The financial world is spending countless hours — and millions of dollars — hypothesizing how blockchain — the new distributed way of storing information — could eliminate huge operational costs. Banks, broker-dealers, exchanges, and securities depositories have started exploring its potential vast use with the help of technology providers. Blockchain could theoretically be applied to […]
Uncleared Swap Deals: Clarity Is Work in Progress
“It’s not that complicated.” Regulators might have thought that setting specific rules for margining uncleared swap transactions would make life easier for financial firms because they will won’t have to negotiate over how, or even whether to collateralize their deals. They couldn’t have been more wrong. So said panelists and attendees at the International Swaps […]
Outsourced Compliance Officers: Red Flag for SEC?
The decision of the US Securities and Exchange Commission to require fund managers to disclose on their Form ADV whether they have outsourced their chief compliance officer role is starting to cause some angst. Asset managers wonder if they will be targeted for additional scrutiny, only because they delegated their regulatory compliance work to an external provider. […]
Artificial Intelligence: The Next Frontier in AML Compliance
Concerned about potential regulatory fines and skyrocketing costs, the world’s largest banks are turning to artificial intelligence to improve their compliance with know-your-customer and anti-money laundering regulations. “The value proposition for AI solutions is highest for large banks with significant volumes, complexity, multiple lines of business and geographical reach as these banks are affected most […]
Fund Managers Outsource More Mid-Office Ops
Gone are the days when the middle office is maligned as being strictly a cost-center dragging down investment performance. Today more fund managers are concluding that more effective management of their middle office can not only reduce operating expenses, but also give them a competitive edge with investors and keep regulators at bay. Fund management […]
Blockchain for US Settlement: Three, Two, One, Takeoff? (Update)
(Editor’s Note: On Sept 14 itBit announced that its flagship Bankchain and other post-trade projects would be run out of a new firm Paxos with the same management. The former itBit, would be a division of Paxos, and continue to operate its crypto-currency trading platform). If US blockchain afficionados have their way, the technology […]
Reporting Securities Finance Deals: More is Less?
Say what, say who, say when? That’s the reaction of fund managers, custodians and market infrastructures to the European Securities and Market Authority’s request for feedback on a new regulation requiring reporting information on securities finance transactions to trade repositories. Market players complain that ESMA’s technical specifications for complying with the Securities Finance Transaction Regulation […]
Fund Managers to SEC: Change DTCC, ICE Swaps Rules
Fund managers are asking the Securities and Exchange Commission to force Depository Trust & Clearing Corp. and ICE to adapt their rulebooks to match their limited reporting responsibilities for security-based swap transactions. The Asset Management Group (AMG) and Investment Company Institute (ICI) say that the DTCC’s Trade Repository and the ICE Trade Vault have overstepped the […]
FATCA, GATCA Tax Patience of Relationship Managers
Relationship managers on the front-lines of interacting with investors or customers say that complying with the Foreign Account Tax Compliance Act (FATCA) and its global version Common Reporting Standards (CRS) is giving them plenty of angst. The requirement to identify the investor or customer for tax purposes may conflict with the equally important need to […]
New TBA Margin Rules: Fund Managers, Brokers Retrench
Asset managers and broker-dealers will have to revamp some of their relationship terms, as well as those with the underlying investors, to meet the pending margin requirements for to-be-announced (TBA) transactions and other forward-settling fixed-income transactions. Panelists and attendees at a recent afternoon conference held by the Securities Industry and Financial Market Association about the Financial Industry […]