Regulation is driving a structural shift away from capital markets and investment banking towards transaction banking – but even this hint of opportunity could be under threat, according to senior financial services panellists speaking at the BAFT IFSA conference in London this week.
Tuesday’s landmark deal between the European Parliament, Council and Commission on MiFID II will hurt long-term investors and may paint the regulator into a corner, according to Juan Pablo Urrutia, European general council at broker ITG.
Reforms to the way derivatives trade in the US and Europe are causing a conflict between consumer desire for bespoke solutions and regulatory attempts at standardisation – and the self-inflicted panic as the deadline approaches indicates the cost may be too high, according to a panel of senior capital markets representatives speaking at an event organised by the Futures and Options Association in London on Tuesday.
Most banks are still not ready for the arrival of Swap Execution Facilities, the new category of trading venues created by the Dodd-Frank act in the US to handle OTC derivatives. Worse still, market participants are almost universally negative about SEFs, according to a new paper by research house GreySpark Partners.
The data management aspects of compliance can run into tens of thousands of man-hours per institution, each year. Firms have to adapt and find new techniques to manage this increasing burden.
Former SunGard chief executive Cris Conde writes about the importance of training in firms’ governance, risk management and compliance strategies and why they should treat it as an investment.
As Europe’s post-trade infrastructure is subjected to increasing levels of regulation, CSDs will be forced to change their business models to stay alive, custodians will be forced to seek alliances to find economies of scale, and brokers will have to outsource parts of their mid and back office processes to stay in the game, according to analyst firm Celent.
MiFID II is almost upon us. Expect it to be the topic of conversation very soon. So what do you need to know about it?
Conduct risk is gaining teeth, and with MiFID II on the way it’s set to gain a whole load more. But there is just one problem: nobody quite agrees on what conduct risk means or where its boundaries are set.
A surprisingly high proportion of US banks are still not prepared to comply with Dodd-Frank’s regulations on swaps, despite the impending arrival of mandatory trading on swap execution facilities, according to Charley Rich, vice president of product management at tech firm Nastel.
Firms like JP Morgan and HSBC have taken major measures to improve internal controls so that they can comply with new and changing regulations. It won’t end there.
UK operator EE has launched mobile voice recording services to help UK organisations to fully comply with the FCA’s mobile trading regulations.
Sapient Global Markets has released a suite of software and services designed to help companies meet FATCA, the controversial new US regulation that obliges banks to report their US customers so that they can be taxed.
What do hundreds-of-thousands of counterparties, dozens of regulations and your many regulators all want from you? Better counterparty classification …
Here’s what you don’t know about how the European Parliament is going to stretch your time and budget in 2014 …
Bloomberg has received approval to launch a Swap Execution Facility, ahead of the compliance deadline for new US Dodd-Frank rules for clearing of OTC derivatives.
Is there anything to fear about the new FCA? Well, possibly quite a lot, it would seem. A hundred or so days into the new era of the FCA and it would be hard for anyone in the wealth management or private banking sector to have missed the message that the regulation of the sector is going to be different from now on.
For firms who remember MiFID I, and those that don’t, round two is almost upon us. This month, the Council of the EU agreed their general approach, meaning that the draft of MiFID II/MiFIR is free to advance to the European Parliament. If all goes according to the current plan, the new combined legislation will be with us in time for 2015 implementation.
If your role has anything to do with governance, risk and compliance or with international tax agreements, then you’ll be familiar with the United States Foreign Account Tax Compliance Act and the potential impact on many of the world’s financial institutions …
With six months before the 4th Capital Requirements Directive comes into force, many will be asking what technological improvements will be necessary to efficiently manage risk going forward. Before they embark on a costly overhaul of their data systems, firms should look at what regulatory trends are likely to require similar changes in the future and adjust their specification accordingly.
Delays to the controversial US FATCA rule have provided a valuable window of opportunity for financial institutions to prepare.
After a long wait, the first real FATCA implementation deadlines are just around the corner. To meet the new account identification requirements, by 1 January 2014, institutions should be in the process of implementing the necessary upgrades in their onboarding and overall compliance systems and processes.
Regulators are busy raising the bar for KYC systems and controls. With conflicting purposes and customer data objectives, new guidance and industry solutions are needed in 2014
Recent months have seen rising tensions over the seemingly insurmountable demands for collateral prompted by tough new financial regulation. With US Treasury estimates ranging as high as to $11.2 trillion in stressed market conditions, some observers are deeply concerned that the industry could be in danger of sliding into a black hole
Financial technology company SunGard has released a new tool designed to help banks and other financial institutions to streamline their compliance with regulation, reduce their costs and control risk.
The UK financial services sector has asked new regulator the Financial Conduct Authority to do more to support competition, improve its communication with the industry and provide clearer and more predictable regulation, according to a the results of a survey published by the FCA today.
Banks can breathe a sigh of relief following the publication of amendments to US Dodd-Frank Rule 1073 today, which should allay fears that draconian regulation was about to stifle cross-border payments.
Regulators in the UK are concerned that some European governments will force through regulations that will close off legitimate market practices such as algorithmic trading because they do not fully understand the markets, said a panellist at the TradeTech event in London. Tim Rowe, head of the trading platforms and settlement team at the UK’s […]
While HFT may pose a real threat to market stability, the European Commission’s response has been woefully inadequate and shows a lack of understanding of the core issues, says professor Dave Cliff of the University of Bristol and former member of the UK government’s Foresight Project.
Post-trade services company Traiana has opened its Swap Data Repository Service, Harmony TR Connect, for OTC derivatives – providing a tool for market participants to comply with US Dodd-Frank legislation on trade reporting.
As tough new rules requiring the collateralisation of OTC derivatives take hold in Europe and the US, Citi has retooled its OpenInvestor investment services to include segregated collateral custody accounts – a move the bank says will help mitigate counterparty risk and improve collateral efficiency.
Social media can add value for banks, but they need to be careful that the risk of damaging their brand does not outweigh the potential benefits, according to Jaroslaw Knapik, senior analyst, financial services technology at Ovum.
Bank of America Merrill Lynch has launched a service aimed at helping smaller banks to cope with Dodd-Frank rules for US cross-border trades.
In future, the possibility of a bank failure will be accepted as a normal market process, and barriers to entry for new start-ups, including a removal of capital requirement obstacles, will be removed, the Financial Services Authority and the Bank of England have confirmed.
They were never going to be happy in Switzerland about the US FATCA legislation that will be used to hunt down people avoiding US taxes, but it’s a surprise to hear that some Swiss burghers are feeling sorry for a group of US citizens who have become part of the fabric of society there.
FATCA compliance might not need a separate programme – it ought to be covered by the same approach as AML, RDR and KYC regulations, among others.
As the deadline for mandatory swaps reporting approaches for more and more asset types, US post-trade services utility the DTCC has announced that swaps dealers are now submitting OTC derivatives trade information for all five major asset classes into its US swaps data repository, DDR.
With the January 2014 deadline looming on the horizon, financial organisations are realising that fast action is needed, and needed now, in order to be able to meet the first FATCA deadline for new account on-boarding.
Financial services firms are being forced to become increasingly risk-focused due to the continuing pressure of regulation, according to a new survey by Thomson Reuters.
On February 28, most of the approximately 70 registered swap dealers will stumble across the finishing line for the remaining asset classes of the CFTC implementation of Dodd-Frank trade reporting regulations. Some may be forgiven for breathing a sigh of relief.
