September 21 2015

Burgenstock 2015 - 468x60Burgenstock 2015 - 468x60


elb2 PLY: A crunchy bulletin to start the week. Fintech funding for Ancoa as ICAP expands Duco backing while Plus 500 takeover is slowed by regulatory issues. Biggest deal news is that NSE is on the path (albeit a relatively slow one) to IPO as BSE looks in the same direction. Rule 48 changes accelerated by NYSE while Federal prosecutors swirling around spoofers may yet prove a huge headache for organised venues in US derivatives.

Lots happening. I am already en route to Geneva for SFOA Burgenstock, – where leading industry figures congregate such as NSE CEO Chitra Ramkrishna and CME CEO Phupinder Gill…just to name two panellists from my conference opening Crossfire alone! Looks like a great day and I wish Dan Day-Robinson, the SFOA board and Dan’s organising team a hugely successful conference as the renaissance of the Association begun under Otto Naegeli, continues apace…

Public Markets

Charles Li Involved In Controversial China Hiring While At J.P. Morgan (subscription)
Ned Levin – Wall Street Journal

HKEx Responds To Media Enquiries

HKEX’s Li Says He Followed Hiring Procedures At JPMorgan
Cathy Kit Ching Chan – Bloomberg

Charles Li helped children of Chinese officials, clients get jobs at U.S. bank…has also issued a personal statement.

PLY: An ongoing US justice examination reaches Charles Li’s offices, albeit without any clear proof it seems.


ICAP Invests Further In Duco – Series B Funding To Accelerate Growth. Strategic Investment Made Through Euclid Opportunities, ICAP’s Early Stage Fintech Funding Business

PLY: Terms not disclosed but it’s encouraging news for the dynamic Duco team.


Playtech Updates On Acquisitions Of Plus500 & Ava Trade

Playtech Says Regulatory Decisions On Plus500 Deal Take Longer Than Expected
Maria Nikolova – LeapRate

Playtech, which in June tabled a £460 million acquisition bid for retail CFD and Forex broker Plus500, admitted that the regulatory process for approving the deal is taking more time than expected.

PLY: “High profile nature” – what a delicious description. Read our Premium Plus500 Turmoil & Deal – Brief – Part 2 and Exchange Deals Brief. …Meanwhile I see that Jacob Ma-Weaver whose Cable Car Fund was elegantly voluble in the discussion of Plus 500 just reported excellent fund figures.


LCH.Clearnet Eyes 2016 Launch For Cross-Margining (subscription)
James Rundle & Tim Cave – Financial News

To coincide with the start of mandatory clearing of interest-rate derivatives in Europe.

PLY: So they can cross margin the business not taking place in Rita and NLX, presumably. (Who knows maybe things will have changed by next year…).


U.S. Looking At Chicago Trader As Probe Over Fake Orders Widens
Keri Geiger & Matthew Leising – Bloomberg

A grand jury is hearing testimony in Chicago about possible commodities-market manipulation and in particular about the actions of Igor Oystacher. This comes on top of a regulatory probe and concerns raised in the past year by two exchanges about Oystacher, the co-founder of proprietary trading firm 3Red.

PLY: Note this sentence: “Federal prosecutors … as the Justice Department broadens its effort to police the $30 trillion U.S. futures market.” As noted before, I fear there are exchanges who have rather left the tent door open to abuse over the years and a suitably eager American prosecutor could find a lot of leverage in their typical hyperbole to cause a shake-up which could be appreciably worse than the famous undercover agent escapades during the 1980’s when the Feds populated various pits.


NYSE Making A Big Change After Being Attacked For Its Handling Of Market Chaos
Matt Turner – Business Insider

Big Board will extend the length of time certain trading firms are able to see imbalances between buy and sell orders.

PLY: The “Rule 48” kerfuffle has been echoing around markets in recent times – it’s not as if “Rule 48” dates to the 1848 revolutions (that’s not the same as the foundation of the CBOT – but same year) but when you look at such archaic processes within NYSE, you realise the amount of updating new owners ICE are packing into the venerable marketplace after decades (centuries?) without much foresight troubling the management floor, it seems.

Brussels Set To Recognise 5 More Overseas Clearing Regimes (subscription)
Philip Stafford – Financial Times

Europe is set to recognise five more countries as having “equivalent” rules to oversee clearing houses as Brussels steps up efforts to smooth cross-border activity in derivatives: voting on applications by Switzerland, Mexico, Korea, Canada and South Africa.

ConvergEx To Close One Of Its Two ‘Dark Pools’

ConvergEx is closing Vortex (standard bids and offers), in order to focus on its Millennium pool, where all orders are executed at the mid-point of the best bid & offer available.


Better For LSE To Be A Good Judge Than A ‘Good Guy’ (subscription)
Kate Burgess – Financial Times

Public sanctions, not private tickings off, are the way to build Aim’s reputation and draw investors.

Euronext Partners With Shanghai SE On Market Data

NZX Gets Key Measure Right In NXT Market
Stephen Franks – NBR

CFTC Interpretation Regarding Consistency Between CFTC Regulations Applicable To DCOs & The Principles For Financial Market Infrastructures

CFTC Interpretative Guidance Regarding The Use Of A “Firm or Forced Trades” Process By DCOs

LSE Investigates ‘Fat Finger’ Trade
Tommy Stubbington – Wall Street Journal

Friday shares across the U.K.’s FTSE 100 took a sudden dive in early afternoon trade before quickly recovering, prompting speculation of a  “fat finger.”

Private Markets

Akhil Gupta In Talks To Buy 5% In ICEX From MMTC
Madhvi Sally – The Economic Times

Akhil Gupta, Vice Chairman at Bharti Enterprises, is in talks to buy 5% stake in Indian Commodity Exchange (ICEX) from state-owned trading giant MMTC, which  is looking to divest its 26 % stake in the exchange, which has not been operational for more than a year.

PLY: MMTC has no desire to infuse more funds to increase the net worth of the exchange to meet regulatory norms.


NSE Tells Shareholders It Has Submitted Restructuring Proposal To SEBI
Swaraj Singh Dhanjal & Ashish Rukhaiyar – Livemint

National SE (NSE)  informed shareholders that it has submitted a proposal to SEBI on restructuring its business to comply with listing norms for exchanges. At its AGM held in Mumbai on Friday, NSE officials also told investors that the process of listing the exchange has been initiated.

PLY: Big news which rippled through the Indian media all weekend. Not a rapid process but the infusion of proper capitalism into the epicentre of India’s dynamic marketplaces is taking a step forward – just coincidentally as NSE CEO Chitra Ramkrishna steps onto the Burgenstock Crossfire stage tomorrow morning in Geneva… Overall, this is great news, markets are made for profit, even if some of the Indian blob remains reluctant to endorse the concept in the wake of the Jalan Committee et al.


BSE Pushes For Green Light On Listing (subscription)
James Crabtree – Financial Times

Ashish Chauhan, CEO of Bombay SE (BSE) has urged regulators to allow Asia’s oldest bourse to push ahead with long-delayed flotation plans, while also calling for higher foreign investment limits in India’s domestic exchanges.


NSE Files Appeal In High Court Against Order On Fine
The Economic Times

National Stock Exchange (NSE) has filed an appeal in the Bombay High Court concerning the order slapping a Rs 50 lakh (USD 75 k) fine on the bourse in a Rs 100 crore defamation suit filed by it against Moneylife.


China Futures Exchange To Limit Some Clients After Violations
Fox Hu – Bloomberg

These Two Projects Are Racing To Bring Election Gambling Back For 2016
Joshua Brustein – Bloomberg

Two competing projects—Truthcoin and Augur—are now fighting to be the next Intrade by the time the 2016 election is in full swing. And if they work as promised, they will be much harder to shut down.

More about Augur here and here.

PLY: The history of Intrade may never be entirely written but having been a co founder, I was gone before the US strategy was created which ended with Federal sanction.

Mixed Response To ‘No’ To Single Clearing House
K Raghavendra Rao – The Hindu Business Line

The KV Kamath Committee observed that a single CC across bourses encompassing equities, debt and derivatives, would introduce significant risk.


Japan – Local Exchanges Fight To Remain Viable
Tadaaki Inoue & Yomiuri Shimbun – Japan News

PLY: The 2013 Tokyo – Osaka merger has concentrated transactions in Tokyo leaving Sapporo, Nagoya and Fukuoka to now consider new means to grow their businesses.


Regulators Should ‘Not Stand In The Way Of Innovation’
Diana Ngo – The Cointelegraph

Blockchain technology has the potential to “fundamentally change” our financial system by allowing disintermediation, reducing transaction costs and improving market access, according to ASIC.

Dividend News

SIX To Pay An Extraordinary Dividend

PLY: Redistribution of cash raised from the sale of shares in STOXX & Indexium j.v.s to Deutsche Börse. Sales proceeds of CHF 650 million from July 2015 likely to result in a total dividend of CHF 400 million (CHF 20.50 gross per share) in addition to the CHF 156 regular dividend paid March 2015.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX flat, 63 Moons (FTIL) up 1%


SunGard Offloads Ambit Core Banking Unit

Singapore’s Silverlake Axis is to acquire SunGard Ambit, the core banking unit of the US technology group, for $12 million.

The $12 million (S$16.7 million) price tag is some way off the S$120 million that SunGard shelled out in 2006 for the business when its Asia Pacific operations acquired the assets of Singapore’s System Access.

PLY: An epic loss as big old systems get shuffled to new owners after SunGard failed to really achieve critical mass in core banking systems.


Tokyo SE: New Arrowhead Ready For Production Operations

BSE Eyes 10 Times Faster Trading Speed In Next Few Months
The Economic Times

In late 2013, BSE had upgraded its technology platform to BOLT PLUS, which is based on the global giant DB1’s trading architecture.

PLY: BSE transaction speed increases have already been dizzying for some time since they installed DB1 systems.


Oslo Børs To Launch TeamEngine Board Portal

Oslo Børs has entered into an agreement with the Swedish software company TeamEngine Group AB to sell its board portal solution in the Norwegian market.


Symphony CEO: It’s Not A Bloomberg Killer — It’s An Email Killer
Oscar Williams-Grut – Business Insider

Symphony, the secure messaging app backed by some of Wall Street’s biggest names, launched last week to much fanfare, with events in New York, London, Singapore, and Hong Kong.


Ancoa Successfully Closes Series A Funding Round – Raises Over £4m To Fund Continued Growth

Investors include Buysse & Partners, LRM Capital, SmartFin Capital, Velocity Capital and Ancoa’s management team as well as a number of high net worth individuals and family offices.

PLY: Great news, well done Karl and team.


Kara Stein Urges SEC To Act Over Cyber Attacks (subscription)
Barney Jopson – Financial Times

SEC needs to be “much more active” in pushing businesses to boost their cyber defences in the face of growing threats.


The New Bond Market: Bigger, Riskier And More Fragile Than Ever (subscription)
Colin Barr – Wall Street Journal

Gigantic debt-trading arena is subject as never before to price reversals and disruptions.


Palestine Exchange In The FTSE Frontier Markets Index

Career Paths

Bloomberg reports that Optiver hired former Goldman Sachs partner Jan Boomaars as European CEO to start on Oct. 1. The role was previously handled by global CEO Paul Hilgers, who took over from Edwin van der Kruk.

HK SFC appointed Ms. Maureen Garrett, Deputy Chief Counsel, as Interim Head of Enforcement.


ESMA Updates Organigramme To Support Its 2016-20 Strategic Orientation

Financial Calendar

This week

22.09 – LSEG 10.8 pence interim dividend payment

22.09 – CFTC Agricultural Advisory Committee

23.09 – SEC Advisory Committee on Small and Emerging Companies – agenda here.

25.09 – Nasdaq $0.25 quarterly dividend payment

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


P2P Lender Ratesetter Doubles Sales As It Targets Listing (subscription)
James Titcomb – Daily Telegraph

Other stories

China To Continue Crackdowns On Illegal Share Sales And Speculative Trading

RSRCHXchange Launches Online Marketplace For Institutional Research

PLY: Interesting tidbit to end a fascinating day – see you in Geneva for SFOA Burgenstock!

This site is protected by Comment SPAM Wiper.