https://www.fintechfutures.com/wp-content/themes/fintech_child/assets/images/logo/fintech-logo.png
  • Home
  • COVID-19
  • News
  • Intelligence
    • Back
    • Analysis
    • Interviews
    • Features
    • White Papers
    • Case Studies
    • Surveys, Reports & Infographics
    • Webinars
    • Podcasts
    • Videos
    • Library
    • Techwire
    • Browse
  • Publications
    • Back
    • Banking Technology Magazine
    • Supplements
    • Daily News at Sibos
    • Subscribe to Magazine
  • Content Hub
    • Back
    • Diversity & Inclusion
    • COVID-19: Industry impact & response
    • Challenger Banks Guide
    • Food For Thought
    • I’m Just Saying
    • Through a Gen Z Lens
    • Vlog: It’s a matter of comms
    • Fintech Agony Uncle
    • Ask The Expert
  • Videos
  • WTF? Podcast
  • Awards
    • Back
    • Banking Technology Awards
    • PayTech Awards
  • Digital Events
  • Advertise
  • Jobs
  • More
    • Back
    • About us
    • Contact us
    • Advertising / Media Kit
    • Banking Technology Magazine Calendar
    • Reports Calendar
    • FinTech Futures Newsletter
    • Events
  • FinTech
  • BankingTech
  • PayTech
  • RegTech
  • WealthTech
  • LendTech
  • InsurTech
  • US Edition
    • Intl. Edition
Banking Technology
  • NEWSLETTER
  • Home
  • COVID-19
  • News
  • Intelligence
    • Back
    • Analysis
    • Interviews
    • Features
    • White Papers
    • Case Studies
    • Surveys, Reports & Infographics
    • Webinars
    • Podcasts
    • Videos
    • Library
    • Techwire
    • Browse
  • Publications
    • Back
    • Banking Technology Magazine
    • Supplements
    • Daily News at Sibos
    • Subscribe to Magazine
  • Content Hub
    • Back
    • Diversity & Inclusion
    • COVID-19: Industry impact & response
    • Challenger Banks Guide
    • Food For Thought
    • I’m Just Saying
    • Through a Gen Z Lens
    • Vlog: It’s a matter of comms
    • Fintech Agony Uncle
    • Ask The Expert
  • Videos
  • WTF? Podcast
  • Awards
    • Back
    • Banking Technology Awards
    • PayTech Awards
  • Digital Events
  • Advertise
  • Jobs
  • More
    • Back
    • About us
    • Contact us
    • Advertising / Media Kit
    • Banking Technology Magazine Calendar
    • Reports Calendar
    • FinTech Futures Newsletter
    • Events
  • US Edition
    • Intl. Edition
  • newsletter
  • FinTech
  • BankingTech
  • PayTech
  • RegTech
  • WealthTech
  • LendTech
  • InsurTech

bankingtech.com

bankingtech.com


BATS rejects compromise: calls for $1 billion US exchange fee cut

  • Written by FinTech Futures
  • 8th January 2015
BATS chief executive Joe Ratterman has called for major cuts in US exchange fees

BATS chief executive Joe Ratterman has called for cuts in US exchange fees

US exchange BATS Global Markets is calling for an 80% reduction in access fees to the US stock market’s most liquid securities, on grounds that nearly a billion dollars in fees could be slashed without adversely affecting the market. In an open letter to the industry, the exchange also rejected what it calls a “grand compromise” on exchange fees and called for greater transparency and the avoidance of anti-competitive rules.

BATS operates two main exchanges in the US, and has recently also become a regulated exchange in Europe. The origin of BATS’ proposals have to do with the increasing automation of securities markets and the proliferation of different trading venues over the last decade. In particular, BATS cites concerns about the amount of trading done away from the displayed exchanges, and complaints about the incentives received by brokers for routing orders to one destination over another.

These issues have led to a body of opinion in the industry calling for a trade-at prohibition, which would force order flow to the exchanges, in exchange for a decrease in access fees and a ban on exchange rebates for most market participants. Specifically, US regulator the SEC has been considering the trade-at rule since April 2014 – a measure which has been advocated by exchanges NYSE and Nasdaq for years on the grounds that it would help them to fight back and regain market share from competitor venues such as broker-run dark pools.

In its open letter to the industry, BATS rejects this “grand compromise”, on the grounds that while exchanges would stand to benefit from increase volume directed to them, and brokers would benefit from a reduction in exchange fees, investors would likely pay more both in the form of potentially wider spreads as well as fewer and inferior execution choices. Instead, the exchange claims that the introduction of tiered market access fees, depending on each security’s average daily volume, could save $850 million annually in the 200 most actively traded US stocks. BATS proposes the fees should begin at $0.0005 per share.

The exchange is also calling for greater order handling transparency and higher standards for small trading centres. The exchange says that alternative trading systems should be required to provide their rules of operation to customers, and Rules 605 and 606 of Regulation NMS should be amended to require additional disclosure of achieved execution quality on a broker by broker basis. Reg NMS should also be revised, BATS says, so that until an exchange or other protected market centre achieves greater than 1% share of consolidated average daily volume in any rolling three-month period, it should no longer be protected under the trade-through rule, and not share in any NMS plan market data revenue. The idea is to address the concerns of market participants that the current structure may artificially subsidise competition and encourages excessive complexity in the market.

“While the highly efficient, fair and transparent US equity market is widely viewed as the world’s most competitive market, a one size fits all approach may no longer best meet the needs of end investors, issuers and the industry’s many participants,” said Joe Ratterman, chief executive at BATS. “The market has long been defined by its continuous quest for improvement, and we believe that a material reduction in access fees for the most liquid securities, coupled with an intelligently tiered approach for less liquid stocks, is an excellent place to begin.”

BATS has called on the industry to respond to its open letter and to petition US regulator the Securities and Exchange Commission to accept its proposals.

Tags: Stock Exchange, Trading Technology BATS, Reg NMS News USA

Leave a comment Cancel reply

-or-

Log in with your FinTech Futures account

Alternatively, post a comment by completing the form below:

Your email address will not be published. Required fields are marked *

Related


  • WorldRemit founder Ismail Ahmed launches $500m Somaliland fund
    WorldRemit’s first market was Somaliland.
  • UK energy provider Octopus launches Moneycoach
    It intends to invest £10 million into Moneycoach to scale the offering.
  • Ikano Bank picks TruNarrative to sit at regulatory centre of digital change
    Swedish bank selects UK regtech firm to collate AML programmes.
  • US core banking vendor Nymbus sets up new business for credit unions
    “Credit unions have an immediate opportunity to leverage niche digital banking approaches".
  • Airtel Africa sells 25% stake in mobile money arm to Mastercard for $100m
    Airtel Africa hopes to list the mobile money business as a separate entity.
  • Stripe takes first step into Middle East with UAE expansion
    Digital payment transactions in the UAE during 2020 reached $18.5 billion.
  • Clubhouse introduces tipping for content creators with Stripe
    The one-year-old start-up has raised around $100 million to date.
  • CaixaBank may cut up to 8,000 jobs after Bankia merger
    The bank will start negotiations with labour unions just after Easter.

Related Content

  • Video: Top fintech stories this week - 02 April 2021
  • ICYMI funding round-up: Butter, Spiral, SadaPay, OVEX, Ensemble & more
  • Global fintech M&A round-up Q1 2021
  • Top 10 funding rounds in Q1 2021

Dock - virtual roundtables

Dock is free to attend for banks and FIs

Click here to register

Sponsorship opportunities available at Dock

Click here for more info

Magazine

Banking Technology April issue out now

8th April 2021

Banking Technology March issue out now

12th March 2021
view all

Webinars

Webinar: Getting to market faster by outsourcing PCI compliance

23rd March 2021

Webinar: Balancing app innovation and cybersecurity in financial services

5th March 2021

Webinar: How to stop massive mobile banking fraud with app security and risk-based authentication

9th February 2021
view all

Reports & Surveys

FinTech Futures Industry Survey & Report 2021

4th March 2021

Report: The power of data analytics in fintech solutions

25th February 2021

Omdia Universe 2020-21: Temenos recognised as a leader for digital banking platforms

15th December 2020

Report: Digital KYB – a springboard to customer onboarding success

30th November 2020
view all

Content Hubs

Diversity & Inclusion Hub

9th April 2021

Dear Luc: your most pressing fintech problems solved by our Agony Uncle

8th April 2021

Vlog: It’s a matter of comms

30th March 2021

COVID-19: industry impact & response

26th June 2020
view all

Podcast

What the Fintech? | S.2 Episode 8 | Bank branches amid COVID-19

8th April 2021

What the Fintech? | S.2 Episode 7 | Class is in session

19th March 2021

What the Fintech? | S.2 Episode 6 | Open banking on the loose

5th March 2021
view all

Videos

Video: Top fintech stories this week – 9 April 2021

9th April 2021

It’s a matter of comms | Episode 3 | ESG

23rd March 2021

Video: Top fintech stories this week – 18 March 2021

21st March 2021

It’s a matter of comms | Episode 2 | Strategy

  • 1
2nd March 2021
view all

White Papers

Embedded insurance: a $3tn market opportunity, that could also help close the protection gap

4th January 2021

White paper: The business value of ServiceNow for retail banks

12th December 2020

E-book: Migration to cloud – your guide to delivering an intuitive customer experience

8th December 2020

White paper: Re-wiring financial services operations for a bold future

7th December 2020
view all

Techwire

Temasek and BlackRock Launch Decarbonization Investment Partnership

12th April 2021

Citi’s Digital Channels Process One Billion API Calls From Corporate Clients

12th April 2021

Charles River Development Wins 2021 FinTech Breakthrough Award

12th April 2021

Citi, Bank of America to Lead Development of Independent Data and Execution Platform

12th April 2021

American Cycle Finance Selects Scienaptic’s AI-Powered Credit Decisioning Platform to Grow Second-Chance Motorcycle Loans Business

12th April 2021

TurnKey Lender and Globe Telecom Partnership to Fulfill Thousands of Loan Requests Per Day to Serve More Filipino Customers in Need

12th April 2021

Juniper Research: Facial Recognition for Payments Authentication to Be Used by Over 1.4 Billion People Globally by 2025

12th April 2021

Deep Knowledge Analytics Founder to Release New Book in Q3 2021: ‘Longevity Politics – Longevity as the New Political Priority of the 21st Century’

9th April 2021
view all

Twitter

FinTech_Futures

Keep the change: how fintech is blurring the line between transaction and payment "As payments become more frictio… twitter.com/i/web/status/1…

12th April 2021
FinTech_Futures

.@InnFin CEO Crosswell steps down fintechfutures.com/2021/04/innova…

12th April 2021
FinTech_Futures

.@moneycorp continues exec shake-up with new ex-Vocalink vice chairman fintechfutures.com/2021/04/moneyc…

12th April 2021
FinTech_Futures

German challenger for 15-24-year-olds @pockid_money launches this month fintechfutures.com/2021/04/german…

12th April 2021
FinTech_Futures

.@minnatech recruits Tiama Hanson-Drury as new product officer fintechfutures.com/2021/04/minna-…

12th April 2021
FinTech_Futures

.@EMLpayments acquires open banking brand @NUAPAY in €110m deal fintechfutures.com/2021/04/eml-pa…

12th April 2021
FinTech_Futures

.@TideBusiness signs deal with @rblbank to underpin Indian expansion fintechfutures.com/2021/04/tide-s…

12th April 2021
FinTech_Futures

France's central bank [@banquedefrance] warns fintech industry of rules when using term 'neobank' fintechfutures.com/2021/04/france…

12th April 2021

Dock: virtual roundtable experience like no other

18-19 May 2021; FREE TO ATTEND

US Challenger banks: who's who & what's their tech

Free to read

FinTech Futures Industry Survey & Report 2021

A deep-dive into the trends defining 2021 and beyond. FREE DOWNLOAD

Free webinar: Getting to market faster by outsourcing PCI compliance

22 April 2021, register today!

Fintech Futures
  • About us
  • Advertise with us
  • Contact us
  • Fintech jobs
  • Privacy
  • CCPA: “Do Not Sell My Data”
  • Cookies Policy
  • Terms
Copyright © 2021 Informa PLC. Informa PLC is registered in England and Wales with company number 8860726 whose registered and Head office is 5 Howick Place, London, SW1P 1WG.
This website uses cookies, including third party ones, to allow for analysis of how people use our website in order to improve your experience and our services. By continuing to use our website, you agree to the use of such cookies. Click here for more information on our Cookie Policy and Privacy Policy.
X