Friday 30th January 2015
NEWS TICKER: THURSDAY, JANUARY 29TH 2015: Following a recent Morningstar Analyst Ratings meeting, Morningstar has moved the Morningstar Analyst Rating™ of the Aviva Investors Global Convertibles fund to Neutral. The fund was previously Under Review following the departure of co-managers David Clott and Shawn Mato. Prior to being place Under Review, the fund was rated Bronze. London-based co-manager, Justin Craib-Cox, who was running the fund alongside the duo has since been appointed lead manager. Craib-Cox was previously responsible for European convertibles and Morningstar is concerned by the considerable increase in his workload, which is only partly alleviated by increased support from Aviva’s equity and credit teams. The company is looking to recruit additional convertibles specialists, however, Morningstar’s limited visibility on the ultimate structure of the team, combined with Craib-Cox’s workload, lead Morningstar to a Neutral rating -Japan Airlines (JAL) has firmed up an order with Mitsubishi Aircraft for 32 MRJ regional jets, having signed a letter of intent in August 2014. The carrier will deploy the MRJs from 2021, to be operated by its wholly-owned regional subsidiary J-AIR, says JAL and Mitsubishi Aircraft in a joint statement - The Securities and Exchange Commission today announced that Robert E. Rice, Chief Counsel to Chair Mary Jo White, will leave the agency at the end of February. Chair White named Rice her chief counsel in June 2013. “Bob is one of the brightest and finest professionals I have ever known,” said SEC Chair Mary Jo White. “I relied on his impeccable judgment on a variety of important enforcement and regulatory issues, and I am very grateful to him for his service to the agency and to me.” Before coming to the SEC, Mr. Rice worked from 2004 to 2013 at Deutsche Bank AG in New York, where he oversaw all regulatory and criminal enforcement, litigation and governance matters in the Americas, and was the global co-head of the bank’s Governance, Litigation and Regulation Operating Committee. From 2000 to 2004, Mr. Rice was a partner at McDermott, Will & Emery in New York, where he concentrated his practice in white collar regulatory and criminal defense matters on behalf of corporate entities and corporate officers and directors. - The Federal Deposit Insurance Corporation (FDIC) issued a Financial Institution Letter yesterday encouraging supervised institutions to take a risk-based approach in assessing individual customer relationships, rather than declining to provide banking services to entire categories of customers without regard to the risks presented by an individual customer or the financial institution's ability to manage the risk. The FDIC also reinforced the agency's policies on managing customer relationships to examiners and other supervisory staff. Financial institutions that properly manage customer relationships and effectively mitigate risks are neither prohibited nor discouraged from providing services to any category of customer accounts or individual customers operating in compliance with applicable laws. FDIC examiners must provide notice in writing for any case in which an institution is directed to exit a customer relationship - US mid-market investment bank BR & Co says it will release results for the fourth quarter and full year of 2014 before the market opens on Wednesday, February 11th -.Chile’s Minister of Economy, Development and Tourism, Luis Felipe Céspedes, along with General Manager Sercotec Bernardo Troncoso, made ​​a visit to the antique del Barrio Italy yesterday to introduce new programs for productive development that will display Sercotec for entrepreneurs , micro and small businesses during 2015 - Moody's de Mexico has upgraded debt ratings to Baa1 (Global Scale, local currency) from Baa2 and to Aaa.mx (Mexico National Scale) from Aa2.mx of the following five enhanced loans to the state of Chihuahua: MXN4.5bn from Banco Interacciones (original face value) with a maturity of 20 years; MXN1.38bn from BBVA-Bancomer (original face value) with a maturity of 20 years; MXN 2.03bn from BBVA-Bancomer (original face value) with a maturity of 20 years; MXN1.72bn from BBVA-Bancomer (original face value) with a maturity of 20 years; MXN3bn from Multiva (original face value) with a maturity of 17 years (MXN1.4bn disposed of). The ratings agency also assigned debt ratings of Baa1 (Global Scale, local currency) and Aaa.mx (Mexico National Scale) to the following enhanced loans: MXN1.995bn from Banorte (original face value) with a maturity of 20 years; MXN1bn from Santander (original face value) with a maturity of 20 years. All the enhanced loans are payable through a master trust (Evercore as trustee F/0152), to which the state has pledged the flows and rights to 56.98% of its federal participation revenues. All the loans under this master trust share the cash flow and are paid on a pari passu basis. - The January monthly energy review by the EIA was released yesterday evening. Preliminary estimates of US residential energy consumption suggest that for October 2014 total energy consumption equaled 1.3 quadrillion Btu, a 2% decrease from October 2013. Electricity retail sales and electrical system energy losses accounted for 73% of residential sector total energy consumption, while natural gas accounted for 16% of residential sector total energy consumption, renewable energy accounted for 6%, and petroleum accounted for 5% - Celent has released a new report, titled, IT Spending in Banking: A North American Perspective. The report is authored by Jacob Jegher, a research director with Celent's Banking practice. North American IT spending growth is rising steadily, he says, and is expected to be 4.5% higher in 2015. Growth will drop slightly in 2016 as IT spending by North American banks reaches US$64.8 billion, an increase of 4.2%. In the report, Celent examines, analyses, and contrasts the IT spending patterns of US and Canadian banks. The firm says North American bank IT spending will grow from $59.5bn in 2014 to $62.2bn in 2015. This year, the firm adds, is shaping up to be another promising one for retail banking; significant funds are still required to move forward and maintain self-service initiatives, digital banking projects/overhauls, branch transformation initiatives, and omni-channel endeavours. Additionally, mobile banking will continue to receive significant attention as banks aim to build on existing smartphone and tablet apps. Analytics, omni-channel banking, compliance/regulatory, and IT security investments will also be priorities. Spending on corporate banking will continue to climb through new component or module-based initiatives. Midsize banks are still very much looking to compete with larger banks that have invested significant amounts over the last several years. Small business is also a growing area of interest because banks still haven't figured out how to attack this distinct and attractive market segment. "The figures point to another strong year; 2015 is poised to build on the growth experienced last year," says Jegher. – The CME Group advises that the deadline to claim a SMART Click ID for GPS and BPS will be February 6th, 2015. After this date, there will no longer be an option to login with a Legacy ID and both applications will only be accessible with a SMART Click ID. Applicants can create a SMART Click ID (if you do not have one already) or claim your Legacy ID via the GPS and BPS portals and both applications must be claimed independently prior to the deadline. The CME says that after February 6th, the GPS and BPS applications will no longer be available via the CME Portal. These applications will only be available via ‘direct’ links following direct links: https://gps.cmegroup.com; https://bps.cmegroup.com; and https://login.cmegroup.com - China’s debt build up since the global financial crisis ranks as one of the largest in recent history (in the 97th percentile of debt-to-GDP changes in a sample of 55 countries over the past 50 years) according to Goldman Sachs’ latest Global Economics Weekly research report. The bank says the development is new and is a major global macro concern for investors. Deteriorating external conditions and declining investment efficiency have contributed to the debt build-up. The research team says that while the risk is significant, its analysis exploring the aftermath of large debt build-ups over the past half-century suggests that credit booms do not always end in deep recessions or banking crises. “GDP growth typically decelerates by at least 3-4pp after credit booms, although in China’s case some slowing has already occurred. Smoothing the adjustment process is likely to require increased central government fiscal outlays and policy interest rates should remain fairly low,” says the team. They add that while Chinese policy-makers have begun to address credit issues, significant imbalances still need to be worked off and capital market system development and reforms still need to be implemented more fully -

Is your compliance program adequate to the task?

Monday, 05 March 2012
Is your compliance program adequate to the task? In the face of a changing regulatory environment it is important for you to determine that your compliance program is adequate to protect you and your firm. The following questions are designed to identify factors that are important to an effective and robust compliance program. Honestly answering the following questions is the first step in making this assessment. http://www.ftseglobalmarkets.com/

In the face of a changing regulatory environment it is important for you to determine that your compliance program is adequate to protect you and your firm. The following questions are designed to identify factors that are important to an effective and robust compliance program. Honestly answering the following questions is the first step in making this assessment.

Culture of Compliance

Key questions:



1. Does the management team, as well as the investment personnel, believe that  governance processes are important and understand the legal and regulatory requirements  impacting their roles?
2. Does your chief compliance officer have respect and influence in your organisation?
3. Do risk and compliance personnel raise issues to you (or your senior management team) for consideration, even when the issues concern a major profit centre?

If you answered “No” to any of these questions, you are at risk of not realising that something has gone awry until it is too late. You must manage regulatory and legal issues just as closely as you would manage financial challenges

Organisational Structure

Key questions:

1. Does your chief compliance officer have direct access to your governing board or executive committee?
2. Have you
  (i) identified the laws that apply to your company, your investment vehicles, and your investments, and
  (ii) have you incorporated these requirements into operational processes?
3. Is there a process for keeping the information gathered in #2 up-to-date reflecting both changes to laws, changes to the market place, and new activities?

If the answer is “No” to any of these questions, you need to build these processes now.

Compliance Manual

Key questions:

1. Is your compliance manual tailored to your business?
2. Is it meaningful to you and your staff so that you use it to obtain guidance in unusual or tricky situations?
3. Do the investment personnel appreciate the importance of the policies and procedures that apply to them?

If you answered “No” to more than one of these, you probably do not have satisfactory compliance manual in place.


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