The Daily Newsletter of Market Infrastructure









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Exchange Invest is a free daily email/web newsletter
about the core events pertaining to investment
in financial markets infrastructure such as:

  • exchanges
  • IT vendors
  • brokers
  • MTFs
  • clearing houses
  • etc.

MARCH 13 2017

Exchange Invest 951 means that next Monday looks a touch epic but meanwhile the Porsche design folks appended the 951 type to the lhd 944 Turbo as well as considering using it for the 964 turbo…

In Today’s Exchange Invest

Germany whines as Maggie Paganao looks wistfully towards NEX and thinks Xavier may yet pull an MTS rabbit out of his merger hat while elsewhere the Evening Standard has interviewed an energised Michael Spencer. Winklevoss Bitcoin ETF blocked by SEC while there is cooperation talk across the world all the way to Libreville.

And there’s more, happy scrolling, it’s another big Monday digest:

In BigWorld

Clearly as this newsletter is free and I am a petrolhead, I will indulge myself that today’s Bigworld news is the sad demise of John Surtees, a true polyglot of motorsport, the only man to win world championships on two wheels and four (he even won multiple Isle of Man TTs to demonstrate his sheer brilliance). He even built formula one cars during the 1970’s thus consolidating the early career of my hero, the brilliant Ulster road racer John Watson.

Don’t forget if you’re in the rest of the world, most of America is not where it was last week – at least in time zone terms – as they have sprung forward.

Public Markets

German Minister: LSE “Derailed” DB1 Deal, Blames London
City A.M.

PLY: Hesse Minister Schaefer offers a fabulous dose of hypocrisy in that obliviously unaware fashion common amongst the political classes: “The European Commission has not finally decided yet. My impression is, however, that with their veto on the sale of the business in Italy, those involved in London have not only sought and found a face-saving way out of the deal but they are also able to pass the buck to Brussels.

Behind all this, the remaining issue is that of the legal headquarters of the merged company and the apparent reluctance to set aside national considerations for the economic and legal benefits of the most reasonable option.”

So there you have it – when the HQ is in the provincial financial centre city of Frankfurt, it’s “the most reasonable option.” Whereas, when the HQ is in the world’s largest international financial centre it’s merely “national considerations.”

There are clearly Germans who have never managed to translate “My word is my bond” from either English or Latin.

Can The London Stock Exchange Boss Meet His Waterloo?
Reaction.life

PLY: I can’t help but feel this article is a tad, well Quixotic. Author Maggie Pagano concludes with a wistful turn towards Michael Spencer’s Nex in some ways but also raises thoughts XavRol might yet fold and sell MTS, clearly without her understanding the profundity of the repo end of the bond spectrum (but then again does any member of the scribbling classes?). Anyway, she always weaves the story together elegantly, no matter how some thoughts might strike parishioners as odd.

”Carcrash:” LSE Merger Should Go Ahead
Telegraph.co.uk

The head of Deutsche Boerse has declared that the proposed merger with the London Stock Exchange still makes sense, telling a German audience …

PLY: Note the phrase “telling a German audience.” This is of course the problem of the digital age – in the old days you could pop back to Frankfurt and say any old drivel and nobody noticed, at least until it was old news. Nowadays, the Interweb makes real time low latency Kardashians of us all, if we’re not careful….and of course the accused insider dealer Carcrash retains what might be regarded as a positively Wagnerian impulsive streak about his persona…

NB if you can’t recall “What’s Opera Doc” (or even the longer form versions of Wagner’s work), rarely does a Wagner magnum opus work out in the same happy way, as, say, an episode of “Friends.”

End Of Consultation On Proposed Amendments Of The Clearing Conditions Regarding The Default Fund
Eurex Clearing

PLY: Interesting reading. No seriously, it is interesting news on the CCP default front.

Lloyds, ICAP Europe & Tullett Prebon Dismissed From Yen Libor Litigation In The US
International Business Times UK

Singapore Shareholder Advocate Fine With Dual-Class Shares, Exchange Says Idea Under Review
CNBC

PLY: #Yeuk.

CBOE Stock : A Play On Technology
Barron’s

PLY: Long-term, it’s a sort of ultimate super-option on Dave Cumming’s IT prowess effectively, despite his not being within the management of CBOE at all… Steven Sears notes how data and analytics play an increasingly vital role in the pricing mix.

PSE To Acquire At Least 67% Of PDS By July
The Manila Times

PLY: Breath holding not recommended as the Philippine Stock Exchange (PSE) stubbornly pushes its odyssey to finalize deals to own at least a 67 percent stake in Philippine Dealing System Holdings Corp.

Brief- Warsaw Stock Exchange Unit Signs Loan Agreement For 60 Mln Zlotys
Reuters

The loan will be used to finance TGE’s payments to Tax Office for correction of value added tax (VAT) for the period from Dec. 2011 till Dec. 2016.

Private Markets

Message From The Chairman
Borsa İstanbul

SECP Asks New Board Of Stock Exchange To Frame Business Plan For Market Expansion
The News International

Pakistan Stock Exchange Presents Budget Proposals
DAWN.com

QSE, Nairobi Bourse MOU
Gulf Times

Rwanda Bourse Moves To Boost Trade Volumes, Infuse Liquidity
AllAfrica.com

Bermuda Stock Exchange Introduces Guide To Help Investors ‘Own Their Share Of Bermuda’
MondoVisione

Botswana SMEs Urged To List On Stock Exchange
Apanews

Tunis Stock Exchange Thinks Big
4-Traders

CSE Raps Sassy Offenders On Disclosure Requirements
The Sunday Times Sri Lanka

The Colombo Stock Exchange (CSE) is having little ‘chats’ with certain cheeky offenders who flout the rules.

Douala And Libreville Stock Markets Looking To Cooperate, To Boost Financial Market In Central Africa
Business in Cameroon

Special Section: FTI, NSEL, India at the Crossroads

Bombay HC Dismisses As Withdrawn NSEL Investors’ Plea For Disbursal Of Funds
Livemint

The Bombay high court on Friday dismissed as withdrawn a petition by investors who lost money in NSEL, meaning more facts are required before the proceedings can be revived.PLY: Nothing specific but note the MCX insider dealing story above which also involves FTIL the original backer of NSEL.

Technology

Nasdaq And CloudMargin Join Forces To Help Buy-Side Institutions Manage Cleared And Non-Cleared Derivatives Collateral
MondoVisione

MIAX Regulatory: Consolidated Audit Trail (“CAT”) Clock Synchronization Requirements
MondoVisione

Global Fintech Group For Standardisation Launched
FTSE Global Markets

PLY: Announcing The FinTech Technical Advisory Group (TAG)….not really sure what to make of this per se but least we have some faith in PJ DI Giammarino of JWG-IT fame.

Products

SEC Rejects Winklevoss Brothers Bitcoin ETF
Washington Post
SEC Statement
SEC

PLY: Bitcoin promptly fell sharply after the announcement (it bounced back over the weekend albeit on low volume). The refusal was driven by the SEC being unhappy about surveillance of the underlying given also that it takes place on unregulated Bitcoin exchanges. Frankly, it does not sound an unreasonable judgement but it has come as a shock to many in the Blockchain community who often have as tenuous an understanding of the regulatory world as, well, legal eagle Preet Bharara’s grasp of the general precepts of government agency employment.

Why The Bitcoin ETF Denial Is Actually A Good Thing
Seeking Alpha

More Bad News For The LBMA Silver Price Provides An Opportunity For Overhaul
Seeking Alpha

CME Group and Thomson Reuters have decided to step down from managing the LBMA Silver Price benchmark. This is strange…

PLY: Fascinating insights, a must read.

China Conducts Securitization Of PPP Projects
Xinhua

The country’s stock exchanges have reviewed applications from the first … to raise 700 million yuan, said the Shanghai Stock Exchange in a statement.

Tokyo Financial Exchange: Extension Of Discount Program In Three-month Euroyen Futures
MondoVisione

CFTC’s Division Of Market Oversight Issues Conditional Extension Of No-Action Relief Regarding Masking Of Certain Identifying Information Required To Be Reported
MondoVisione

Brief-China Still Preparing To Launch Oil Contract – Former Exchange Exec
Reuters

Deutsche Börse Launches Scale All Share Index
MondoVisione

PLY: Supports the new version of NeuerMarkt.

Azerbaijan Ready To Introduce National Stock Indices
Azerbaijan Business Center

Vugar Namazov, Acting Chairman of the Board of the Baku Stock Exchange, says that the methodology of calculation and introduction of stock indices is fully ready.
“In technical and organizational terms, the BSE has been prepared for the introduction of stock indices, but we are waiting for the moment when the market is ripe for this.”

PLY: Given their state of technical readiness perhaps Baku SE could help the LBMA out with silver while they wait to deliver domestic indices?

Career Paths

PLY: RIP Duff Scott, the Chairman of TSX from 1987 to 1989 whose Father had also served as Chairman of the Toronto Exchange.

Meanwhile the HKEx has some updated directors with the government’s reappointment of Anita Fung, Rafael Gil-Tienda and Margaret Leung while Stephen Yiu will succeed John Harrison who will retire from Board after the conclusion of the 2017 AGM.

Meanwhile, ESMA are seeking A Head Of The Markets Department And A Senior Risk Analysis Officer. The former position is open as Rodrigo Buenaventura has returned to Spain to become the Director General of the national regulator replacing Ángel Benito.

Michael Spencer: The City’s Top Tory On Why Theresa May Is Not Doing Enough To Defend Business
Evening Standard

PLY: A fascinating interview with the energised Michael Spencer about the NEX big thing…and indeed the latest broadly inept left wing government of Britain masquerading as free marketeers.

An Interview With Arthur Hayes And Ben Delo Of Bitcoin Exchange Bitmex
CryptoCoinsNews

I had the good fortune to meet Messrs Hayes and Delo at the Bitcoin Mercantile Exchange (BitMEX.com)’s Hong Kong office on February 21, 2017.

Crowdfunding

Need For SME Finance Sees Arrival Of Fintech Lenders
Moneyweb.co.za

Other Stories

Mixed Month For Listed Exchanges – FTSE Mondo Visione Exchanges Index Decreases By 0.8 Per Cent In February
MondoVisione

Disgruntled Sebi Writes A (Strongly Worded) Letter To The RBI
Bar & Bench

This has resulted in confusion over execution of trade by some FPIs at that … is uncertain – whether they’ll be annulled or made proprietary trades of …

How Canada Can Be A Global Leader In Blockchain Technology
The Globe and Mail

PLY: Interesting as it is authored by Don Tapscott.

The Next 100 Years On The JSE Won’t Be Like The Last 100
Moneyweb.co.za

The reality is that even over the last two decades returns from the JSE have started to lag those of other markets.

PLY: Interesting truly long-term perspective! To help those at market operators fixated with the next trimestrial results period,appreciate this: 100 years is, like, 400 quarters ahead.

Onwards towards what looks like an interesting week, ending with St Me’s Day Friday.

Many thanks for reading Exchange Invest.

Patrick

Patrick L Young
Executive Director DV Advisors

November 2017
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