May 26 2016

elb2This morning’s Pith comes live from the Finance Malta Conference. Meanwhile, the FESE Convention, is upcoming at the same (let me add: excellent) venue, Malta, 15/16th June while ICDA have already delivered a discount code for their upcoming CyberRisk conference in London, July 20th: Secure a place at GBP 295 with the code YOUNG295.

Perhaps surprisingly SGX is in pole position for the Baltic – good for them –  while Markit has apparently received regulatory approval for its coupling with IHS as well as scaling up its index administration arm…interesting stuff.

Public Markets

Selling Out? No, the Baltic Exchange Is Truly Global

James Quinn – Daily Telegraph

SGX In Talks To Buy London’s Baltic Exchange

Anshuman Daga & Jonathan Saul – Reuters

SGX is in exclusive talks to buy London’s Baltic Exchange.

Earlier on Wednesday, sources told Reuters the Baltic and SGX had entered into advanced talks, with one putting the value of a potential deal at about $100 million.

The Baltic and SGX said in a statement later they had entered a period of exclusivity which would expire on June 30. In February, the Baltic confirmed it had received a number of “exploratory approaches” after SGX said it was seeking to buy it. LME, CME, ICE, state-run conglomerate China Merchants Group and Platts were among other potential bidders.

SGX Buys Flashy London Address

David Fickling & Andy Mukherjee – Bloomberg

What does Singapore’s bourse hope to get out of its takeover of the Baltic Exchange?

On the face of it, a lot. Faced with stagnating revenues from its securities business, Singapore Exchange has been looking to diversify its revenue base. But since its attempt to purchase Australia’s ASX was blocked by that country’s Treasurer in 2011, its only completed takeover has been the city-state’s energy-trading platform from the government in 2014.

There’s also a geographic logic.

 

Markit In Letter To Employees Says Received All Regulatory Approvals IHS Merger

Reuters

Deal announced in March.

QV Premium: Exchange Deals Brief – M&As.

 

Citigroup To Pay $425M To End CFTC Benchmark Probes

Matt Robinson & Matthew Leising – Bloomberg

Citigroup will pay $425 million to resolve CFTC claims that the bank attempted to manipulate global benchmarks for interest-rate products multiple times from 2007 to 2012.

CFTC Orders Citibank to Pay $250 Million for Attempted Manipulation & False Reporting of USD ISDAFIX Benchmark Swap Rates

CFTC

CFTC Orders Citibank, N.A. & Japanese Affiliates to Pay $175 Million Penalty for Attempted Manipulation of Yen LIBOR & Euroyen TIBOR, & False Reporting of Euroyen TIBOR & USD LIBOR

CFTC

 

Nasdaq Slams Recommendations To Restrict Market Jurisdiction (subscription)

Nicole Bullock – Financial Times

SEC advisory group did not include input from NYSE and Nasdaq.

PLY: Entirely inevitable, when you exclude the largest markets from the discussion they can easily discredit the whole process. Good use of government money – not.

 

U.S. Lawmakers Add Fuel to Old Spat Between Brokers, Exchanges

Elizabeth Dexheimer & Annie Massa – Bloomberg

New legislation is intensifying an old fight between two powerful forces on Wall Street: stock exchanges and brokers. So far, the brokers seem to be winning this battle.

A bipartisan bill under development in Washington would weaken stock exchanges’ grip on a key part of trading: the data feeds that provide the backbone of the market. Brokers complain exchanges have abused their control of the services to pad their revenues. If passed, the legislation would give brokers a greater voice in overseeing those information sources and other critical features of the stock market.

 

BGC Partners Announces Pricing Of $300 Million Of 5.125% Senior Notes Due 2021

BGC Partners

 

CME Looks to Challenge The Venerable LME

Stuart Burns – MetalMiner

The fact the CME is looking to expand its warehouse network should come as no surprise, the fact it has taken it so long to do it should.

Private Markets

Budapest SE Sees Authority Broadened By Parliament

Christian Keszthelyi – Budapest Business Journal

The Hungarian Parliament yesterday voted to approve modifications to laws regulating the financial intermediary system, as well as broadening the authority of the Budapest SE (BSE).

 

India – Regulator To Clean Bourses Of Suspended Firms

Rajesh Bhayani – Business Standard

To allow exit for shareholders of the 1,200 companies.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX and FTIL flat to small up.

Technology

India Plans Rules to Hobble High-Speed Trading Firms’ Advantage

Santanu Chakraborty & Arijit Ghosh – Bloomberg

SEBI mulls speed bumps, micro-auction system to delay trades; new measures will be implemented in next three to four months.

Products

Beijing Vows To Open Commodity Futures Trade To Foreign Investors (subscription)

Daniel Ren – SCMP

Beijing pledged to take a major step forward in liberalising its commodity futures market by allowing foreign investors and domestic financial institutions to deal in contracts that bet on prices for crude oil, iron ore and rubber.

PLY: Liberalisation part of an ongoing Chinese theme, with a clear international ambition:

China Wants to Set Prices for the World’s Commodities

Bloomberg

“We’re facing a chance of a lifetime to become a global pricing center for commodities,” Fang Xinghai, Vice Chairman of the China Securities Regulatory Commission, said at the Shanghai Futures Exchange’s annual conference in the city on Wednesday. “On the way to realize this goal, we’ll see very intense competition. We have the advantage of trading size and economic growth, but our legislation is still not sound and we lack enough talent.”

 

SEC Bans Broker-Dealers From Retail Forex Transactions

LeapRate

LeapRate Exclusive… SEC has quietly filed a notice indicating that as of July 31, broker-dealers will no longer be able to engage in leveraged fx transactions with traders, other than what it calls “eligible contract participants”, SEC-speak for institutional traders.

PLY: The crackdown on the rather dubious end of the forex trading business is about to go into full swing in the USA I suspect…

 

In Repo Market That Ensnared Lehman, Risk of Fire Sale Lingers

Liz McCormick – Bloomberg

Fed pushing for fix to stamp out threat of dumping collateral; push for central clearinghouses yields little progress.

 

SGX Pushes Into Asian Bond Trading as IPOs Sink

David Yong – Bloomberg

SGX is seeking to capture a larger slice of secondary trading of foreign-currency bonds from Asian issuers to augment revenue as it endures a multi-year slump in IPOs.

Indexes

Third Annual FTSE Russell Survey Signals Smart Beta Turning Point For Asset Owners

LSE

Career Paths

Gathering at KDPW’s headquarters in Warsaw for their Ordinary General Meeting on Friday 20 May 2016, European Central Securities Depositories Association (ECSDA) members re-elected Mathias Papenfuß of Clearstream as Chairman of the association.

ECSDA Executive Committee, whose members are elected by the BoD: Chairman – Mr Mathias Papenfuß, Clearstream, Vice-Chairman – Ms Brigitte Daurelle, Euroclear, Vice-Chairman – Mr György Dudás, KELER Ltd, Treasurer – Mr Georg Zinner, OeKB CSD, Mr Ignacio, Álvarez, Iberclear, Mr Indars Ašcuks, LCD, Mr Eddie Astanin, NSD, Mr Mauro Dognini, Monte Titoli, Mr Niels Olsen, VP Securities, Mr Nikolaos Porfyris, ATHEXCSD, Mr Boris T. Šnuderl, KDD, Ms Iwona Sroka, KDPW, Ms Vesna Živkovic, SKDD.

 

The Emerging Markets Working Group (EMWG) of the World Federation of Exchanges (WFE), elected Egyptian Exchange (EGX) to be one of the Vice Chairmen of the EMWG, for a period of two years, starting May 24, 2016. Mr. Sunil Benimadhu, CEO of the Stock Exchange of Mauritius, and Dr. Shahira Abdel Shahid, Advisor to the Chairman of the Egyptian Exchange, were elected as the two new vice chairmen of the EMWG, which included 21 members as of May 2016, out of a total of 63 WFE members.

 

FOW reports that DB1-owned 360T hired David Holcombe in product development for cleared FX.

 

Iulian Stan was validated by the FSA as a BoD member of Sibex.

 

At its AGM in Leipzig, Germany, the General Assembly of Europex, elected Pieter Schuurs, President & COO of ICE Endex, as the new Chairman of the Association. In addition, Jean-François Conil-Lacoste, Chairman of the Management Board of EPEX SPOT, was elected to the Europex Board. He joins the other five Board members already in office: Egbert Laege (Powernext), Ireneusz  Łazor  (TGE),  Mikael Lundin (Nord Pool), Pedro J. Mejía Gómez (OMIE) and Pieter Schuurs (ICE  Endex).  The elections were a consequence of the departure of Massimo Ricci from GME earlier this year.

In addition, the memberships of the Istanbul Energy Exchange (EPİAŞ) and the Independent Bulgarian Energy Exchange (IBEX) have been reconfirmed by the Europex General Assembly after their provisional admission at the beginning of this year. Both are now full members of the Association.

 

Markit To Double Staff In Index Team (subscription)

Tim Cave – Financial News

Markit is planning to double the size of its team managing financial indices this year, as the data group looks to capitalise on moves by banks to outsource the administration of their in-house index products.

Financial Calendar

25-26.05 – Finance Malta Annual Conference

26.05 – Oslo Bors NOK 4.15 dividend payment

27.05 – Record date TMX $0.40 dividend

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

Share Notes

In connection with a monthly share savings plan for employees of subsidiaries, Oslo Børs VPS Holding has sold a total of 1939 shares. New holding is 15341 shares. Employees paid a share price of NOK 86,56 per share, but were allowed a discount of 20% on purchases up to NOK 625.

Other stories

ESMA Clarifies The Reporting Of Reference Data Under MAR From 3 July 2016

MondoVisione

 

 

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