Most Clicked SIFMA Global SmartBrief Stories
1. Policymakers in Europe, US contemplate derivatives rules
SIFMA Global SmartBrief | Mar 12, 2010
In Europe and the US, policymakers, regulators, industry insiders and observers are debating issues related to derivatives, particularly credit default swaps, as well as hedge funds and private-equity firms. France and Germany have called on the EU to consider banning naked credit default swaps and toughen up regulation of derivatives. EU finance ministers are poised to consider the proposals next week. Meanwhile, some on Wall Street are striving to be heard, acknowledging that changes are likely. Others are voicing concerns about arbitrage. "Everyone is concerned about the fact that there are global markets, but legislation is done on a national basis," said Cory Strupp, managing director of government affairs for SIFMA. New York Times (free registration), The (11 Mar.) Financial Times (tiered subscription model) (11 Mar.) Wall Street Journal, The (11 Mar.) CNBC (12 Mar.) Financial Times (tiered subscription model) (12 Mar.)
2. UK's Brown forces EU to shelve directive on hedge funds
SIFMA Global SmartBrief | Mar 17, 2010
The EU was trying to push into law its controversial Directive on Alternative Investment Fund Managers, but UK Prime Minister Gordon Brown said the regulations are unacceptable. Spain deleted the item before the start of the Economic and Financial Affairs Council meeting. Spanish Finance Minister Elena Salgado said she is seeking "as much consensus on this as possible, and we think there is more room to manoeuvre so we can get it". "It is a major priority of ours to get a deal on hedge funds through during our presidency, so we still have a few weeks ahead of us to get this done," Salgado said. Wall Street Journal, The (17 Mar.) Independent (London), The (17 Mar.) Financial Times (tiered subscription model) (17 Mar.)
3. Experts warn of another crisis as policymakers differ on global reforms
SIFMA Global SmartBrief | Mar 16, 2010
Policymakers in Europe, Asia and the US are grappling with ways to overhaul the financial system, but experts warned that anything short of a global consensus could be problematic. Traders, bankers and other industry participants likely would shift their businesses to jurisdictions with the loosest rules. "You're dealing with different accounting standards, different political systems and different banking systems," said Kenneth Rogoff, former chief economist at the International Monetary Fund. "It will be very hard to create one-size-fits-all regulations." Google (16 Mar.)
4. Europe, US struggle with global approach to financial regulation
SIFMA Global SmartBrief | Mar 15, 2010
Regulators, policymakers and other industry insiders agree that a global approach to an overhaul of financial regulation is necessary, but they are struggling to come to a consensus on the details. Europe and the US, in particular, are feuding over regulation of hedge funds, derivatives and bankers' compensation. The failure to agree shows how difficult it is to effectively regulate the financial industry on a global basis. Even within the EU, officials are struggling to reach an agreement on a unified approach. Washington Post, The (13 Mar.)
5. Analysis: Italy has a derivatives time bomb about to blow
SIFMA Global SmartBrief | Mar 12, 2010
Financial markets, regulators and industry insiders have focused on Greece's debt woes and the role derivatives played in the crisis. Italy, however, also has a derivatives debacle on its hands that stretches across hundreds of cities, according to Reuters. Local governments were keen to reduce their financing costs and did so through complex derivatives contracts. Reuters notes that when interest rates increase, many cities will face substantial losses, prompting them to work to get out of the deals. Reuters (11 Mar.)
6. Barclays blocks details in examiner's report on Lehman
SIFMA Global SmartBrief | Mar 15, 2010
Times (London), The (15 Mar.)
7. Officials voice concerns about different reform approaches
SIFMA Global SmartBrief | Mar 18, 2010
Leading regulatory officials and policymakers in Europe and elsewhere are voicing concerns about different approaches to regulation of financial instruments and markets. "We all sit in the same boat," said Financial Stability Board Chairman Mario Draghi. "... We want to retain a globally integrated financial market. That is a prerequisite for stability and growth." Meanwhile, Michel Barnier, financial-services chief for the EU, said he will propose a crackdown on debt speculators, despite comments from other regulators that such a move would not work. iMarketNews.com (17 Mar.) Reuters (17 Mar.) Telegraph (London) (17 Mar.)
8. FSA document provides data on suitability of structured products
SIFMA Global SmartBrief | Mar 17, 2010
Britain's Financial Services Authority published a document answering frequently asked questions about a template for the suitability of structured products. "It seems the Q&As are consistent with the expectation we heard recently," said a banker in structured products. "On the very important point of limits and diversification, the FSA has given significant latitude for individual firms to exceed them based on best customer outcome." Risk.net (16 Mar.)
9. BoE considers moves to provide liquidity insurance to banks
SIFMA Global SmartBrief | Mar 18, 2010
The Bank of England is looking into improving its ability to provide healthy banks with short-term liquidity insurance by expanding the types of collateral that are eligible in its discount-window facility. The central bank also plans to gather more information on covered bonds and asset-backed securities for use in the discount window and other operations. AFME voiced support for the central bank's efforts. "AFME supports the principle of improving transparency for asset-backed securities and covered bonds, and we welcome the bank's initiative," a spokesman for AFME said. iMarketNews.com (17 Mar.) Wall Street Journal, The (17 Mar.)
10. RBS plans balance-sheet restructuring to bolster capital
SIFMA Global SmartBrief | Mar 16, 2010
Royal Bank of Scotland is aiming to improve its standing with bond investors and bolster its capital strength by undertaking a restructuring of its balance sheet. The bank's efforts could include buying back at least £10 billion in debt, echoing steps taken by other financial institutions. Financial Times (tiered subscription model) (15 Mar.)
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Companies in the news
- Allied Capital Corp
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- Apax Partners
- BB&T Corporation
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- CIT Group
- GTCR Golder Rauner LLC
- General Electric Company
- Greenhill & Co.
- Huntington Bancshares
- Intesa
- KRG Capital Partners
- RBC
- Renaissance Technologies LLC
- UBS