Saturday 7th March 2015
NEWS TICKER, FRIDAY, MARCH 6TH 2015: —BNY Mellon has been appointed by Accor, the hotel operator based in France, as depositary bank for its sponsored American depositary receipt (ADR) program. Accor previously traded in the US as an unsponsored DR. Each sponsored ADR represents one-fifth of an ordinary share and trades on the OTC Markets under the symbol ‘ACCYY.’ Accor’s ordinary shares trade on Euronext Paris under the code ‘AC’— The US Inland Revenue Service (IRS) says the FATCA IDES User Guide has been updated for March 2015 and includes user enhancements and additional instructions. Copies can be downloaded from the IRS websiteimage003.pngThe Federal Reserve Bank of New York has reported gross purchases from February 26th through March 4th of $4,737m worth of agency MBS transactionsimage003.png More than 100 members of European Parliament (MEPs) have signed an open letter to the European Union’s Telecoms Council, urging it to adopt a more relaxed stance towards roaming charges. The Council is looking to extend the “phasing out” of charges until mid-2018, more than two and a half years later than initially laid out in the Roaming III regulation established in 2012. Roaming III, one of Neelie Kroes’ flagship motions in the move towards a single digital market, had previously required the abolishment of all roaming fees by the end of this year. “The Council stance sets up a new pricing mechanism, which will make it much cheaper to use your mobile phone when travelling abroad in the EU,” it said. “Within certain limits to be determined, consumers could make and receive calls, send SMSs and use data services without paying anything extra on top of the domestic fee.” It also suggests limitations under which operators will be able to levy charges against roamers. “Without a strong Telecoms Single Market, the much needed Digital Single Market cannot flourish,” they said, in an open letter to the Council of the European Union. “The European Parliament urged an end to roaming charges by the end of this year (2015). We consider proposed delays by three years (2018), or a suggestion to allow for 5MB without charges per day, to lack ambition. Such outcomes will undoubtedly seriously disappoint citizens. The gap between ending roaming charges, and 5MB per day is immeasurably large.” The open letter to the Telecoms Council concluded with a plea to put an end to roaming charges and clearly define net neutrality, stressing its significance for the future of Europe’s digital economies—Danish dedicated wind company Vestas has placed a seven year €500m eurobond with an interest rate of 2.75%, which the firm says will broaden the firm’s funding structure. The bonds, which will be listed in Luxembourg, will be repaid on March 11th 2022. According to Vestas CFO Marika Fredriksson, this is the first time a "green bond" had been issued by a dedicated wind company—An Taoiseach, Enda Kenny TD; the Minister for Jobs, Enterprise and Innovation, and Clive Bellows, Country Head Ireland at Northern Trust say the bank will expand its operations in Limerick by creating up to 300 new jobs over the next three years. The expansion is supported by the Department of Jobs through IDA Ireland —Despite reduced market volatility in February, total traded volume on the Tradeweb European-listed ETF platform amounted to €7.7bn in the month. This was the platform’s third best performance since launch, only beaten by last October’s €7.9bn and January’s record-breaking €10.7bn volume. According to the firm, there was a clear buying trend across all asset classes on the platform, with “buys” outstripping “sells” by 26 percentage points as a proportion of the overall traded volume. “Buy” requests for equity-based ETFs climbed to 42%, while “sell” requests fell 8 percentage points to 31 per cent compared to the past 12 months. Three of February’s ten most heavily traded ETFs invest in fixed income, offering exposure to government debt and USD-denominated high yield bonds—Global business advisory firm FTI Consulting, Inc says Mark Hunt has joined as senior managing director in the firm’s Forensic & Litigation Consulting practice. Mark will be based in London. As a Senior Forensic Partner with over thirty years’ experience, Mark specialises in financial and regulatory investigations, audit and accounting negligence, expert determinations and accounting disputes. His work has included a number of complex international disputes for both claimants and defendants, as well as acting as an expert on issues relating to complex financial instruments. Mark joins FTI Consulting from BDO, where he led their Financial Services practice, which included conducting FCA/PRA Skilled Persons Reviews. Prior to joining BDO in 2007, Mark was a Partner at KPMG, and he is also a Fellow of the Institute of Chartered Accountants in England and Wales. In his new role, Mark will join the EMEA Financial Advisory Services leadership group, working with Jeannette Lichner, Stephen Kingsley, Andrew Durant and Nick Hourigan to continue building FTI Consulting’s practice— The Straits Times Index (STI) ended +22.24 points higher or +0.66% to 3417.51, taking the year-to-date performance to +1.56%. The FTSE ST Mid Cap Index gained +0.21% while the FTSE ST Small Cap Index declined -0.38%. The top active stocks were SingTel (+1.70%), DBS (+0.98%), Noble (+4.98%), Keppel Land (-0.22%) and Genting Singapore (-2.63). The outperforming sectors today were represented by the FTSE ST Telecommunications Index (+1.52%). The two biggest stocks of the FTSE ST Telecommunications Index are SingTel (+1.70%) and StarHub (unchanged). The underperforming sector was the FTSE ST Health Care Index, which declined -0.55% with Raffles Medical Group’s share price declining -0.51% and Biosensors International Group’s share price declining -0.77%. The three most active Exchange Traded Funds (ETFs) by value today were the STI ETF (+0.59%), iShares USD Asia HY Bond ETF (-0.85%), SPDR Gold Shares (-0.42%). The three most active Real Estate Investment Trusts (REITs) by value were CapitaMall Trust (-0.94%), Ascendas REIT (-0.40%), CapitaCom Trust (+0.28%). The most active index warrants by value today were HSI25000MBeCW150429 (-4.12%), HSI24200MBePW150429 (+0.60%), HSI24400MBeCW150429 (-2.99%). The most active stock warrants by value today were DBS MB eCW150420 (+8.65%), OCBC Bk MBeCW150803 (unchanged), UOB MB eCW150701 (+2.10%).

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.

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