April 12 2016

elb2CETIP deal done. XavRol’s outbursts continue to reverberate as Germans concern themselves about the loss of influence with DB1 sensibly preferring the bigger financial centre of London (German protectionism is alive & well…).

Meanwhile the BATS IPO is apparently already oversubscribed with several days to go.

…Next week it’s the ICDA Blockchain conference: last call for a GBP 320 discount ticket (normal price GBP 695) use the code “YOUNG320” to claim your discount here.

Public Markets

BM&FBOVESPA & Cetip Announce Agreement To Combine Operations

MondoVisione

BM&FBovespa Seeks Loan To Fund Cash Part Of $3.6 Billion Cetip Deal

Reuters

BM&FBovespa is arranging loan financing to fund part of the 12.9 billion reais ($3.6 billion) that rival Cetip could cost, a sign that the cash portion of the deal may increase.

BM&FBovespa CEO Edemir Pinto said at a Monday news conference to announce the deal, that about 75% of the proposed amount could be paid in cash. However, that could rise to 85% due to a provision to protect Cetip shareholders from fluctuations in BM&FBovespa’s stock price. Pinto, who would run the combined entity, declined to elaborate on terms of the loan financing deal. BM&FBovespa is also using $1.2 billion in proceeds from the sale of a stake in CME to fund the Cetip takeover.

QV Premium: BMF&Bovespa Monopoly – Brief and  Exchange Deals Brief.

PLY: Confirming a mega merger in Brazil just as the macro political situation hits a denouement with the nation’s President in danger of impeachment.

 

LSE’s Rolet Strikes Back at Reports Company Would Be Dismantled

John Detrixhe – Bloomberg

PLY: Bloomberg got an interview last week where Xavier tried to roll back the damage done by his remarks published last week but chose to focus mostly on the original remarks.

‘LSE Must Be Based In Frankfurt’: Now German Politicians Pressure DB1 To Reject ‘Merger Of Equals’

James Burton – Daily Mail

QV Premium: DB1-LSE Merger Brief.

PLY: Mail tweaks the British angle just as it becomes ever clearer that the politics of this deal are hypermessy. German hyperconfidence leads them to believe Frankfurt is a major international financial centre while insecure British salarymen fret the city might lose its millennia of interest against a background of a possible exit from an EU which will anyway likely fail. Either way it’s tricky for DB1’s acquisition of LSE as Germany intends to prevent it diluting its German position.

 

Senate Committee To Take Up Bill On CFTC

Reuters

A U.S. Senate committee will soon consider legislation on CFTC that is intended to keep financial-sector restrictions in the Dodd-Frank Wall Street reform law from applying to farmers and ranchers because their derivatives trading helps them manage operational risks.

On Thursday, the Agriculture Committee will mark up legislation reauthorizing CFTC, which oversees the $400 trillion U.S. swaps market as well as trading in agriculture, metals and energy.

 

ISDA’s 31st AGM to Highlight Impact of Market Structure Changes

BUSINESS WIRE

 

Comment: Time To Reform Deficient Market Structures (subscription)

Financial Times

Lessons from Libor can be applied to other critical daily operations.

 

Regulator Mulls Single Licence For Equity, Commodity Brokers

Shrimi Choudhary – Business Standard

Though both security and commodity market intermediaries are now regulated by Sebi, following the absorption of Forward Markets Commission (FMC) into it, they still adhere to different guidelines and requirements. Sebi has initiated an exercise to have a common set of these.

 

EEX: Introduction Non-MTF Market – Additional Information

MondoVisione

Private Markets

Bats Global’s IPO Said to Be Oversubscribed

Alex Barinka & Drew Singer – Bloomberg

Bats’ IPO is oversubscribed, three days before the sale is due to price. The deal has demand from investors for at least five times the number of shares being issued.

 

What Action Should Sebi Take In NSE Algo Trading Case

Mobis Philipose – Livemint

Sebi could be tempted to summarily announce some additional checks and balances in algorithmic trading. But this won’t solve the problem. It needs to dig deeper; help of an expert is imperative.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX and FTIL flat.

Technology

How to Prove You’re Bitcoin Creator Satoshi Nakamoto

WIRED

Four months have passed since the world learned the name of Craig Wright, a man who either created Bitcoin or very badly wants someone to believe he did.

Now rumors are swirling through the Bitcoin world that Wright himself is poised to publicly claim—and possibly offer some sort of proof—that he really is Satoshi Nakamoto, the mysterious inventor of Bitcoin. If he does, he’ll have to convince a highly skeptical cryptography community for whom “proof” is a serious word, and one that requires cryptographic levels of certainty.

Products

ICE Benchmark Administration Adds Industrial & Commercial Bank of China as a Direct Participant to IBA’s Gold Auction

ICE

 

CME Adjusts Black Sea Wheat Market As Euronext Threat Looms

Tom Polansek – Reuters

CME will list three new contract months in its Black Sea wheat futures market and eliminate a delivery location as the U.S. exchange operator faces a potential challenge from Euronext NV (reported yesterday)…Starting with the July 2016 contract, the company will remove Crimea’s Port of Sevastopol as a delivery location.

 

HKEx Plans To Launch Asian FX Futures, Gold Contracts

Reuters

Hong Kong stock exchange plans to launch renminbi currency futures contracts against the Indonesian rupiah and the Malaysian ringgit in the coming months.

 

Nomura Planning to Withdraw From European Equity Business

Takahiko Hyuga – Bloomberg

Career Paths

President of the Management Board of BondSpot Jacek Fotek has resigned on 11 April 2016. GPW MD for Development Izabela Olszewska has been delegated as acting President of BondSpot. She is a current Member of the company’s Supervisory Board.

PLY: Interesting times at GPW as clearly the CEO is trying to change – the results will be interesting to observe.

SEC announced that Marshall S. Sprung, co-chief of the Division of Enforcement’s Asset Management Unit, is planning to leave the agency later this month.

Celeste Koeleveld has been appointed General Counsel at the Department of Financial Services (DFS). Ms. Koeleveld will lead DFS’s Office of General Counsel and be responsible for all legal matters in the agency, reporting directly to the Superintendent.

Markets Media reports that BGC Partners has hired Troy Kane, the former COO of prop trading firm Eagle Seven. Kane is charged with growing the firm’s algo trading business.

HKEx Crosses The Line In Showing Preference Among Candidates In Board Election (subscription)

Enoch Yiu – SCMP

HKEx has called for shareholders to vote down a candidate seeking election to its board, a move that sets a bad example.

This column would continue to report the latest twist of the battle of the HKEx director election on April 28 between HK fund manager Edward Chin Chi-kin and London-based metal firm head Apurv Bagri (discussed last week). Chin is known to the HK public as a supporter of the Occupy Central movement in 2014. Bagri is less known to the local community but is well known among the commodity trading circles in London.

The pair are in a race for a board seat left vacant by veteran fund manager Oscar Wong Sai-hung’s retirement.

PLY: As I race to pixel, I am not sure how HKEx taking sides is different to, for example, CME having its Politburo decide who are approved candidates, to take but one example?

Financial Calendar

11 – 17.04 – Coinsilium’s Blockchain Tech Lab at Runway East at Finsbury Square, London

12-14.04 – ISDA AGM – agenda  

19 – 20.04 – ICDA Blockchain Conference

20.04 – SGX Q3 Results FY2016  

21.04 – I-Cham Breakfast, in Dublin, Ireland, Guest Speaker Patrick L Young discussing investment in CEE & SEE markets  

26.04 – CFTC’s Market Risk Advisory Committee – agenda

New! 09.05 – TMX Q1 2016 Results – press release

All forthcoming exchange / investment related events are now listed in our Events page.

Other stories

MCX, Dalian Commodity Exchange Ink Pact To Extend Strategic Co-Operation

The Economic Times

MCX and the Dalian Commodity Exchange (DCE) have signed an addendum to their existing MoU to extend strategic co-operation.

 

Innovate Finance Global Summit – Speech By Christopher Woolard, FCA Director Of Strategy & Competition, 11 April 2016.

MondoVisione

 

New York Attorney General Eric T. Schneiderman-Led State & Federal Working Group Announces $5 Billion Settlement With Goldman Sachs

MondoVisione

 

U.S. Justice Department: Goldman Sachs Agrees To Pay More Than $5 Billion In Connection With Its Sale Of Residential Mortgage Backed Securities

MondoVisione

 

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