March 31 2014


A bumper Q1 for European shares, the Bond shakeup is ongoing, HK in the eye of a growing storm? DB1 plays RMB catch-up with London while HFT will be aflame all week as Michael Lewis’ new book is published. CCPs urged to compress, 3 more LIBOR brokers facing incarceration compression… Meanwhile integration and disintegration issues continue for ICE as NYSE plays the New York media to try to sustain the agitprop it is viable in its current bloated format and Euronext gradually decouples. Various Indian issues as Blackstone amongst others begin pushing to oust Jignesh Shah from FTIL. Metals Warehouses, spot regulation, new appointments…

…Yip it’s a long one today with a lot of pith: can you afford to miss our free nuggets?

Oh and if you think our free daily is good value, please don’t hesitate to support the Premium Product & really leverage your knowledge! Plus your $120 helps keep the daily free… The latest five posts on Premium are:

New: Buying A Stake In MCX – A Guide For The Perplexed

New: Indian Commodity Exchanges – Background

Reflections On NYFIX: An Offer You Can’t Refuse?

CME Board: B Grade Reforms

(Updated 3/29/14:) Neither Fit Nor Proper: The FTIL Fire Sale

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Public Markets

ICE Out To Shrink Big Board To Sweeten Sale
John Aidan Byrne – New York Post

NYSE is skating on thin ICE — the new owner plans hundreds of exchange layoffs to slash costs, and sell some tech assets. The setback is not a good sign for the future existence of the financial institution, which traces its roots to a 1792 agreement under a buttonwood tree. The pink slips affect the six-figure jobs of high-tech programmers, and those of other staffers. But the bloodletting could go much deeper — and force the sale of the NYSE itself, Street execs say.

PLY: Here’s something lost in translation but then again to be fair the New York papers do a marvellous job supporting the TriState’s institutions. The problem is that they have missed the memo which points out that NYSE is a Dickensian organisation which despite a lot of surgery (especially under John Thain when he reversed them into Archipelago) the business needs ongoing radical invasive treatment and therapy to modernise and compete in a world where the NYSE brand is good but the rest of the organisation is, well, actually “organisation” is a generous description. True, NYSE is not Euronext but then again before the Thomson merger even Reuters executives reckoned it was a bit brutal to compare their management to that of Euronext… Yip, that’s as harsh a statement as I can recall in this industry.

Oh and “strong-willed” is the description for Jeff Sprecher (suspicious New Yorkers remain wary of out of towners clearly) but there is only one way forward – massive surgery and if that doesn’t work, dump the big board, it certainly is a brand but it needs to be a coherent business… (Oh and this change for NYSE is certainly not a “setback” I would call it a “liberation” myself – although many staid old hands within the big board are clearly struggling to come to terms with modernity).

ICE Splits NYSE Liffe, Euronext Feeds (subscription)
Giulia Lasagni & Faye Kilburn – waters technology

NYSE Euronext has introduced a new commercial model for real-time data from its Liffe derivatives market that will see London-listed derivatives unbundled from continental European derivatives, as a result of ongoing plans to spin off Euronext’s European cash and derivatives markets following ICE’s acquisition of NYSE Euronext last year.

PLY: Useful incremental progress. The question is how long before the Euronext options feed itself is unbundled to other competitors given the success of TOM and EUREX? The Euronext spin-off will create another competitor as LIFFE will endeavour to retake the single name options flow at the earliest opportunity… More reasons to be pessimistic about Euronext’s chances of thriving as an independent entity unless it can become something more than a puppet show manipulated by shadowy French government figures.

DB, Bank of China Agree Closer Cooperation

Deutsche Boerse and Bank of China are set to sign a strategic partnership agreement that would make it easier for Chinese and European investors to gain access to each other’s capital markets.

EI reported on March 27th that the Bank of England and Bank of China are to sign an agreement on renminbi clearing and settlement today. Deutsche Borse press release here.

PLY: China hedges by putting a back-up plan to encourage London to run with the RMB clearing ball while giving Mrs Merkel a few crumbs from the table which will encourage the DB1 pivot to Asia as I discussed in this Premium Post: Deutsche Boerse’s Asian Experiment. I also recommend this about DB1 in our Premium service: The Direction of Deutsche Boerse.

High-Speed Traders Rip Investors Off, Michael Lewis Says
Nick Baker & Sam Mamudi – Bloomberg
‘Flash Boys’ Starts Wall St Soul Searching (subscription)
Arash Massoudi & Tracy Alloway – Financial Times

The U.S. stock market is a rigged game where high-frequency traders with advanced computers make tens of billions of dollars by jumping in front of investors, according to author Michael Lewis, who spent the past year researching the topic for his new book “Flash Boys.”

…The prospect of a new book by the prolific former bond salesman turned chief scrutiniser, taking a hard look at the predatory world of HFT, is spurring industry participants to change their approach to a business that has revolutionised stock markets.

The release of Flash Boys: A Wall Street Revolt on Monday comes after years of public debate over the lightning fast trading systems which have grown to dominate a fractured terrain where multiple exchanges and bank-run trading platforms compete for orders.

PLY: HFT will return to the crosshairs and markets need to have coherent arguments to justify its existence while showing how the system can work for small and large investors, both of whom are in danger of alienation from organised markets. As an aside, I hear innovative new equity platform founder Brad Katsuyama (IEX) is oft mentioned in the new Lewis tome.

MCX Investors Band To Oust Promoter FTIL
Rajesh Bhayani – Business Standard

To oust the promoter of MCX, the country’s largest in the segment, some institutional investors are together planning to approach the authorities to expedite the process. Recently, these investors met the brass of the exchange and will hold a meeting of investors with one per cent or more stake in it — excluding the anchor investor, FTIL — on Wednesday to discuss the strategy.

PLY: Other shareholders are ramping up pressure on FTIL to sell their stake (and may be especially galvanised by news that FTIL is looking for a frothy premium to current market values). Thanks to subscriber demand, I put together some new briefs across the weekend on the MCX sell-off. Frankly, they are worth the annual subscription of $120 alone if you are even close to evaluating a stake in the MCX:

New: Buying A Stake In MCX – A Guide For The Perplexed

New:Indian Commodity Exchanges – Background &

(Updated 3/29/14:) Neither Fit Nor Proper: The FTIL Fire Sale


MCX Board To Consider Preferential Allotment Of Shares
Ravindra Sonavane – Livemint

The board of MCX will meet on 3 April to consider a preferential allotment of shares.

Exchanges Eye Up Bond Market Conversion (subscription)
Tim Cave – Financial News

PLY: As the fixed income market gains new entrants including exchanges and established platforms like Liquidnet, the vogue which began in Eastern Europe for exchange bond trading is pushing west: the fixed income dealer oligopoly is a citadel under attack. There is a very good quotation from the ever insightful Brian Taylor here, (who also expounded elegantly on bond market opportunities at the inaugural Young Markets conference 2 years ago):

“I think a lot of these exchange platforms may connect up a lot of people, but whether they will generate liquidity is questionable. On the supply side, there will be difficulty getting liquidity on to a platform without intermediation or market making. On the demand side, you may have some, but it is unlikely to be regular.”

Ex-ICAP Brokers Charged Libor Probe As Total Hits 14
Suzi Ring & Ben Moshinsky – Bloomberg

Three former ICAP brokers (Daniel Wilkinson, Colin Goodman and Darrell Read) will be charged by U.K. prosecutors for helping manipulate benchmark rates, 7 months after they were charged in the U.S. for similar offenses.

PLY: Given they were charged in the US first, does the UK have the opportunity to try them first and thus avoid double jeopardy with Trans-Atlantic trials? Alas so busy in the race to pixel, no time to check!

Banks Call For CCPs To Act On Compression (subscription)
Cecile Sourbes – Risk

With the leverage ratio making clearing members sensitive to gross exposure numbers, CCPs are under pressure to develop new, more efficient ways of compressing cleared portfolios. LCH.Clearnet has revamped its offering and rivals are expected to follow suit.

PLY: A key factor to ensuring we do not end with markets gummed up… It will be interesting to see how compression develops. Until now TriOptima has been the key player but given how much effort goes into front end algorithms, it may be prescient to send a few pointy headed maths bods to the back office, at least for a spell?

BoE Says May Revive Securitisation To Aid Recovery
Huw Jones – Reuters

The Bank of England may try to revive the securitised debt market to support the economic recovery, a policymaker said on Friday. Clara Furse, a member of the BoE’s Financial Policy Committee, said small firms are finding it hard to get loans from banks focused on meeting tougher capital requirements.

Expanding market-based finance, such as raising money by issuing securitised debt, would broaden the funding options for such companies, Furse said in her first speech since joining the committee a year ago. The FPC monitors risks in the broader financial system.

Dame Clara Furse Warns On Appetite For Equity (subscription)
Chris Giles – Financial Times

Low interest rates may be masking a long-term problem of low investor appetite for equity, potentially threatening to starve infrastructure and smaller companies of finance, a leading regulator at the Bank of England warned on Friday. Giving her first speech as a member of the BoE’s Financial Policy Committee, Dame Clara Furse, the former CEO of LSE, urged the committee to look beyond bank finance in its work.

PLY: Two views of the same speech and indeed the same problem. Part of Britain’s issue is that decades of tax shuffling has killed a lot of risk appetite: investors have been conditioned to expect a tax break when actually stopping the tinkering and removing or hugely reducing capital gains tax is the sensible way to go.

Q1 Equity Trading At Three-Year High In Europe (subscription)
Anish Puaar – Financial News

European stock trading is on course for its biggest first quarter since 2011, providing some respite for investment banks in a brutal quarter for fixed income.

PLY: A good quarter as equities are finally alight in London/Europe albeit with a still highly challenging macroeconomic picture in the Eurozone.

Hong Kong IPO Bankers Rush To Avoid Being April Fools (subscription)
Michelle Price – Financial News

Bankers and lawyers in Hong Kong are rushing to submit initial public offering filings to the local securities and futures exchange ahead of a new “name and shame” regime that comes into force tomorrow.

PLY: April Fools day takes on a whole new edge in Hong Kong as erroneous IPO paperwork will result in not merely rejection but naming and shaming too…

How Hong Kong Dropped The Listings Ball
Craig Stephen – MarketWatch

Hong Kong is still smarting from the loss of e-commerce giant Alibaba’s IPO to the U.S., which could raise a mouth-watering $15 billion with a potential $100 billion market cap. HKEx has at least claimed the moral high ground, saying it lost out by refusing to bend its listing rules.

That explanation has some merit, yet HKEx needs to do some soul-searching as to why some of China’s most exciting new companies are looking elsewhere. Not only is Alibaba heading to the U.S., but so is its main competitor, as well as China’s answer to Twitter, Sina Weibo.

PLY: We all know the Alibaba tale which may yet end badly in New York. However Craig Stephen forensically sifts the HKEx picture and notes the way the Issuer Marketing department has been closed as well as a seeming reversion to the old era of the red chips when the UK-Chinese handover approached in 1997.

China’s World-Beating IPOs Get A Little Help From The Regulators

China’s IPO are vastly outperforming IPOs in the U.S. and Europe so far this year — and investors can thank Chinese regulators for much of the gains. The 48 companies that completed IPOs in 2014 have surged an average 54% to date when adjusted for deal size, compared with a 9% gain for 194 first-time sales outside China – owing much to efforts by China’s securities regulator to protect small investors in an IPO process that had been riddled with fraudulent practices. Facing pressure from the watchdog, most companies that went public this year did so at below-average valuations as they rushed to raise money following a 15-month IPO freeze.

PSE Seeks Removal Of Tax On IPOs
Doris C. Dumlao – Philippine Daily Inquirer

More companies will go public if the government would scrap the costly tax of 1-4 percent on the gross proceeds of IPOs in the Philippines, the only country in Southeast Asia with such burden on stock debuts, the chief of the local stock exchange said.

LME Tightens ‘Chinese Wall’ Rules On Warehouses, Traders
Eric Onstad – Reuters

LME pressed on with reforms to its warehousing network on Friday, unveiling tighter “Chinese Wall” restrictions a day after a court ruling forced the LME to halt a plan to cut delivery backlogs.

PLY: It is at least good to see that political correctness has not affected a term which is meant as a sign of ongoing admiration for classical Imperial mural achievements. On the warehouse issue, LME need to get something sorted as they are now in a RusAl – government pincer trap which must be tricky.

Novelis Says Delay To LME Warehouse Rules Is ‘Very Destructive’ (subscription)

The UK high court decision delaying the implementation of LME’s proposed warehouse rule changes will be “very destructive” to the market, according to Novelis ceo.

Phil Martens said that the company, which supplies aluminium sheet and foil products globally, was very disappointed with the outcome of the legal process in the UK, particularly after working closely with the LME and other stakeholders for two-and-a-half years to push for changes. “Unfortunately, UC Rusal’s unilateral action resulting in this court decision will stifle the LME’s proposal to alleviate the unprecedented backlog at LME warehouses and will be very destructive to the market.”

CFTC’s Division Of Clearing & Risk Issues Time-Limited No-Action Letter For Singapore Exchange Derivatives Clearing Limited And Its Clearing Members

CFTC Division of Clearing and Risk (DCR) today issued a time-limited no-action letter to the Singapore Exchange Derivatives Clearing Limited (SGX-DC), a registered derivatives clearing organization.

PwC Is Sued For $1 Billion Over MF Global Collapse
Jonathan Stempel – Reuters

The administrator of MF Global Holdings Ltd’s bankruptcy plan on Friday sued the auditor PwC for at least $1 billion over its advice on a $6.3 billion European sovereign debt investment that helped fuel the brokerage’s rapid demise.

Private Markets

Einhorn Buys Stake In IEX
Nick Baker & Michael P. Regan – Bloomberg

Greenlight Capital Inc.’s David Einhorn invested in IEX Group, a five-month-old trading platform designed to address perceived flaws in the U.S. stock market, according to CBS Corp.’s “60 Minutes.”

IEX is “going to succeed in a very big way,” Einhorn said, according to a press release from the CBS news program. Gerald Lam, a spokesman for IEX, confirmed the investment by Einhorn’s New York-based hedge fund Greenlight. Einhorn declined to comment.

PLY: Amidst all manner of discussion about how there are too many venues in US equities, I happen to think IEX is part of the solution. Alongside, Liquidnet, ITG and a handful of others there are clearly beneficial models for investors being refined. IEX have a next generation market solution which has benefited from a lateral approach to the solution as opposed to merely being another me too discounter which always strikes me as pure systematic internalisation in every sense of the phrase.

Einhorn is demonstrating great prescience here. The IEX team are leading the field of equity market innovators.

TOCOM Announces Rolling Update Of Midterm Management Plan

TOCOM announced a new three-year Midterm Management Plan covering fiscal 2014 through fiscal 2016.

TOCOM Eyes Creation Of Japanese Mega Bourse (subscription)
Jonathan Watkins – FOW Intelligence

Tokyo Commodity Exchange (Tocom) is considering joining forces with its national counterparts to create a unified Japanese derivatives platform.

PLY: First step to NipponBourse Inc – does a single (plodding) monopoly make sense? …Or is it just a prelude to next generation competition (presuming Japan allows that of course).

American Civics Exchange Wants To Take The Risk Out Of Politics (subscription)
Frances Denmark – Institutional Investor

PLY: Fran Denmark profiles American Civics Exchange (ACE) and interviews co-founder Flip Pidot as well as quoting yours truly for some perspective given my previous dabbling in the field as a co-founder of Intrade…

NCDEX Spot Exchange Ties Up With SBI For Pledge Finance
Business Standard

NCDEX Spot Exchange, a subsidiary of NCDEX, today signed an agreement with State Bank of India to promote financial inclusion through an electronic pledge facility that will enable farmers and traders to use their goods stored in an approved warehouse as financial assets.

PLY: As I will not tire of stating: India needs to pivot its commodity markets back to the initial promise of servicing the small farmers. This is an excellent move in that direction by NCDEX Spot Exchange.

Tokyo Court Extends Mt. Gox Bankruptcy Investigation To May 9

A deadline for a court-mandated investigation into why bitcoin exchange Mt. Gox failed, and whether it should be revived under bankruptcy protection laws, has been extended to May 9.

MtGox Lost ‘Barely 386 Bitcoins’ Due To Cyber Attacks – Not 850,000
David Gilbert – IBT

A study carried out by the Swiss Federal Institute of Technology in Zurich has concluded that, at most, MtGox lost 386 bitcoins in cyber attacks trying to take advantage of the transaction malleability flaw inherent in the bitcoin source code – not the 850,000 bitcoins CEO Mark Karpeles claims.

The study, carried out by Christian Decker and Roger Wattenhofer, looks closely at all bitcoin transactions from January of 2013 to February of this year.

PLY: Uh oh, something really doesn’t add up here…

Mt. Gox Faced Questions On Handling Client Cash Long Before Crisis
Sophie Knight & Nathan Layne – Reuters

Two years before Mt. Gox filed for bankruptcy, a half dozen employees at the Tokyo-based bitcoin exchange challenged CEO Mark Karpeles over whether client money was being used to cover costs, according to three people who participated in the discussion…the issue raised by staff in the showdown with Karpeles in early 2012 remains crucial to unravelling a mystery under examination by authorities in Japan.

A bankruptcy administrator and police are seeking to determine how a Tokyo start-up that shot from obscurity to dominate global trade in bitcoin managed to lose more than $27 million in old-fashioned cash held in a bank as well as bitcoins worth close to $450 million at today’s prices.

PLY: …sadly the suggestion is the perplexing equation may be balanced by a rather ugly old line co-mingling… Is it another ‘new paradigm, same old fraud’ story?

Africa’s Digital Money Heads To Europe (subscription)
Daniel Thomas & Katrina Manson – Financial Times

The mobile payment system that has revolutionised business and banking in sub-Saharan Africa is to come to Europe as Vodafone seeks to spread the popular digital currency outside emerging markets. Vodafone has acquired an e-money licence to operate financial services in Europe, with plans to launch M-Pesa (which means mobile money in Swahili) in Romania as a first step to potential expansion in the region.

M-Pesa has become so popular in parts of Africa that it is now a virtual currency, offering a secure means of payment for people who do not have easy access to banking services. A mobile phone text message is all that is needed to pay for everything from bills and schools fees to flights and fish, and means that the mobile phone can double as an office for the continent’s smaller entrepreneurs. Vodafone now hopes to win over an estimated 7m Romanians who mainly use cash.

PLY: Good place to start after Africa; Romania. Seriously, it makes a lot of sense.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX is up 1.5%, FTIL is flat. Interesting to note that the MCX share price is not tangibly closing the gap to the circa 100% premium being sought by FTIL as it offers its 24% stake (under not ‘fit and proper’ duress). Meanwhile the pressure is on Jignesh as he may be forced out of the FTIL executive even if he doesn’t sell his stake in his original brainchild…

Stung By NSEL, Govt May Withdraw Waiver To Bourses
Shaji Vikraman & Ram Sahgal – The Economic Times

Seven years after it granted a waiver to national spot exchanges from regulatory oversight, the government is set to withdraw the controversial exemption to prevent a potential repeat of the Rs 5,500-crore payment crisis on NSEL.

PLY: The government is right to withdraw its waiver and a proportionate regulatory regime would be good to advance confidence in the spot exchange sector. The difficulty is that harsh micromanagement is the only language the Indian regulatory complex understands. Thus we have a sensible idea which may end up with a typically overly prescriptive crackdown.

Bharat Sheth, Ravi Sheth, Blackstone Want Jignesh Shah To Step Down
Sugata Ghosh & Ram Sahgal – The Economic Times

Bharat Sheth, Ravi Sheth and private equity house Blackstone, with a combined shareholding of more than 15% in FTIL, have threatened legal action against the company’s board of directors, insisting that chairman and CEO Jignesh Shah should step down and the company bring in a strategic partner while refraining from selling its stake in commodity exchange MCX.

PLY: The credibility of Jignesh Shah – even if he emerges unscathed from all possible legal attacks ahead of him – is shot. Reputable investors like Blackstone are unsurprisingly keen to be rid of him to allow management to concentrate on building value in an FTIL that serves customers, as opposed to being embroiled in what may be a decade or two of legal challenges (if previous Indian scandals are any form of benchmark).

‘CBI Is Floating Trial Balloons To Somehow Justify The PE’
The Indian Express

Former Sebi chairman CB Bhave says the agency could have avoided the public spectacle by contacting him first, and wonders whether it is a diversion away from the real culprits in the NSEL case.

Corporate Affairs Ministry To Ascertain Whether FTIL Violated Norms

The Ministry of Corporate Affairs is looking to ascertain whether Jignesh Shah-led FTIL violated laws, especially with respect to carrying out its duties as a holding company, according to sources.

NSEL Investors’ Forum Looks To Modi As Beacon Of Hope
Business Standard

NSEL investors waiting for money for three quarters have now found hope in Bharatiya Janata Party (BJP)’s prime ministerial candidate Narendra Modi. The NSEL Investors Forum wrote a letter to Modi giving him best wishes for the polls and wishing he will be the next prime minister.

PLY: What would a PM Modi look like? Until recently a pariah in western eyes, he could form a government during May and I really am not sure how that looks for markets but it could be a protectionist approach which will further restrict India’s exchange industry when it needs a liberal competitive internationalist approach to reach its potential.


Polenergia Obrót Selects Trayport’s GlobalVision Trading Gateway

Trayport announced that Polenergia Obrót are now using GlobalVision Trading Gateway through a Software as a Service (SaaS) delivery model, for power trading in Central and Eastern Europe (CEE).

PLY: Another good result for Trayport and in particular their Warsaw office.

CloudMargin Links To TriOptima
James Rundle – waters technology

Cloud-based collateral management specialist CloudMargin has connected to TriOptima, in order to handle reconciliations.

The provider has established a link with triResolve, which will enhance its post-trade offering through collating and enriching data from a variety of sources, then linking it with the reconciliations process through the ICAP-owned vendor’s product.

DSE And STT Contract

Securities and Trading Technology (STT), a leading African technology solution provider, is pleased to announce that it has signed a contract with the Dar Es Salaam (DSE) Stock Exchange to provide the Tanzanian Exchange with integrated trading, clearing and settlement technology.

PLY: Great news from Michelle Janke, Louisjan Bonthuys and the STT team marking another step forward for African markets.

‘The Ugly, The Bad & The Not So Good’ Of Indian IT Sector
Business Standard

In its report on Indian infotech sector “The underbelly of Indian IT” dated March 24th, Ambit Capital research team has categorized the companies in three categories calling them – the ugly, the bad and the not so good based on their corporate governance report.

PLY: FTIL gets a mention in the “ugly” section with a note in this article bluntly noting: “Suspicious subsidiary accounts; corporate governance concerns.”


SIX Swiss Exchange Now Also Offers Actively Managed ETFs For Trading

From 31 March 2014, in addition to passive ETFs that track the prices and returns of underlying indices, it will also be possible to list and trade active ETFs on SIX Swiss Exchange. Swiss & Global Asset Management is offering eleven active ETFs for trading on SIX Swiss Exchange as the first issuer.

Memorandum Paves Way For Electricity Futures Contract

Shanghai Futures Exchange has signed a memorandum with the China Electricity Council in preparation for the country’s first futures contract for electricity.

Vietnam To Open ETFs To Pull In Investors
Shanghai Daily

Vietnam will allow exchange-traded funds (ETFs), a form of modern derivatives products, to be used later this year in a fresh bid to attract investment inflow into the country, the State Securities Commission said Friday.

Career Paths

Euronext announced the appointment of three leaders for its financial derivatives, commodities and cash businesses with effect from 1st April 2014, all of whom will report to Lee Hodgkinson, Head of Markets and Global Sales.

Adam Rose will be appointed Head of Financial Derivatives at Euronext. He is ex-Goldman Sachs, and Commerzbank, and for the past seven years was MD at ABN Amro, he will be based in Amsterdam.

Olivier Raevel, will be appointed Head of Commodities at Euronext (based in Paris). He began his career at Société Générale, and was a founding Board member of ICE. Following this, he worked for ABN Amro in London structuring OTC Commodities. He traded energy derivatives for three years at Koch Supply & Trading in Geneva.

Danielle Ballardie will be appointed Head of Cash Equities at Euronext. Danielle has been leading the sales and client coverage team in London for Euronext since 2012 and will be based in London.

Euronext press release here.

Aquis Exchange has appointed David Attew as its new head of regulation. He joins from NYSE Euronext’s SmartPool. David replaces Jennifer Wood, who is expected to remain a consultant to Aquis Exchange following a period of maternity leave. David has been compliance officer at SmartPool since 2010 and prior to that worked for All IPO Plc.

Aquis Exchange press release here.

LME announced that Barbara Dohmann QC has been elected as a Member of the LME Appeal Panel with effect from 19 March 2014 for a five year term.

CalPERS has named Tom McDonagh Acting Senior Investment Officer (SIO) for Real Assets, effective April 1, 2014.

WSE To Get New CEO In June?
Warsaw Business Journal

The term of the present management board of WSE expires in June. Unlike in previous terms, the new CEO will not be chosen in a competition, but by the WSE’s EGM, and a lot of speculation has appeared as who could lead the bourse in the future.

Media have mentioned Andrzej Jakubiak, head of the FSA, and Paweł Tamborski, deputy minister of treasury, as possible candidates. Another name that is sometimes is brought up is Jacek Socha, former treasury minister and partner at PwC.

Current CEO Adam Maciejewski was appointed early last year after his predecessor Ludwik Sobolewski had been dismissed. At that time, former WSE CEO [PLY: now Chairman] Wiesław Rozłucki was also a candidate. He now denies any interest in such a position.

PLY: I discussed the precarious nature of many exchange CEOs in the Premium Post: 2014 – A Year of Unprecedented Executive Change? while some dangers in the Warsaw model are discussed in this premium post: Warsaw’s Great Leap Backwards. Overall the EGM is a bit of a feint to ramp up the pressure on Adam to deliver the daft Viennese merger which the government wants and the local community is increasingly voluble in (sensibly) opposing this daft diversion which will fundamentally damage Warsaw as an exchange and more broadly as a financial centre. Note the government controls a majority of the votes through their mini-Alibaba voting structure, while holding circa 40% of the equity. Given that none of the candidates being mooted have demonstrated any understanding of running an exchange, I fail to see any merit in their candidacy.

Financial Calendar


ICE $0.65 Q1 dividend payment

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

Analyst Notes

ICE Enters Oversold Territory

In trading on Friday, shares of ICE entered into oversold territory, hitting an RSI reading of 27.5, after changing hands as low as $195.34 per share. By comparison, the current RSI reading of the S&P 500 ETF (SPY) is 53.1. A bullish investor could look at ICE’s 27.5 RSI reading today as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side

A full table of current analysis can be found on our Analyst Ratings page which is updated daily.

All Analysts, Banks and Brokers are welcome to contribute to this section.

Other stories

Wall Street Transcript Interview with Colin Heffron, GFI Group Group (subscription)
Yahoo Finance

In the following excerpt from The Wall Street Transcript Investment Banks and Asset Management Report, the CEO of GFI Group Inc. (GFIG) discusses company strategy and the outlook for this vital industry.

ASX Lodges Submission To The Financial System Inquiry

ASX has today lodged its submission to the Financial System Inquiry. The Inquiry comes at an important time, with the global regulatory and competitive environment evolving significantly in recent years. Choices can be made now to secure the future of Australia’s financial markets and make the most of the opportunities in Asia.

PLY: A protectionist monopoly for Australia is the only solution, says ASX.

Kilburn’s Corner: Abandonment Issues (subscription)
Faye Kilburn – waters technology

PLY: It strikes me the management challenge here will be an eagerness on the part of NYSE or Euronext to try to blame any failings on their ICE parent – it requires delicate management from the ICE side.

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