the Applicable Criteria.

ESG Considerations

The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit

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