Add-backs’ stoke fears of distorted credit ratings

By Joe Rennison November 8, 2019, Financial Times In the middle of the boom in leveraged loans last year, ratings agency S&P Global forecast a bright future for 24 Hour Fitness, a California-based chain of gyms. As part of...

Asset management: how safe is your job?

By Jennifer Thompson November 9, 2019, Financial Times Will your job exist five years from now, or even in 12 months? For most people working in fund management the answer has long been a resounding yes. full article

Fed’s repo operations will not fix rate spikes, dealers say

By Robert Mackenzie Smith November 7, 2019, Risk The U.S. Treasury repo is likely to remain volatile through the year-end and beyond despite the Federal Reserve’s efforts to stabilize overnight funding rates, according to rates specialists at two primary...

EMIR v. MiFID II: clearing and trading obligations align

By Alice Tchernookova November 7, 2019, Practice Insight from IFLR When the European Market Infrastructure Regulation (EMIR) refit was introduced earlier this year, the lack of clarity as to how it aligns with MiFID II was a major concern,...

Industry has lost interest in MiFID II

By Hugo Bromley November 6, 2019, Practice Insight from IFLR After two years of fervor over the implementation of MiFID II, interest has now begun to decline across the industry as firms wait for a number of regulatory reviews,...

JP Morgan Deal Shows Possible Path to Smaller Fannie and Freddie

By Sam Goldfarb November 8, 2019, The Wall Street Journal A recent move by JP Morgan Chase & Co. to shed risk on some of its mortgage loans is stirring hope that the tactic could help reduce the government’s...

Fannie, Freddie government lifeline cut could cause economic pain: DoubleLine

By Megan Davies and Kate Dugid November 7, 2019, Reuters The Trump administration’s aspiration to end government control of Fannie Mae and Freddie Mac is unlikely to be realized anytime soon, and any weakening of the long-standing government backstop...

Banks, funds propose shorter trading day in Europe, bourses split

By Huw Jones November 6, 2019, Reuters Banks and fund managers want the European stock trading day shortened by 90 minutes in a radical move they say would improve market efficiency and staff wellbeing – but exchanges are split....

SEC calls out conflicts of interest in TDFs

By Greg Iacurci November 7, 2019, InvestmentNews The Securities and Exchange Commission took aim at conflicts of interest in target-date funds on Thursday, calling out a fund structure that holds the majority of 401(k) investors’ assets. The agency’s Office...

ETF Rule Reform Becomes a Boon for Fixed Income

By Rob Daly November 6, 2019, Markets Media With a little more than a month since the U.S. Securities and Exchange Commission adopted its ETF Rule, the new rule has helped streamline exchange traded fund issuance and likely will...

Swaps market takes the lead on €STR transition

By Alice Tchernookova November 5, 2019, Practice Insight from IFLR Swap market users have taken the lead on the EU’s transition away from the euro overnight index average (Eonia) to the euro short-term rate (€STR), and some are hoping...

SEC chair questions like-for-like SOFR mapping

By Sharon Thiruchelvam November 5, 2019, Global Investor Group The Securities Exchange Commission (SEC) chair Jay Clayton has cast doubt on the potential for SOFR to definitively replace Libor, saying that “a like-for-like mapping of a Libor product to...

Use CDM, or some business lines might die – Barclays

By Ben St. Clair November 6, 2019, Risk Bloated post-trade expenses could put some business lines on the chopping block if the industry fails to innovate – in particular by adopting the common domain model (CDM) – and slash...

New York Fed CRO urges banks to improve risk controls

By Steve Marlin November 6, 2019, Risk Banks are choking under a proliferation of risk controls intended to help them prevent disruptions – rendering them more vulnerable to outside threats, not less, according to a senior risk manager at...

SEC Assesses Treasury Transparency and Integrity

By Rob Daly November 5, 2019, Markets Media The electronically traded U.S. Treasury market might be inching closer towards the cash equities markets regarding operational transparency and system integrity oversight based on a panel discussion held during the Securities...

All clear? Structural shifts add to repo madness

By Robert Mackenzie Smith November 5, 2019, Risk On September 17, rates on overnight repo, backed by the bedrock pledge of U.S. Treasuries, suddenly lurched to 10% from typically low single digits in a session that turned into a...

Market structure changes to shake up repo trading

By Joe Parsons November 6, 2019, The Trade Market structure changes such as the move to sponsored clearing and interest in electronic trading could significantly shake up the way repo trading is conducted by both buy- and sell-side firms,...

Dimon says problems like the repo lending crunch could happen ‘increasingly if we’re not careful’

By Jeff Cox November 5, 2019, CNBC The kinds of problems that sent short-term lending rates soaring in mid-September could happen more often if permanent fixes aren’t found, JP Morgan Chase CEO Jamie Dimon said Tuesday. Dollar funding constraints...

Repo ructions highlight failure of post-crisis policymaking

By Karen Petrou November 6, 2019, Financial Times A big failure of post-crisis financial policy was laid bare when the U.S. repo market buckled in September. Many have debated why the market went wrong, so fast. The Federal Reserve...

SEC grants three-year extension to MiFID II relief period

By Hayley McDowell November 5, 2019, The Trade U.S. brokers will be able to continue charging clients separately for research and analysis, as implemented under MiFID II in Europe, for another three years. The U.S. Securities and Exchange Commission...

MiFID II in the U.S.: Complexity cost

By Stephanie Scwartz-Driver November 1, 2019, IPE The E.U.’s MiFID II directive has quietly stirred up two kinds of challenges in the U.S.: the unbundling of trading commissions, particularly the payment for research; and then resolving who exactly is...

ESMA consults on commodity derivatives reforms

By James Langton November 5, 2019, Investment Executive The European Securities and Markets Authority (ESMA) issued a consultation paper today on its rules setting position limits in the commodity derivatives markets. These measures were introduced in an effort to...

China markets feel the pain of stalled derivatives rollout

By Samuel Shen and Alun John November 4, 2019, Reuters A long list of stock and currency derivatives has been lying in wait for regulatory approval at the China Financial Futures Exchange (CFFEX), some for nearly a decade. The...

Brexit ‘hubs’ face E.U. markets watchdog checks in 2020

By Huw Jones November 4, 2019, Reuters New European Union hubs opened by British-based financial firms to avoid Brexit disruption will be scrutinized next year by the bloc’s markets watchdog to check whether they are gaming licensing requirements. This...

Expect more money market jitters at year end: fund managers

By Megan Davies and Dan Burns November 4, 2019, Reuters Investors should expect another bout of money market volatility as the banking system’s year-end funding crunch approaches and the Federal Reserve has not arrived at a permanent fix for...

New York Fed Official Says Market Interventions Have Restored Calm

By Michael S. Derby November 4, 2019, The Wall Street Journal The New York Fed’s efforts to calm short-term markets and keep them placid is working well, a top central bank staffer said Monday. Lorie Logan, who is the...

Exploring the impact of regulation and FCM consolidation on liquidity

By Kirsten Hyde November 1, 2019, MarketVoice Despite the eye-catching title of the discussion – “Is there a liquidity crisis?” – a group of panelists at FIA Expo on Oct. 30 agreed that the industry has witnessed many innovations...

CFTC’s Tarbert vows to promote ‘integrity, resilience, and vibrancy’ of derivatives markets

By Will Acworth November 4, 2019, MarketVoice Heath Tarbert, the chairman of the Commodity Futures Trading Commission, said on Oct. 30 that he plans to move forward on several major rulemakings over the next six months, including speculative position...

Cloud adoption increasing in derivatives markets, industry experts say

By Kirsten Hyde November 1, 2019, MarketVoice Technology experts from four industry leaders — Amazon Web Services, CloudMargin, CME Group, and Trading Technologies — discussed the evolution of cloud technology in the derivatives markets at the FIA’s annual Futures...

LCH won’t back single fix for swaptions switch

By Robert Mackenzie Smith November 4, 2019, Risk Clearing house LCH will not develop an industry-wide method for compensating swaptions holders when the benchmark for interest rate swaps shifts to new risk-free reference rates next year. A senior figure...