The next AMIC Conference will take place in Paris, on 11 March, in partnership with AF2I and will be hosted by BNP Paribas Asset Management. The conference will feature panels and keynotes on fund liquidity and leverage, challenges and opportunities in the current investment environment, sustainable finance and asset allocation. The event is free to attend for all but registration in advance is essential.
The next AMIC Executive Committee meeting will also take place in Paris on 11 March.
ICMA Asset Management and Investors Council (AMIC) Regulatory Update
7 February 2020 ESMA publishes the final report on MiFIR alignments following the introduction of EMIR Refit
The European Securities and Markets Authority (ESMA) has published a final report suggesting amendments to the trading obligation under MiFIR following the introduction of EMIR Refit.
12 February 2020 CSSF issues press release on Monitoring the quality of transaction reports received under Article 26 of MiFIR
The Luxembourg Commission for Financial Sector Surveillance (CSSF) has issued a press release on 12 February 2020.
The press release covers:
- Main observations and recommendations issued in 2018 and 2019;
- Prospects for the 2020 campaign; and
- Monitoring to be ensured
6 February 2020 Speech by Mark Steward (FCA) on Market integrity and strategic approach
Speech by Mark Steward, Executive Director of Enforcement and Market Oversight at the Financial Market Authority (FCA), on Market integrity and strategic approach:
- They work with a very high degree of precision and collaboration with both US regulators and EU authorities on issues that affect their markets. They need to avoid fragmentation in their markets which wrongdoers with arbitrage opportunities for misconduct.
- The market cleaniness metric was first published in 2008 when it found that approximately 30% of takeovers showed abnormal price movements 2 days prior to an announcement. Their latest figure published in 2019 is currently at its lowest score at around 10% and they have developed a new measure which has produced a lower figure of 6.4%.
- They have taken a strategic and integrated approach to their market integrity efforts encompassing enforcement, primary and secondary oversight and surveillance, and wholesale supervision which could explain improvements recorded by the market cleaniness metric and abnormal trading volume ratio.
- Would-be abusers should be aware of their increased detective power which materially ratchets up the risk of abusers being found out.
11 February 2020 Speech by John Cunliffe (BoE) Governance of financial globalisation
Speech by John Cunliffe, Deputy Governor, Financial Stability at the Bank of England (BoE) about governance of financial globalisation.
Jon Cunliffe sets out the progress we have made and the challenges we face around the governance of financial globalisation. He acknowledges that governance is important because the Bank of England is responsible for the largest and most complex financial centre in the world.
He says the UK needs to work closely with the EU to meet challenges such as changes to cross-border payment systems. This will help develop future governance of the deep financial links that exist between us.
11 February 2020 EIOPA sets out strategies an cyber underwriting and SupTech
The European Insurance and Occupational Pensions Authority (EIOPA) has published its strategies for cyber underwriting and supervisory technology, or SupTech.
The strategies reflect strategic priorities and respond to the evolving insurance landscape, in particular related to digital technology.
These elements also feature in EIOPA's supervisory convergence plan for 2020, published on 12 February.
11 February 2020 ESRB's Advisory Scientific Committee (ASC) publishes a report on the risk channels
The European Systemic Risk Board (ESRB) has published a on the risk channels associated with international financial integration for EU economies. It also provides an overview of the macroprudential policy options that are available to address these risks. The ASC observes that due to their cross-border activities, global banks play an important role as generators, transmitters and receivers of global systemic risk.
Moreover, non-bank financial institutions’ activities and interconnections have also started to influence the dynamics of the global financial cycle, hence the report calls for closer monitoring of their activities. From the perspective of a domestic economy, existing empirical evidence points to the effectiveness of macroprudential measures (eg capital buffers) in boosting resilience to dampen the transmission of the global financial cycle; and increased international cooperation in the field of macroprudential policy would address possible spillovers of these measures.
12 February 2020 IOSCO publishes key considerations for regulating crypto-asset trading platforms
The Board of the International Organisation of Securities Commissions (IOSCO) has published a report that describes the issues and risks associated with crypto-asset trading platforms (CTPs) and sets out key considerations to assist regulatory authorities in addressing these issues.
The key considerations relate to:
- Access to CTPs;
- Safekeeping of participants assets, including custody arrangements;
- Identification and management of conflicts of interest;
- Transparency of operations;
- Market integrity, including the rules governing trading on the CTP, and how those rules are monitored and enforced;
- Price discovery mechanisms; and
- Technology, including resiliency and cyber security
12 February 2020 European Parliament urges ECB to redesign CSPP to support sustainability objectives
The European Parliament urged the European Central Bank (ECB) to step up its green credentials and address growing financial technology challenges. The Parliament calls on the ECB to better integrate environmental, social and governance (ESG) principles into its policies and redesign its corporate sector purchase programme (CSPP) to better support environmentally sustainable initiatives. The European Parliament deplored that green bond issuance still accounts for only 1 % of the overall supply of euro-denominated bonds, while a majority (62.1 %) of ECB corporate bond purchases remain in sectors that are responsible for 58.5 % of euro area greenhouse gas emissions.
12 February 2020 Speech by Steven Maijoor (ESMA) on sustainable finance issues
Speech by Steven Maijoor, Chair of the European Securities and Markets Authority (ESMA), has delivered a keynote address on sustainable finance issues at the European Financial Forum in Dublin.
In his speech, Mr Maijoor focused on, amongst other issues, regulatory authorities role in tackling climate change, the need for reliable ESG standards and their supervision and the need for measures across the whole of the investment chain.
Upcoming ICMA Courses
Collateral Management London, 30-31 March
Inflation-Linked Bonds and Derivatives London, 2-3 April
Fixed Income Certificate (FIC) Amsterdam, 18-22 May
Fixed Income Portfolio Management & Construction London, 27-29 May
Financial Markets Foundation Qualification (FMFQ) London, 3-5 June
Securitisation: An Introduction London, 16-17 September