MARCH 2 2017

Even if you barely know cars, let alone Porsche cars, you know that issue 944 of Exchange Invest celebrates a fabulously elegant front engined coupe which is still capable of modification to keep up with lots of much pricier machinery even today. Great machine, 2.5 litre 4 cylinder engine based around the 924 GT Le Mans car which we discussed last week as 939.

In Today’s Exchange Invest

Post merger fallout as the parties continue to go through the motions awaiting big brother’s bullet in the back, DB1 might be renamed “Denial Bourse 1” unless they start listening to even the Hesse Finance Minister in a growing chorus noting the status quo won’t do and it certainly won’t restore faded glories.

Elsewhere new appointment for Kay Swinbourne, CBOE closes BATS deal, thus Bill Brodsky stands down as Chairman as agreed, Martin Abbott metals venture in partnership with Autilla….

In BigWorld

President Juncker has presented a document on “Avenues of Unity” which appears more doctrine for managed decline rather than a bold blueprint for 27 nation prosperity, as the EU struggles to survive post Brexit and all those other existential threats the EU has failed to manage for a decade. Perhaps “Cul de Sacs of Change” might have been a more apt name for this defeatist tome.

Public Markets

CBOE Holdings Announces Close Of Acquisition Of BATS Global Markets
BATS

PLY: So farewell then BATS as an independent entity, the new tie-up looks a fascinating opportunity for CBOE to advance…

Moscow Exchange Announces Results For The Full Year 2016
MondoVisione

Anthony Hilton: Reasons To Be Pleased As The LSE-Deutsche Merger Unravels
Evening Standard

PLY: Good pith, the Evening Standard retains an elan for financial writing. Anthony Hilton revisits the point about how large has overlooked small and ecosystems have been killed in the dash for national/international behemoths…I would also argue the truth is the mega mergers are coming to an end but the opportunity now is in exchanges too small for the megabourses to be able to exploit up front.

LSE & Deutsche Börse Reconsider Their Solo Options
Financial Times

PLY: Good article albeit suggests that CME was rebuffed in trying to acquire DB1 in 2012 which is, well, let’s say not quite the way the story goes when you are even much distance beyond Eschborn.

The disgusting statistic for which both DB1 and LSE CEOs ought to be held accountable is the dismal waste of fees – the 370 million Euro estimate is apparently lower than the likely result (albeit hard to tell who is affected by ‘no win no fee’ or other closure incentives). All the same this has been a massive and farcical waste of time, resources, energy and money from 2 bourses who are eager to cast themselves as fiscally responsible, if not parsimonious on expenses.

Deutsche Börse Chief: We Will Be Fine Without The London Stock Exchange
Evening Standard

PLY: Fairly standard fare really – DB1 regrets; claims it is prepared for the future (can’t say I agree but they could get match fit in all divisions if they want to – just needs an outbreak of management) while the media continues to parse Xav’s dream that the LSE will now be acquired by somebody from the USA (qv another round of that parlour who can pass antitrust in Europe? – clue: well, I doubt MGEX can raise the finance…).

Back To Square One For Deutsche Börse
Handelsblatt Global Edition (subscription)

Carcrash (at the SME market launch) stated:

“We are working flat out on our [Accelerate] strategy. Nothing has changed on that. What we have to do is completely clear. We have to get Deutsche Börse back into the leading group of international [exchanges operators]. That is where it belongs, and that is our goal. We want to strengthen Frankfurt as a financial centre… This new segment Scale is one of the many examples for this that we have given in the last 18 months. Standing still is not an option.”

PLY: We all want to see DB1 regain its foothold having now spectacularly decoupled from its longstanding position in the top tier (it’s not even on the cusp of the top tier any more, it is distinctly in the second segment of the pyramid) but I think the Hesse FinMin makes pertinent points above. DB1 does not have a coherent strategy currently other than arguably to behave more like an investment bank.

As to “Accelerate” I think “Substance” is useful first.

Deutsche Börse Group Further Optimises Its Shareholding Portfolio
MondoVisione

PLY: A little good news for Frankfurt as DB1 sells remaining shares in the now merged CBOE-BATS as a result of legacy ISE/Direct Edge holdings.

Madrid Bourse Says More European Exchange Consolidation Difficult
Reuters

“We are not in a rush to do anything specific at this moment,” BME GM Javier Hernani said.

Japan Exchange Group: Status Of Acquisition Of Own Shares
MondoVisione

Thomson Reuters Intends To Purchase Up To 6 Million Shares Through Private Agreements – Purchases Will Be Part Of Previously Announced Buyback Program
MondoVisione

Five Key Things New Sebi Chairman Ajay Tyagi Should Do
Business Standard

These includes finalising the National Stock Exchange (NSEs) co-location matter and bringing some key regulatory changes in the commodity market.

Private Markets

Former LME Chief Seeks To Create Trading Platform With Autilla
Financial Times

PLY: So Martin Abbott is more advanced with Autilla having talked with ICE (according to Reuters yesterday).

Thai Stock Exchange Uses Blockchain For New Startup Marketplace
Finextra (press release)

The Stock Exchange of Thailand (SET) is planning to launch a blockchain-based marketplace for startups later this year. The platform, set to go live in ..

Institutional Squabbles Cast Shadow On Bourse
The Island.lk (subscription)

Seeming differences of opinion between the Ministry of Finance and the Central Bank are casting a negative signal for the Colombo Stock Exchange…

South Asian Stock Exchanges Mull Interconnected Markets At Sri Lanka Forum
EconomyNext

Trying to Create The Next Unicorn? Start by Asking “WTF”
AlleyWatch

PLY: Liquidnet founder Seth Merrin promoting his new book by discussing an acronym which as I mentioned before may stand for “Whither This Farce?”

Taking Stock Of Indian Exchanges
Hindu Business Line

PLY: Useful background if you are not au fait with Indian exchanges post BSE listing and ahead of the NSE listing.

Special Section: FTI, NSEL, India at the Crossroads

Nada.

Technology

Old School Trading Pits To Remain After High-Tech Exchange Deal
Bloomberg

PLY: Arguably overstates the importance of the pits and floors which are nowadays largely there for show / CNBC.

Turquoise Selects QuantHouse To Extend Turquoise Plato™ Midpoint Matching Services Across Europe

Dash And Liquidpoint Complete Merger To Create Dash Financial Technologies
PR Newswire (press release)

Products

Moscow Exchange Expects Firms To Start Directly Trading Fx In March/April
Reuters

LME Announces Fee Schedule And Latest Clearing Members For LMEprecious
MondoVisione

Deutsche Börse Launches New SME Segment “Scale”
DB1

PLY: Clearly DB1 can only be judged on a commitment to SMEs over the full cycle. LSE has that, DB1 management have in the past abandoned their SME markets at the first sign of angry stockholders losing money in the downturn.

More Study Needed Before Allowing Commodity Trading In Gift: CDAC
Moneycontrol.com

Career Paths

PLY: The NEX optimisation subsidiary of Michael Spencer’s prettiest girl at the prom group, has appointed MEP Kay Swinbourne to chair their new regulatory think tank NEX Reg. – Good move La Swinbourne, as befits a Welsh Conservative, has a broad perspective on issues.

The Channel Islands Stock Exchange en route to renaming itself as The International Stock Exchange in the next week, has announced that Deputy Chairman Stephen Lansdown will step down from the board with effect from the Annual General Meeting in June to focus on his other significant business interests while Isle of Man-based Anderson Whamond has joined the board with immediate effect.

Green Key technology has appointed Nader Shwayhat (ex-Pivot, CME) as CEO, replacing Paul Christensen who was CEO from March to September last year.

RSRCHXchange Appoints New Board Members Including Former Instinet Europe CEO Adam Toms – Hires Ex-UBS Head Of Research

The UK Prudential Regulation Committee board which supercedes the PRA board will retain the same members as before:

Chairman: Governor Mark Carney

Sam Woods, Deputy Governor, Prudential Regulation and Chief Executive of the PRA

Sir Jon Cunliffe Deputy Governor, Financial Stability

Charlotte Hogg Deputy Governor, Markets & Banking

Ben Broadbent Deputy Governor, Monetary Policy

​Andrew Bailey Chief Executive of the Financial Conduct Authority

External Members are:

David Belsham, Sandra Boss, ​Norval Bryson, ​Charles Randell, David Thorburn and Mark Yallop.

Bursa Malaysia Berhad Announces Appointment Of Directors To Its Subsidiaries

An Interview With Bill Brodsky

WFE Magazine

An interesting farewell interview from the retiring Brodsky, now the BATS-CBOE deal is done. Good luck to Bill and all the best to CBOE in its new era which has already been clearly defined as a break with the past by CEO Ed Tilly.

Crowdfunding

Peer-To-Peer Loan Groups Told To Stop Lending To Each Other
Financial Times

BrickVest Announces £2m First Closing Of Its Second Financing Round – Round Upsized To £4m To Accelerate Growth
MondoVisione

Other Stories

UK Watchdog Proposes IPO Research Shake-Up To Level Playing Field
Nasdaq

Efficiency And Effectiveness: Our Approach To Primary Markets – Speech By Christopher Woolard, Executive Director Of Strategy And Competition At The UK Financial Conduct Authority, Delivered At Bloomberg.
FCA

SEC Approves Rules To Ease Investor Access To Exhibits In Company Filings
SEC

PLY: I have not looked at this closely but it strikes me as very sensible.

Financial Globalisation Is Alive And Must Be Kept Intact – BIS
Reuters

Enjoy your Thursday…

Best wishes,

Patrick

Patrick L Young
Executive Director DV Advisors

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