Thursday 28th May 2015
NEWS TICKER: THURSDAY, MAY 28TH: A deal struck by MEPs and Council of Ministers negotiators in the small hours of Thursday morning means the architecture of the Juncker plan to unlock €315bn public and private investments in the real economy in 2015-2017 can now be put to a European Parliament vote on June 24th and the investment programme can kick off in the summer. Parliament’s negotiators scaled back cuts in the EU’s “Horizon2020” research and innovation programme and Connecting Europe Facility (CEF – to link up Europe’s energy, transport and digital networks). They also ensured that the plan creates a stable financing mechanism to bridge the investment gap in Europe, by clarifying the investment guarantee fund’s governance structure and making it more accountable to representatives of EU citizens – Jamyra Gallmon, accused of stabbing DLA Piper associate David Messerschmitt to death in a robbery gone wrong, pleaded guilty to murder today in Washington, DC court, after reaching a plea deal with prosecutors - – European banking and financial market associations have been rushing to comment on Tuesday night’s vote in the European Parliament’s Economic and Monetary Affairs Committee (ECON), which was rejected by 30 votes to 29, claiming they remain deeply concerned over the EU Banking Structural Reform proposal (BSR) that seeks to break up the largest European banks. The outcome of the ECON vote shows that there is no consensus on what is right for big universal banks in Europe. Policy makers suggest that the BSR proposal could lead to a loss in European investment capacity equal to 5%, representing a decline of almost €100bn in capital expenditure on the long term; however there does not seem to be any consolidated document that might form the basis of consistent debate as a European Parliament spokesperson confirms that the original proposal has had so many amendments that it scarcely reflects the original thinking behind the document. Given that the vote is defeated, the EP will not consider re-opening the debate until June 11th this year, when the Parliament will decide on the requirements for either further amendments or complete redrafting, or even abandonment of the proposal - )-- Murex, the leading provider of integrated trading, risk management and processing solutions, says UniCredit, which has the largest presence of banks in Central and Eastern Europe, has gone live on Murex' MX.3 for UniCredit Bank Austria and eight other Central Eastern Europe banks - The interim financial report of Gefinor S.A. (ISIN LU 0010016714) for the period ended March 31st is available on the company website at www.gefinor.com from May 28th (today) - The Securities and Exchange Commission today announced that the next meeting of its Advisory Committee on Small and Emerging Companies will focus on public company disclosure effectiveness, intrastate crowdfunding, venture exchanges, and treatment of finders.“The agenda reflects the important scope of the advisory committee’s mandate,” says SEC Chair Mary Jo White. “Topics I am particularly interested in are the advisory committee’s views on disclosure effectiveness and initiatives that will inform our capital formation efforts.” At its upcoming meeting on June 3rd, the advisory committee also is expected to vote on a recommendation to the Commission regarding the “Section 4(a)(1½) exemption” sometimes used by shareholders to resell privately issued securities. This topic was initially discussed at the committee’s March 4 meeting.The meeting will be held at the SEC’s headquarters at 100 F Street, NE, Washington, DC, and is open to the public. It also will be webcast live on the SEC’s website, www.sec.gov, and will be archived on the website for later viewing.

A streamlined approach

Friday, 15 June 2012
A streamlined approach The European asset management industry has grown considerably over the last ten years. Assets under management (AUM) stood at €3trn at the end of 2001, and had reached €7.89trn by the end of the second quarter (Q2) 2011. This growth, which will support the savings and retirement of a large portion of the European population, means asset managers have an enormous responsibility to their end clients. By Ann Doherty and Brian Coughlin, JP Morgan Worldwide Securities Services (WSS). http://www.ftseglobalmarkets.com/

The European asset management industry has grown considerably over the last ten years. Assets under management (AUM) stood at €3trn at the end of 2001, and had reached €7.89trn by the end of the second quarter (Q2) 2011. This growth, which will support the savings and retirement of a large portion of the European population, means asset managers have an enormous responsibility to their end clients. By Ann Doherty and Brian Coughlin, JP Morgan Worldwide Securities Services (WSS).

It is inevitable that asset managers want to retain their investment gains by reducing uncertainty and risk from their activities as much as possible and increase straight through processing (STP) and transparency, particularly in today’s volatile environment. One way to achieve that is to use a custodian that can provide all of these benefits through a streamlined product offering to help reduce both costs and risks while keeping up with the ever-

changing regulatory environment.



The objectives of asset managers present their own challenges, particularly with a regulatory reform agenda framed by G20 commitments, which culminated in the Dodd Frank Wall Street Reform Act and the European Market Infrastructure Regulation (EMIR). Since 2008, regulation has been constantly evolving and expanding. In addition to those two regulations, investors also have to adjust to the second iteration of the Markets in Financial Instruments Directive (MiFID II), UCITs IV, AIFMD, FATCA, Basel III and Solvency II.

To understand and execute on what regulators expect from them, asset managers today look to their service provider for help with the provision of an industry-leading  global custody and securities services offering with innovative technology to meet their daily requirements; seamless execution to increase STP and reduce risk; thought leadership to help them understand how regulation and potential market events could affect them (as well as their end-clients) and provide appropriate and timely data analysis.

Inevitably, the most sophisticated asset managers want to work with a securities services provider that can provide global reach and which has sufficient resources of capital to invest in industry-leading systems and technology. That means all of their requirements are met in one place. Investors then benefit and can have confidence in the fact that whatever complexity is injected into the market, whether by unexpected market events or by regulators, their custodian will be able to manage it.

Next, asset managers want seamless execution to help them eliminate risk and costs. Recognising the important role that asset managers play in the savings and pensions industry, regulators are putting pressure on them to provide their end clients with transpar­ency and as little risk as possible.  To do that, fund managers must tighten up the chain in their post-trade activities. 

For their part, custodians have been moving into more consultative technology-driven services for years, which asset managers and other users of custodian and related securities services have greatly benefitted from. Increasingly, these users of securities services are looking to their providers to move even closer to their front office, even coming just after the trading and investment decision. 

In the past, using one firm’s investment bank to execute trades and using the same bank’s custodian arm might have raised concerns about whether this one-stop-shop provided the best execution and cost in the market. ­Regulations, particularly MiFID, have removed that uncertainty.

Finding a provider that can tick the first two boxes as well as provide the critical consultative thought leadership all asset managers look for to keep up with regulatory and market changes, isn’t easy. Asset managers look to their service providers to provide ­information about changes arising from the rapidly evolving regulatory environment, to ensure that new requirements are understood and ­prepared for. Large international firms that are present in multiple jurisdictions are best placed to have a view of regulatory changes and to adapt their services to new requirements on a global basis.

Lastly, asset managers also rely on service providers to help them provide up-to-date and transparent data ­analysis, which is a critical reporting requirement to regulators, governments, trustees and other stakeholders, and is part of their own internal risk reviews.

This means asset managers want detailed information about their ­transactions, securities held, and ­breakdown of the core characteristics of those assets. They also want this data delivered in a fast and efficient manner, which requires a strong STP framework. This presents a challenge and an opportunity for service providers as it is not an easy task pulling together different sets of data and presenting it in a format that asset managers can consume and customise.

To meet all of these requirements, a service provider has to continuously invest in technology, and have ­regu­latory experts who can quickly analyse new regulations and understand how they will fit and potentially impact existing regulations with which asset managers are already complying. This re­quires a delicate balance between investing in business enhancements and people, while maintaining required capital levels. Large global custodians with the capacity to invest in its technology and systems are more able to make these investments than smaller firms.  

Asset managers are looking to ­securities services providers to act more strategically then ever before. By using one bank for all activities following the investment decision, asset managers are recognising their ability to cut potentially weak links from their post-trade chain, and rationalise the number of providers they use. This coordinated servicing effort across a firm, usually a bank, enables the large and fully-integrated players to really understand an asset manager’s needs, requirements, product and geo­graphical expansion plans. This support across many distribution channels helps fund managers reduce cost,

outsource the risk by leveraging ­operational cap­abilities, risk management capabilities and therefore offers a much better and broader value proposition. Today, a service provider must have all the ­necessary tools in the tool box and be willing and able to use them.

Tweets by @DataLend

DataLend is a global securities finance market data provider covering 42,000+ unique securities globally with a total on-loan value of more than $1.8 trillion.

What do our tweets mean? See: http://bit.ly/18YlGjP

Related News

Related Articles

Related Blogs

Related Videos