New members in 2020
32 firms have joined ICMA so far this year from 19 countries, bringing the total membership
to date to 595 institutions in 62 countries.
ICMA has submitted a letter
to the European Commission and ESMA outlining the industry concerns related to timely implementation of the CSDR mandatory buy-in provisions. The letter highlights the ongoing lack of regulatory clarification required by the industry to facilitate successful implementation, as well as asking the authorities to review the design and application of the buy-in framework in light of recent market events.
A briefing note
outlining the identified deficiencies in the CSDR provisions for cash compensation in the case of bond markets, as well highlighting some of the potential market solutions under discussion, including the significant challenges associated with these, was produced in conjunction with the ICMA’s dedicated CSDR Cash Compensation Workstream, part of ICMA’s CSDR-SD Working Group
Consolidated tape for bond markets
ICMA has published a report
into considerations surrounding the establishment of an EU consolidated tape (CT) for bond markets. This report was produced in response to a request from the European Commission’s DG-FISMA for a bespoke study assessing the feasibility of implementing a consolidated tape for EU post-trade raw bond data.
Bond Market Post-Trade Transparency Directory
A new overview
of current post-trading reporting obligations across multiple jurisdictions from Europe, the Americas and Asia-Pacific, provides a consolidated view to compare both regulatory rules and best practice guidance on bond post-trade transparency regimes, as well as details on reporting fields and exceptions.
Repo and collateral markets
ESMA confirms ICMA proposals for reporting of central bank repos under MiFIR
In response to an ICMA query, ESMA has provided some long-awaited clarification
on the reporting of repos transacted with EU central banks. Under SFTR, SFTs transacted with one of the 27 EU central banks that are part of the European System of Central Banks (ESCB) are exempted from the reporting obligation. However, these trades have in turn been included in the scope of MiFIR transaction reporting.
Updated version of SFTR recommendations
On 22 April, ICMA’s European Repo and Collateral Council (ERCC) published an updated version of the ICMA Recommendations for Reporting under SFTR
. The ICMA guide was initially published on 24 February and aims to help members interpret the regulatory reporting framework specified by ESMA and sets out complementary best practice recommendations to provide additional clarity and address ambiguities in the official guidance. As compared to the initial publication, the later version relevant updates, including to reflect the recently granted 3-month delay to the first phase of the SFTR go-live as well as the forbearance on backloading.
ICMA repo survey and report on market conditions during the COVID-19 pandemic
The 38th ICMA survey
measured outstandings in the European repo market on 11 December 2019 based on the returns of 58 financial institutions, recording the baseline figure for the size of the repo market as a record EUR 8,310.3 billion, compared with the total for June 2019, which was EUR 7,761.4 billion, an increase of 7.1% and a year on year rise of 5.9% .
The COVID-19 market report
revealed that while the market performed relatively well, demand for repo increased significantly during the height of the crisis in February/March and dealers’ capacity to intermediate that demand was relatively constrained, limiting access to many firms that needed it.
2020 legal opinions on Global Master Repo Agreement
The 2020 ICMA GMRA legal opinions
which support the Global Master Repurchase Agreement (GMRA), the standard agreement for international repo transactions, including a new opinion for Argentina were published on 16 April.
ERCC webinars on key repo and collateral market topics
include presentations on the two important regulatory initiatives that are set to reshape the market, the EU SFT Regulation and CSDR mandatory buy-ins; a legal update highlighting developments in relation to repo documentation and the ICMA GMRA legal opinions; the results of the latest European repo survey; and a discussion on ICMA’s ongoing collaboration with ISDA to extend the Common Domain Model (CDM) to SFTs, building a standardised digital representation of repos.
High-level definitions for sustainable finance
ICMA is proposing high-level definitions
, building on current market usage and existing official sector terminology, for the most commonly used terms in the sustainable finance field, for example climate finance, impact finance, green finance and social finance. The objective is to ensure that all participants and stakeholders are using a common and transparent vocabulary. Listen to Nicholas Pfaff, Managing Director and Head of ICMA Sustainable Finance with colleagues Simone Utermarck, Director and Ozgur Altun, Associate, discussing the high-level definitions paper
The EU’s sustainability disclosure regime
New and amended EU legislation is introducing significant sustainability and ESG related disclosure requirements that will impact all participants in the European capital markets. This is arguably leading to what we are referring to as an “EU sustainability disclosure regime”. Our publication
seeks to provide the market with an initial comprehensive and practical overview of these developments.
Listen to the podcast on how the new EU sustainability disclosure obligations will impact large firms and asset managers.
to the European Commission's MiFID II/R review consultation paper on Primary markets, secondary markets and fintech in relation to bond markets
to the EC consultation on the EU Ecolabel for financial products. While AMIC supports the idea of an EU quality stamp for ESG retail investments funds it also warns that some important changes are required to ensure the success of this new label. AMIC recommends in particular broadening the list of eligible assets for diversification purposes but also to further support companies transitioning to a lower-carbon business model.