Operations, technology, legal and network managers at custodian banks and broker-dealers are starting to feel penalized when it comes to all the data collection, reconciliation and numbers crunching work they must do to pass along to their clients the new fines for settlement fails required by Europe’s Central Securities Depository Regulation (CSDR). One of the […]
Europe’s CSDR: Custodians Face Reporting Headaches
The European Central Securities Depositories Regulation (CSDR) is quickly turning into a misnomer for the legislation. Operations and IT managers at custodian banks must quickly develop new data consolidation and message reformatting workflow and technology to deliver the right information on settled and unsettled trades to local regulators in July 2019. Given that the pan- […]
CUSIP ID Codes Enter World of Blockchain
Equities and bonds have identification numbers so why not tokenized asset offerings (TAOs). That’s the premise of a new agreement between blockchain startup Templum Markets and CUSIP Global Services (CGS) whose goal is to promote liquidity and post-trade operational efficiency for TAOs. North America’s national numbering agency will now issue CUSIPs or nine-digit alphanumeric codes […]
BofAML’s Fake Trade Reports: Governance Breakdown?
How could Bank of America Merrill Lynch get away with giving institutional customers phony trade execution, transaction cost analysis and expense reports for five years? Ten brokerage operations and IT managers contacted by FinOps Report can only speculate after reading the scant details in separate settlement reports issued by the Office of the Attorney General […]
FINRA New Ops Certification: Two Exams Better?
What is the difference between a stock, a bond, a derivative, an exchange-traded fund and other financial products? What are customer suitability rules, margin rules and custody rules? These might sound like simple questions, but for US brokerage operations managers who must abide by changes in test formats imposed by the US Financial Industry Regulatory Authority […]
US T+1 Settlement: Not So Fast (Updated)
Update (May 13, 2018): Come late 2019, bank and broker-dealer members of the US Depository Trust & Clearing Corp. could look forward to reducing their settlement exposures by one day while retaining the current two-day settlement cycle. DTCC now says that US trades could be settled before the market opens on T+2 instead of the […]
SEC to Fund Admins: No Proof, No NAV
The US Securities and Exchange Commission has just warned fund administrators they can’t take the word of a fund manager when calculating the net asset value (NAV) of an investment fund. When explaining its recent US$561,000 fine against Gemini Fund Services, the US regulatory agency says that when assigning an NAV to a mutual fund, […]
New Year’s Message: Pay More for OTC ISINs?
Update 12/30/2017: This article has been updated to include more details about the DSB’s €8.8 million figure for overhead. Data, operations and vendor procurement managers whose buy- and sell-side firms need international securities identification codes (ISINs) for over-the-counter derivative contracts could end up with some bad news come January 15. Financial firms might discover they […]
Unique Product IDs: Can the OTC-ISIN Win the Job?
Can International Securities Identification Numbers (ISINs) become the foundation for unique product identifiers (UPIs)? The new Derivatives Service Bureau (DSB) which will allocate ISINs for over-the-counter derivatives, appears to think so. It also thinks that it might be the organization issuing the UPIs, although it is willing to work with others. If such a scenario […]
Morgan Stanley Fine: Lessons in Fee Recon Failures
Futures commision merchants had better pay far closer attention to their middle office fee reconciliation process, caution operations experts. Morgan Stanley’s recent US$500,000 fine from the Commodity Futures Trading Commission (CFTC) for overbilling clients trading fees isn’t a large fine considering the FCM’s size. What is alarming is that Morgan Stanley is the fourth FCM […]