With its new offering called Entity Exchange, Bloomberg is trying to take a bite out the market share — especially among hedge fund managers — of the existing utilities for automating know-your-customer requirements. Its strategy: give the buy side more control. Regulators require financial firms to know just who they are doing business with before they […]
New US AML Rules: Tough Enough to Catch the Bad Guys?
The US Treasury’s new rules on how financial firms must handle their responsibilities to know their customers and prevent money-laundering will be operationally challenging to follow, but perhaps not entirely effective in identifying the bad guys. The most controversial aspect of the new requirements — finding out the identities of the beneficial owners of the customers […]
Bloomberg Tries Hand at Legal Entity Identifiers (Updated)
(Editor’s Note: This article has been updated to reflect additional information received after its initial publication). Does the financial market really need another New York City-based organization issuing legal entity identifiers (LEIs)? How Bloomberg intends to compete with established providers like the Depository Trust & Clearing Corporation (DTCC), London Stock Exchange and Germany’s WMDatenservice is […]
Research Payments in Europe: Can CSAs Survive?
Asset managers of European funds may be breathing a sigh of relief thinking that European regulators will allow them to keep their commission sharing agreements (CSAs) to pay for research they use to make investment decisions for their clients. The reality is not so simple. As currently implemented, the CSAs may not comply with all […]
Panama Papers Fallout: Heavier KYC/AML Burden(Updated)
(Editor’s Note: After this article went to press, the US Treasury said it had adopted a rule requiring banks, broker-dealers, mutual funds, futures commission merchants and introducing brokers in commodities to collect and verify information on beneficial owners. The Treasury also sent to Congress legislation to approve requiring that companies formed in the US file […]
Transfer Agents, Brokers, DTC Debate SEC’s Proposed Rules
The Securities and Exchange Commission’s decision to overhaul the rules governing transfer agents has prompted a debate among shareholder recordkeepers on the one hand and broker-dealers and their allies on the other. It could easily take up to a year for any new requirements to take effect, However, transfer agents for equities and investment funds […]
Custodian Banks: New Landscape, New Strategies
A new research report authored by Morgan Stanley and consultancy Oliver Wyman has resurrected the debate over how some of the world’s largest custodian banks will need to rethink their time-honored strategy. Gathering more assets from more clients won’t be enough to sustain profitability. Earnings are under pressure from low interest rates and a historical […]
Securities Finance Data: Useful or Not for European Regulators?
In asking market players to shed more light on their securities finance transactions, European regulators have unintentionally opened an operational and legal can of worms. The newly passed European Securities Financing Transactions (SFT) legislation includes a requirement that managers of new European traditional and alternative investment funds disclose their policies involving securities finance transactions in […]
Squeezing Market Data Costs: Why, When, Where and How
Market data may be the life blood of financial firms, but it’s also a massive expense to them. Often quick to blame exchanges and market data vendors for overcharging them, financial firms eventually have to face the fact that the buck stops with them. If they want to reduce their data spend, they have to get their own […]
US Swing Pricing: Getting the Process Right
The US mutual fund managers may soon be following in the footsteps of their European peers in adopting swing pricing, but how ready are they to overcome the operational and compliance challenges? If the tone of discussions at a recent standing-room-only event hosted in New York City by the Association of the Luxembourg Fund Industry (ALFI) is any indication, the answer is […]