News 100924: Nasdaq, Quote, LSE CCP, Swift....and failure on the Bridge

Well, 9,000 runners and 1 person to beat…oops.

Evidence of the course run illustrated.

Evidence of my loss here:

http://www.marathon-photos.com/scripts/event.py?event=Sports/2010/Blackmores%20Sydney%20Running%20Festival&new_search=1&match=37358

Congratulations Daniel.

The Nasdaq initiative (price-size) is just further evidence of the various ways to slice the pie as execution has been utterly commoditised.

(So too will clearing eventually).

The costs of compliance and who wears the bill still have a long way to run in OTC clearing.

I do like transparency and ‘if you can’t measure it…’ but all this does add to costs (or at the very least strips costs out so they are apparent).

CCPs are NOT the cure for everything.

…and this is where I am a little surprised with the LSE view of CCP. It reads as “build it and they will come” to me.

I’m not so sure.

Set aside the economy of scale issues, vertical integration, enterprise vale etc…

Why would you want to build a new CCP?

European clearing fees are now at excellent levels.

Does the LSE, with the increased costs of fragmentation, really feel it is going to deliver cheaper clearing fees?

The banks already have a stake in LCH.CN…do they want more capital invested in more CCPs…to compete with their existing investment?

I’d certainly be tempted to look at the UK settlement model (where Euroclear still charge ‘clearing fees’).

My feeling is European equity clearing is approaching the point where it has been commoditised…pretty much as execution has.

There are still plenty of other dimensions to the exchange revenue model that are maybe not as capital, labour and regulatory intensive.

…now if this LSE CCP is for OTC business that has been mandated to be cleared…that could be a value proposition when offset against ‘on exchange’ flows.

If that was the case, it wouldn’t be appropriate for LSE to sit on the board of LCH.CN where the one product LCH.CN is enjoying strong revenue growth in…(but, hey, Xavier already resigned so that’s lucky).

Swift reduces fees by 20%!?...does that mean Sibos is drawing near?

Have a great w/end all (kids commence 2 weeks school holidays here),

S

http://clearingandsettlement.blogspot.com/

PLATFORMS

Nasdaq OMX to launch size priority venue
Global exchange group Nasdaq OMX is launching a new price-size priority equity trading platform in the US designed to encourage more trading in larger size.
http://www.thetradenews.com/trading-venues/mtfs-ecns/5074

Quote MTF

In a bid to attract flow to its platform, Quote MTF is putting a cap on commission fees at €14,000 until 2012 for all investors that sign up before 1 January 2011. The cap is intended to allow trading members to offer a low, fixed all-in price for their clients while gaining the benefits once the cap is reached.

The MTF is also offering a percentage of its total equity to passive liquidity providers. Bower says that the MTF is in discussions with a number of large investment banks that are interested in providing liquidity. Offering incentives through an equity stake rather than rebates will, he says, help to maintain the quality of liquidity on the Quote MTF order book

its execution pricing model of 0.14 basis points for aggressive trading and free passive trading

http://thetradenews.com/node/5072

QUOTE MTF OFFERS TO GIVE AWAY EQUITY TO ATTRACT BUSINESS

Hungary-based Quote MTF is offering to give away up to 40% of its shareholding to trading firms as it bids to secure participation in a fiercely competitive, consolidating market.

More on this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=21815

BURSA MALAYSIA DERIVATIVES PRODUCTS MIGRATE TO CME GLOBEX

http://www.finextra.com/news/announcement.aspx?pressreleaseid=35665

Tokyo Stock Exchange Selects NYSE Technologies To Build Futures Platform
Based on the successful Tdex+ platform already trading options on the TSE since October 2009, this futures ...

Tdex+ based futures system utilizing its LIFFE CONNECT platform with several customized features.

http://wallstreetandtech.com/exchanges/showArticle.jhtml?articleID=227500120&cid=nl_wallstreettech_daily

INTERACTIVE DATA NAMES ALEX GOOR CIO

http://www.finextra.com/news/announcement.aspx?pressreleaseid=35660

BRICKLES EXITS FOR GOOD AS PLUS TAKES AXE TO STAFF NUMBERS AND TECH Plus Markets has narrowed its first half losses as a new management team embarks on an aggressive cost cutting programme that has seen headcount and technology expenditure slashed and the departure of vice chairman Simon Brickles.

Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=21801

CBOE Stock Exchange Attracts Retail and Algo Order Flows with New Rebate Program
CBSX experiences 900 percent growth in volume with inverted "maker-taker" pricing program ...

http://advancedtrading.com/exchanges/showArticle.jhtml;jsessionid=TYWCE0SFIWHDFQE1GHRSKHWATMY32JVN?articleID=227500378&_requestid=30131

After a slow start, Japanese proprietary trading systems are seeing an uptick in turnover despite the overall decline in market volumes, says Takayuki Saito, the new head of electronic trading, Japan at Morgan Stanley MUFG Securities.

http://www.thetradenews.com/asset-classes/equities/5103

CLEARING

European Commission plans to migrate OTC derivatives to clearing via central counterparties will make the market more secure, but could hike trading costs for buy-side firms.

http://thetradenews.com/asset-classes/derivatives/5093

SCI report on CDS Clearing.

http://www.structuredcreditinvestor.com/story.asp?article=Clearing%20consensus&PubID=250&ISS=22352&SID=26047&SM=&SearchStr=&Category=Clearing&categories=77|Clearing&p_num=1

LSE in talks over London clearing house
By Jeremy Grant
FT.com / Companies / Financial Services
The London Stock Exchange is in talks with a group of Wall Street and European banks about jointly building and funding a clearing house in London, people familiar with the matter said.

http://www.ft.com/cms/s/0/56f78ffa-c26f-11df-956e-00144feab49a.html

EC Publishes Proposals on Derivatives, Market Infrastructures

The European Commission published a proposal for the regulation of over-the-counter (OTC) derivatives and market infrastructures that introduces a reporting obligation for OTC derivatives, a clearing obligation for eligible OTC derivatives, measures to reduce counterparty credit risk and operational risk for bilaterally cleared OTC derivatives, common rules for central counterparties (CCPs) and for trade repositories, and rules on the establishment of interoperability between CCPs. The commission notes the proposal is consistent with the recently adopted U.S. legislation.

The proposal introduces the following measures: requires the use of CCP clearing for OTC derivatives that meet predefined eligibility criteria; sets specific targets for legal and process standardization and bilateral clearing of OTC derivatives transactions; requires market participants to report all the necessary information on their OTC derivatives portfolios to a trade repository or, if that would not be possible, directly to regulators; and requires the publication of aggregate position information. The European Securities and Markets Authority (ESMA) will also be responsible for the surveillance of trade repositories and for granting or withdrawing their registration. The proposed regulations are scheduled to take effect starting at the end of 2012.

http://ec.europa.eu/internal_market/financial-markets/docs/derivatives/20100915_proposal_en.pdf

http://ec.europa.eu/internal_market/financial-markets/docs/derivatives/20100915_impact_assessment_en.pdf

Nasdaq OMX, GFI to Clear Power Contracts in U.S.

Nasdaq OMX Group and GFI Group Inc. plan to clear trades in power and natural gas on EnergyMatch, GFI’s electronic platform for trading in commodities. The clearing service will be Nasdaq OMX Commodities Clearing Company.

http://www.securitiestechnologymonitor.com/news/nasdaq-gfi-power-clearing-26114-1.html?ET=securitiesindustry:e2111:171544a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=SIN_DailyClose__092110

SWIFT To Reduce Message Prices By An Average 20 Percent - Customers Will Save EUR 70 Million In 2011 - Largest Price Decrease Since 1995
Press Release
SWIFT, the provider of global financial messaging services, announced yesterday that it is reducing the price of messages on its core FIN service by an average of 20 percent. This will represent an estimated saving of EUR 70 million for SWIFT customers in 2011. The new pricing plan takes effect on 1 January 2011.
http://jlne.ws/cxgbC5

21/09/2010 11:54:00

SWIFT LINKS SECURITIES MATCHING SYSTEM TO MULTIPLE CCPS

Financial messaging outfit Swift is set to link its securities matching system to a range of central clearing counterparties, including EuroCCP, Six x-clear and LCH.Clearnet, enabling brokers to direct their matched off-exchange trades to a variety of providers.

More on this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=21811

Singapore Exchange – First In Asia To Clear OTC Traded Financial Derivatives

Starting with the clearing of Interest Rate Swaps (IRS) denominated in Singapore and US Dollar, the new service is scheduled to be operational by October 2010, subject to regulatory approval.

To date, ten banks have initiated membership processes. They are Barclays Bank PLC, Citibank N.A., Credit Suisse AG, DBS Bank Limited, Deutsche Bank AG, The Hongkong and Shanghai Banking Corporation Limited, Oversea-Chinese Banking Corporation Limited, The Royal Bank of Scotland plc, Standard Chartered Bank and United Overseas Bank Limited.

http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=92903

EMCF Clearing Fund contributions.

http://www.emcf.com/upload/uploads/Regulation%20Clearing%20Fund%20101001.pdf

*** increase as of 1^st Oct.

POLICY

EU Council Publishes Texts on ESMA, EBA and ESRB

The EU Council published the latest regulatory proposals for the following: the European Parliament and the Council establishing a European Securities and Markets Authority (ESMA); the proposal for a regulation of the European Parliament and the Council establishing a European Banking Authority (EBA); and the proposal for a Council Regulation entrusting the European Central Bank (ECB) with specific tasks concerning the functioning of the European Systemic Risk (ESRB).

ESMA text

EBA text

ESRB text

CFTC's Gensler offers insight into swaps oversight
Gary Gensler, chairman of the Commodity Futures Trading Commission, outlined a plan for implementing measures in the Dodd-Frank act. Gensler estimated how many companies might be affected by changes to the massive swaps market and said the CFTC is working to define "swap dealer, "major swap participant" and other terms. "Initial estimates are that there could be in excess of 200 entities that will seek to register as swap dealers," Gensler said. Read Gensler's full remarks. The Wall Street Journal (9/17)

Real-Time Swaps Reporting May Start in Sept '11-CFTC

The head of the U.S. futures regulator said Tuesday that mandatory real-time reporting of swaps trades, a key measure to promote market transparency, could begin as early as September 2011.

http://advancedtrading.com/regulations/showArticle.jhtml;jsessionid=GI3UJCWW24RQZQE1GHRSKHWATMY32JVN?articleID=227500322&_requestid=261509

CFTC plans to consider and vote on rules for derivatives
Gary Gensler, chairman of the Commodity Futures Trading Commission, said regulators are poised to vote Oct. 1 on rules for clearing of derivatives. Gensler said the rules include governance procedures at exchanges, swap-trading platforms and clearinghouses. The CFTC also will consider rules for clearing venues that are deemed systemically important. The Wall Street Journal (9/22)

PARTICIPANTS

Deutsche Bank's plans for Basel III add pressures to competitors
Deutsche Bank announced a €9.8 billion cash call on the same day that Basel III capital rules were unveiled, piling pressures on its rivals. Deutsche Bank vowed to meet the rules five years before it is required to do so, making it more difficult for other banks facing capital concerns to bide their time. "Reaching Basel targets before the official schedule will, I think, become a point of excellence ... There will be some pressure on other banks that are not able to meet this sort of target," said Konrad Becker, an analyst at Merck Finck. Bank Systems & Technology (16 Sep.)

Deutsche Bank fixes subscription price for new shares at EUR 33.00 per share

http://www.db.com/ir/en/content/capital_increase_2010.htm

Singapore, 15 September 2010 – Deutsche Bank today announced that it is the first institution to implement Third Party Clearing services for a client on the Singapore Exchange (“SGX”). The client, Cantor Fitzgerald (Singapore) Capital Markets Limited (“Cantor Fitzgerald”), is a leading global financial services firm serving the institutional equity and fixed income markets. Cantor Fitzgerald has appointed Deutsche Bank to provide Third Party Clearing services for its clearing and settlement activities.

BANK OF AMERICA MERRILL LYNCH TO FORM DERIVATIVES CLEARING UNIT

http://www.finextra.com/news/announcement.aspx?pressreleaseid=35747

Don't be afraid your life will end; be afraid that it will never begin."

--Grace Hansen,
American dance director

The shortest way to do many things is to do only one thing at once.

- Samuel Smiles

An Austrian zookeeper enlisted the help of unwitting rhinos by growing cannabis in their enclosure. The scheme worked for years until a stool pigeon betrayed him.

http://www.spiegel.de/international/zeitgeist/0,1518,718603,00.html#ref=nlint

Price of Stolen Credit Card Data Has Dropped to $1.50

http://www.banktech.com/blog/archives/2010/09/price_of_stolen.html?cid=nl_bnk_daily

Scott Riley

Business Development

8th Floor | 50 Bridge Street | Sydney | Australia | 2000

((Off)+61 (0)2 8916 9634 È(Mob): +61 (0)418 117 627

* scott.riley@au.abnamroclearing.com

AMCF News: LSE outage, NASDAQ, US policy, S&P, cheques, Wedding Cake Island

LSE results and outage take the headlines. I see no shame in asking to make markets better. Allowing the free flow of liquidity is exactly what nature intended. Using the auction process to dupe smart order routing into locking liquidity might work once, but the cats is now out of the bag. Technology will adapt.

http://www.chi-x.com/chi-x-press-releases/chi-x-europe-lse-outage-final.pdf

Nasdaq developments in OTC clearing and looks like EACH is growing beyond its initial name. More ACH.
Some laughable US policy being espoused.
And S&P…can you really take them seriously?

Farewell the cheque…but then again.

Working With Idiots Can Kill You!
http://bigmacky.wordpress.com/2007/08/29/working-with-idiots-can-kill-you/
*** an excellent article on TCA. Must say, “Global Cooling Is An Ecological Disaster —On Pluto!” is also of concern.

Another great swim this w/end. The wedding Cake Island swim. Out from Coogee beach and around the island.
“The bottom around Wedding Cake is littered with rounded boulders on the inside, and with forests of weed and rock shelfs on the ocean side. There's a lot of sea life down there”
More here.
http://www.oceanswims.com/nsw90/coogee09.html

Results already in at:
http://www.oceanswims.com/results90/coogeeres092.html
A time of 45:15 or 69/147 in age and 393/851 in the mens.

You can see the island here:
http://maps.google.com.au/maps?f=d&source=s_d&saddr=coogee+surf+life+saving+club&daddr=-33.927605,151.261353&geocode=FUJg-v0d9QIECSG01VQJHmHacA%3B&hl=en&mra=dme&mrcr=0&mrsp=1&sz=16&dirflg=w&sll=-33.923848,151.260259&sspn=0.012464,0.01457&ie=UTF8&t=h&z=16

Dawny results in:
http://www.oceanswims.com/results90/dawnyres09long.html
No. 139 a solid boofheads 44mins.

And as for those Wallabies. May the best team win. I’ll not be upset if Wales win, but I’ll support the Wallabies so there is someone to ridicule in the pubs!

Now…cricket..there’s a game.

Great w/end all,

S
http://clearingandsettlement.blogspot.com/

If a cluttered desk is the sign of a cluttered mind, what is the significance of a clean desk?"
--Dr. Laurence J. Peter, Canadian educator


Platforms

Chi-X Europe Said Likely to Name Alasdair Haynes as New CEOBy Nandini SukumarNov. 23 (Bloomberg) -- Alasdair Haynes may be named chief executive officer of Chi-X Europe Ltd., the region's biggest alternative trading system, according to three people familiar with the situation. http://www.bloomberg.com/apps/news?pid=20601102&sid=atLtwQaDZxjQ

FT TRADING ROOM: Interview Transcript – Mark Howarth and Hirander MisraBy Jeremy Grant11/23/09Transcript of interview with Mark Howarth, interim chief executive of Chi-X Europe, and Hirander Misra, chief operating officer, with Jeremy Grant, Editor, FT Trading Room.FT: I think a lot of people would be surprised to know that you almost have 25 per cent of the FTSE 100, two and a half years after launch. Put that together with the share that you have on continental Europe and you are, give or take, fourth largest trading platform in Europe. Is that where you expected to be?....

Majority of Europe's dark-equities market shifts to MTFsIn the month through Thursday, Chi-X Europe, BATS Europe and Turquoise dealt with a combined 54% of trades in Europe's market of dark equities. The multilateral trading facilities started operating dark pools in May. Liquidnet Europe, Nyfix Euro Millennium and ITG Posit controlled 98% of the market then. Since then, the three established dark pools have seen their market share dwindle to 39%, according to Thomson Reuters. The Wall Street Journal/Financial News (22 Nov.)

London Stock Exchange says profits plungeLONDON (AFP) The London Stock Exchange announced on Wednesday that six-month net profits nosedived by almost 40 percent, as a result of depressed markets and increasing competition.http://news.yahoo.com/s/afp/20091125/bs_afp/britainmarketsstockscompanyearningslse_20091125094526

26/11/2009 12:27:00
GREMLINS STRIKE AGAIN AT LSE AS SHARE PRICE PLUMMETS OVER DUBAI FEARS
The London Stock Exchange is once again grappling with technical problems on a day when its shares have taken a hammering on fears that Borse Dubai may be forced to dump its 20% stake in the UK market.
More on this story: http://www.finextra.com/news/fullstory.aspx?newsitemid=20798
*** Xavier Rolet, CEO of the London Stock Exchange, said: "We regret the inconvenience that today's disruption to trading has caused for our clients. Having resolved the immediate issue, we are working hard to ensure this doesn't happen again ahead of switching to MillenniumIT's trading platform next year."



NASDAQ OMX Baltic Creates A Single Marketplace - A New Trading Venue For Shares Listed On Three Existing ExchangesNASDAQ OMX Baltic, part of the NASDAQ OMX Group, Inc. (NASDAQ:NDAQ), today announced its intention to create a new single marketplace to trade shares listed on the regulated markets NASDAQ OMX Tallinn, NASDAQ OMX Riga and NASDAQ OMX Vilnius. The Euro will be the trading and settlement currency for the marketplace scheduled to launch in the first half of 2010, subject to member readiness and necessary approval from local authorities. http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=86836NASDAQ OMX Acquires Shares In Baltic Exchanges - Move To Improve Ability To Develop More Liquid Baltic Capital MarketsNASDAQ OMX Nordic, part of The NASDAQ OMX Group, Inc. (NASDAQ:NDAQ), has agreed with Swedbank and SEB to acquire their minority stakes in the NASDAQ OMX Tallinn exchange. At the same time, other local minority shareholders have also sold their stakes in NASDAQ OMX Tallinn to NASDAQ OMX, bringing NASDAQ OMX's ownership in NASDAQ OMX Tallinn to 93 percent. In connection with this deal, SEB has also sold its 1.2 percent stake in NASDAQ OMX Vilnius to NASDAQ OMX. NASDAQ OMX's goal is to reach 100 percent ownership in all NASDAQ OMX's Baltic entities in the near future. Terms of the transaction were not disclosed. http://www.exchange-handbook.co.uk/index.cfm?section=news&action=detail&id=86838


Treasury battle: ELX takes on NYSE CHRISTINE BIRKNERTwo rival exchanges in the Treasury futures space could be set for a battle on the regulation front. On Oct. 13, NYSE Euronext and the Depository Trust & Clearing Corporation (DTCC) finalized their formal agreement to create a joint venture, New York Portfolio Clearing (NYPC), to clear interest rate products traded on NYSE Liffe U.S. NYPC would margin cash and derivatives markets in a single pot, rather than through existing cross-margining agreements. ELX, which launched trading of U.S. Treasury futures in July, sent a letter to the SEC on Oct. 28 objecting to NYSE's filing of draft amendments to approve the venture. ELX says that filing the venture in a draft manner was an attempt to keep ELX or other exchanges from having a public opportunity to submit any objections to the SEC. ELX's main objection is that the venture is anti-competitive.http://www.futuresmag.com/Issues/2009/December-2009/Pages/ELX-takes-on-NYSE.aspx

innerExchange releases inExFlexinnerExchange has announced the release of inExFlex, version 3.0 of its exchange platform solution, a FIX native trading infrastructure for the OTC markets The company states that the technology move from the traditional exchange model to new business agile exchanges and marketplaces is underway, and innerExchange will support the move. New electronic exchanges and internet driven marketplaces can bring huge advantages for distribution, flexibility and lower cost. inExFlex, operates a trading p..http://www.automatedtrader.net/news/exchange-news/24596/innerexchange-releases-inexflex

ASX futures fail to trade Australian securities exchange operator ASX's plans to take a lead in the renewable energy market stalled yesterday when a new futures contract failed to trade after listing for the first time.http://www.stuff.co.nz/business/market-data/3094970/ASX-futures-fail-to-trade

Turkish bourse to use Aleri for trading surveillance




Clearing


Burgundy appoints second CCP
Thu, 2009-11-19 16:58
Burgundy, a multilateral trading facility specialising in Nordic stocks, has chosen Swiss clearing house SIX x-clear as its second provider of central counterparty (CCP) clearing.
SIX x-clear will join pan-European clearing house European Multilateral Clearing Facility (EMCF), which has cleared trades on Burgundy since the platform launched its CCP service on 9 October. Burgundy expects to add SIX x-clear to the service in the second quarter of 2010, pending final agreement between the relevant parties and approval of interoperability agreements by the relevant European regulators.
http://www.thetradenews.com/asset-classes/equities/3907

Nasdaq OMX (Clearing)
OTC Derivatives System Debuts with Razor Edge on Competition
http://www.windowsfs.com/capital-markets/otc-derivatives-system-debuts-with-razor-edge-on-competition

also:
http://www.idcg.com/idcg/press.html
http://www.idcg.com/pdfs/idcg/IDCG%20Educational%20Brochure.pdf
http://www.efinancialnews.com/homepage/content/1055665918/


NATIONAL CLEARING CENTRE JOINS EACH
http://www.finextra.com/news/announcement.aspx?pressreleaseid=31215




Policy

Market participants are fiercely divided on whether the US Securities and Exchange Commission should follow through on its proposal to ban 'flash' orders in the US equities and options markets, according to responses submitted during the comment period, which closed on Monday.
Read story
http://www.thetradenews.com/regions/americas/3930

Dark Pools Seek Limited TransparencyDark pools provide institutional investors with a valuable venue for trading large blocks of securities. ...
http://wallstreetandtech.com/trading-technology/showArticle.jhtml?articleID=221600329&cid=nl_wallstreettech_daily



Senator Kaufman Calls for End to Sponsored AccessSenator Ted Kaufman (D-DE) has delivered a letter to SEC Chairman Mary Schapiro and four commissioners urging them to end sponsored access and "combat manipulative high frequency trading algorithms.”
*** hopeless.

Democrats push $150B stock tax on Wall StreetBy Silla BrushA House bill still being drafted aims to raise $150 billion each year to pay for new jobs. Under a bill being drafted by Democratic Reps. Peter DeFazio (Ore.) and Ed Perlmutter (Colo.), the sale and purchase of financial instruments such as stocks, options, derivatives and futures would face a 0.25 percent tax.http://thehill.com/homenews/house/69295-dems-push-wall-street-150b-stock-tax
**** Ummm, even more hopeless.


PAYPAL FOUND IN BREACH OF AUSTRALIAN ANTI-MONEY LAUNDERING RULES Australian financial crime regulator Austrac has given PayPal a one-year deadline to tighten up its procedures for managing money laundering and terrorism financing risks, after finding the firm in breach of the country's AML laws.
Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=20781
*** Not only does Austrac exist, it bites!

Many banks are still unsafeStandard & Poor's gives warning that nearly all of the world's big banks lack sufficient capital.http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6638922/Most-global-banks-are-still-unsafe-warns-SandP.html
*** Amazing, one GFC and all of a sudden S&P comes out with a revelation.
[in 2008 the rating agencies had 20 organisations rated at AAA and…64,000, yep sixty four thousand structured products rated AAA.
http://clearingandsettlement.blogspot.com/2009/06/amcf-news-chi-x-jb3-elx-stakeholders-db.html]

****
Given the key role the ratings agencies played in creating the global financial crisis with their risk-modelling and rating of cancerous sub-prime mortgages that were sliced and diced into complex securitised bundles, of course, no one should take pronouncements on creditworthiness from these newly conservative agencies too seriously. http://www.businessspectator.com.au/bs.nsf/Article/SP-NAB-ANZ-Commonwealth-Bank-CBA-banks-capital-pd20091125-Y5A7Y?OpenDocument&src=kgb
*** hear, hear!



FSA raps Nomura for inadequate derivatives valuationhttp://www.thetradenews.com/asset-classes/derivatives/3925
*** I hate this “double dipping”. You self disclose (take a P/L hit) and then you get a rap on the knuckles too. Do the auditors get a fine too…or are they too hard to go after. My son lost his DS once. (nicked from the poolside on vacation – he was careless). I was upset, he was distraught. I made him save for a new one…but I didn’t lump him with a fine too.





UK BANKS SET TO VOTE ON ABOLITION OF CHEQUES The UK's major banks are set to vote next month on whether to stop clearing cheques as consumers increasingly turn to cards and electronic transfers.
Full story: http://www.finextra.com/news/fullstory.aspx?newsitemid=20780
*** not if, but when

$9 BILLION Check That Saved Morgan Stanley: Is It The Biggest Check Ever? (PHOTO)Ever wondered what a $9 billion check looks like? http://bit.ly/4UtrV1
*** but then again, cheques do come in handy in a tight spot.


Advertisement In A Long Island Shop: Guitar, for sale. Cheap. No strings attached.On a bulletin board: Success Is Relative. The more The Success, The more The Relatives.You Know Your kids Have Grown Up When: Your Daughter Begins To Put On Lipstick.. Or when your Son starts To wipe It Off.Sign In A Bar: ‘Those Of You Who Are Drinking To Forget, Please do Pay In Advance.’Sign In Driving School: If Your Wife Wants To Learn To Drive, Don’t Stand In Her Way.Behind Every Great Man, There Is A Surprised Woman.The Reason Men Lie Is Because Women Ask too Many Questions.Getting Caught Is The Mother Of Invention.Laugh And The World Laughs With You, Snore And You sleep Alone.The Surest Sign That Intelligent Life Exists Elsewhere In The UniverseIs The Fact That It Has Never Tried To Contact Us



Scott Riley
Business Development

[Please note my new email address: scott.riley@au.fortisclearing.com]

Fortis Global Clearing
8th Floor 50 Bridge Street Sydney Australia 2000
((Off)+61 (0)2 8916 9634 È(Mob): +61 (0)418 117 627
* scott.riley@au.fortisclearing.com

AMCF News: SEC widens the net, Nasdaq, I/op

G’day All,

SEC SETS SIGHTS ON SPONSORED ACCESS AND EXCHANGE CO-LOCATION…
“I liken it to giving your car keys to a friend who doesn't have a license and letting him drive unaccompanied," says SEC chairman Mary Schapiro

OK, lets run with this analogy. Sure, sometimes I throw the car keys to a mate that might be visiting. But I have different levels of mates. Some, I say bring the car back when it suits, and I turn my back and I don’t give it a 2nd thought (they’re equally aware of the risks as me). Others, I might say “Sure, I’ll hop in with you for the ride”. When people risk their assets (or balance sheet / capital) they know what they’re doing. They have protections and recourse in place. If they don’t, they won’t be an enduring part of the financial landscape. We take risks every day, and so we should. It’s just understanding the magnitude of those risks that differentiates the teenagers from the adults.

Or as another person said:
He who is not courageous enough to take risks will accomplish nothing in life."
--Muhammad Ali, American boxer and three-time world heavyweight champion

A lot about Nasdaq this week.
I’m surprised they “suspend” their US equities ambitions. I’m sure this is only the headline and the real reasons must run deep. I hope they keep this under review. Somewhere, I believe there is a niche for them to explore.
Right to exit the Securities white label servicing business, a much better fit for Waterhouse.
X-Stream gets placed in Dubai.

Chi-X takes 2nd spot in Europe’s “exchanges” (read trading venue) on Thursday.
(home page has updated, but worth a look)
www.chi-x.com

A shame about delays to access and interoperability.
I believe contagion and default fund contributions were always a meaningful issue.

http://www.eachorg.eu/each/
http://www.eachorg.eu/digitalAssets/49/49401_AccessInteroperabilityGuideline.pdf
84. Risk Management:
CCPs will recognise the specific status of each other as CCPs and not as risk-taking
intermediaries.
• The CCPs involved have to arrange an adequate collateralisation scheme to cover
the exposure of potential losses.
• No CCP is obliged to contribute to the other CCP’s participants’ default fund or
other post default backing schemes.
• A default of a Clearing Member at one CCP should not affect the other CCP unless
the first CCP itself is in default.

This weekend sees us celebrating Halloween…in fancy dress.
I’ll be going as Patrick Star(fish) – (for those not familiar with Patrick, just watch Spongebob square pants – Patrick makes a goldfish’s short term memory look impressive – my kids recommended Mr Crabs, tight and cranky, but I couldn’t source the claws).

…and for those doing the Noosa eyeline events this week-end best of luck,
….meanwhile I’ll be clearing up after our Halloween party.

Great w/end all,

S
http://clearingandsettlement.blogspot.com/



Platforms

Exchange group Nasdaq OMX is betting on its INET trading technology and its BX secondary equities trading platform to help it recover lost US equities market share, says Brian Hyndman, the group’s senior vice president of transaction services.
Read the interview
….an extract…
Last week the exchange announced it would revive the dormant equity licence from its 2007 acquisition of the Philadelphia Stock Exchange to create a third US equity platform. The new exchange will match orders according to price/size priority rather than the price/time systems used on the Nasdaq Stock Market and BX.
http://www.thetradenews.com/node/3765

Bats surges past Turquoise on UK fee cuts Bats Europe, the alternative trading system operated by US-based Bats Global Markets, has almost doubled its share of UK equity trades in just two months and has overtaken rival Turquoise for the first time, thanks to an aggressive price promotion that critics warned would have only a temporary impact on volumes.

CLS BANK TO ESTABLISH FX TRADE DATA REPOSITORY Foreign exchange settlement outfit CLS Bank is to establish a trade data repository for the global FX market, in a move designed to head off regulatory pressure for more transparency in the over-the-counter currency markets.
Full story: http://www.finextra.com/fullstory.asp?id=20671



Clearing

THE TRADE NEWS: Japan’s Alternative Platforms to Get CCP ClearingBy Staff10/26/09The Japan Securities Clearing Corporation (JSCC), the central counterparty for Japan’s stock exchanges, will be able to clear trades from the country’s alternative trading platforms, known as proprietary trading systems (PTSs), from July next year.
http://www.thetradenews.com/asset-classes/equities/3794

TRAYPORT AND PERCIVAL TEAM ON CLEARING AND SETTLEMENT
http://www.finextra.com/fullpr.asp?id=30508

Nasdaq ‘suspends’ plans to launch US equities clearing Nasdaq OMX has said it was "suspending" its plans to launch US equities clearing, with Bethany Sherman, a spokeswoman for the transatlantic exchange group, claiming the "threat of competition had forced the Depository Trust & Clearing Corporation, the market leader, to cut costs. (Financial Times)

TD WATERHOUSE COMPLETES ACQUISITION OF OMX SECURITIES
http://www.finextra.com/fullpr.asp?id=30608

DUBAI FINANCIAL MARKET LAUNCHES X-STREAM TRADING PLATFORM
http://www.finextra.com/fullpr.asp?id=30583





Policy



High- Frequency Trading: New Study Finds Divide on ImpactInstitutional investors are of mixed mind about whether the activities of high-frequency trading firms help or hurt their own trading operations, according to research conducted by Greenwich Associates.
http://www.securitiesindustry.com/news/-24116-1.html?ET=securitiesindustry:e1729:171544a:&st=email

27/10/2009 15:52:00
SEC SETS SIGHTS ON SPONSORED ACCESS AND EXCHANGE CO-LOCATION
After taking on dark pools and flash orders, the Securities and Exchange Commission has now turned its attention to high frequency trading and the practice of sponsored access to exchanges.
More on this story: http://www.finextra.com/fullstory.asp?id=20660
*** lets run with the car analogy

SEC looks into effects of high-frequency tradingThe Securities and Exchange Commission is looking into how high-frequency trading, which some estimate accounts for 50% or more of all equity trading in the U.S., affects markets, sources said. As lawmakers are scrutinizing the trading practice and other market developments, the SEC is not expected to publish a discussion paper on the strategies until December at the earliest. A congressional committee will discuss high-frequency trading, dark pools and other developments on Wednesday. Reuters (10/26)



Congress, White House will address "too big to fail"Legislation likely will be introduced in Congress this week that would make it easier for large financial institutions to be taken over by the government and wound down in an orderly fashion during a crisis. The bill, to be introduced by Rep. Barney Frank, D-Mass., after consultation with the Treasury Department, would likely make it more costly to be a large financial company whose failure would threaten the entire system. SIMFA President and CEO Timothy Ryan supports the effort, but warns that legislation could remove key provisions of the Bankruptcy Code given financial institutions. The New York Times (free registration) (10/25)


Chicago mayor, CME heads discuss future of futures industryThe Obama administration's plan to increase oversight of the derivatives markets is expected to have a substantial effect on Chicago's futures industry. CME Group Chairman Terry Duffy, Vice Chairman Charlie Carey and Chicago Mayor Richard M. Daley met recently to discuss how the changes would affect the futures industry. Daley's concerns center on how the changes would affect employment, while the CME leaders are urging Congress to quickly pass legislation that would require more over-the-counter derivatives to be traded on exchanges. Financial Times (tiered subscription model) (10/26)
*** CME leaders are urging Congress to quickly pass legislation that would require more over-the-counter derivatives to be traded on exchanges. – this just exposes their entire desire as self serving. Some of their arguments have merit, if only they were unbiased.


Regional

THE TRADE NEWS: Buy- and Sell-Side Welcome ASEAN Link, According to TABBBy Staff10/26/09Buy- and sell-side firms agree that efforts to harmonise equity trading in the Association of South East Asian Nations (ASEAN) will encourage more investment and faster technological evolution in the region, according to the latest study from research firm TABB Group.Five ASEAN countries – Indonesia, Malaysia, Philippines, Thailand and Singapore – agreed to create an electronic linkage between their exchanges in February 2009 for the trading of equities. A sixth nation, Vietnam, joined the initiative in September.

European success spurs Nomura's Asian ambition Nomura is launching a Japanese dark pool to compete for a larger share of the increasingly important Asian market, having already established itself as one of the top trading firms in Europe since acquiring parts of Lehman Brothers’ business a year ago.

*** A report from research house Tabb Group last month estimated the market share of Japanese alternative trading systems at 1.6% but predicted this number will increase to 3.5% by the end of 2011.

The Treasury provides advice on policies that promote competitive, efficient markets that work to enhance consumer wellbeing, a secure financial system and sound corporate practices, and foreign investment consistent with Australia’s national interest.
http://www.treasury.gov.au/contentitem.asp?NavId=036&ContentID=1649




SMARTS GROUP LAUNCHES MARKET SURVEILLANCE PLATFORM IN US
http://www.finextra.com/fullpr.asp?id=30575




Scott Riley
Business Development

[Please note my new email address: scott.riley@au.fortisclearing.com]

Fortis Global Clearing
8th Floor 50 Bridge Street Sydney Australia 2000
((Off)+61 (0)2 8916 9634 È(Mob): +61 (0)418 117 627
* scott.riley@au.fortisclearing.com