| December 14, 2021 | "Irreverent, but never irrelevant" | | | | John Lothian
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John Lothian News | |
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FIA: Global Exchange-Traded Volume up 38.8% in November; Open Interest Posts Record
By Suzanne Cosgrove - John Lothian News
The continued investor appetite for equity derivatives helped push global exchange-traded volume higher again in November, according to the FIA's monthly report released on Monday. The group said 6.17 billion futures and options contracts were traded in the month of November, an increase of 11.5% from October and up 38.8% from November 2020.
On a year-to-date basis, volume for the first 11 months of 2021 totaled 56.44 billion contracts, up 33.8% from the total posted in the first 11 months of 2020. For the month of November, futures volume grew by 12.6% from the same period last year, with 2.71 billion contracts changing hands, and options volume was up a steep 69.8% with 3.45 billion contracts traded.
To read the rest of this story, go here.
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Hits & Takes
John Lothian & JLN Staff
ISDA has published a paper titled "Contractual Standards for Digital Asset Derivatives." Phil Stafford of the Financial Times has a story about the paper titled "Isda proposes market rules to cover crypto 'disruptions'; Standards setter for global derivatives industry reflects 'unique' quirks of crypto."
ISDA also has a post titled "IIFM and ISDA Publish IBOR Fallback Bilateral Amendment Agreement and Definitions Booklet," and "ISDA-Clarus RFR Adoption Indicator: November 2021." ISDA says "the indicator tracks how much global trading activity (as measured by DV01) is conducted in cleared over-the-counter and exchange-traded interest rate derivatives (IRD) that reference the identified risk-free rates (RFRs) in six major currencies. On a traded notional basis, the percentage of RFR-linked IRD comprised 17.7% of total IRD in November compared to 17.0% the prior month."
The International Financial Center Japan website is up and running. The idea behind it is "transforming Japan into an international financial center that attracts employees, companies, and funds from around the world."
Clare Black is the director of corporate affairs and communications at Innovate Finance and she is looking for someone to replace her in this U.K.-based position. Clare says her replacement will be "working within one of the UK's fast-growing sectors, spreading the word far and wide about how FinTech and innovation in financial services are a key part of our future."
Nodal Exchange hit another record with its open interest in environmental markets topping 175,450 contracts for the first time, which is up 100% from 87,846 contracts in January -- LinkedIn
Today we have an interview with Michael Chin, the CEO of Broadway, formerly Broadway Technology. I interviewed Michael before Thanksgiving about Broadway's long and winding road to independence after it was bought by Ion Group and then mostly spun back out. Broadway 2.0 is what the firm is calling its new life as an independent company backed by private equity.
The men's college basketball team at my alma mater, Purdue, fell to third place in the AP poll for the top-ranked basketball teams after spending a week at No.1 for the first time in its history. Baylor is now the No.1-ranked team. -- Hammerandrails.com
Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL
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ISDA is planning a virtual FX Products and Documentation conference on January 25 from 9 a.m. to 11:30 a.m. ET, which is designed to provide an overview of the plain-vanilla foreign exchange products, as well as certain more "exotic" products like variance swaps and volatility swaps. Importantly, the conference will also provide an overview of standard terms and documentation templates relevant to bilateral execution of transactions. Educational credit hours are available. Registration information is here.~SC
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Broadway 2.0's Long and Winding Road to Independence
JohnLothianNews.com
Michael Chin is the CEO of Broadway Technology, which recently went through a rebrand and is now just Broadway. The path to Broadway 2.0, as Chin called it, was an unusual one. Chin was interviewed recently by John Lothian News about its journey from acquisition to independence.
Broadway Technology has been working on a renewal since it was spun out of ION Trading after the U.K.'s Competitive Markets Authority told ION it had to spin back out most of Broadway because of overlap in both firms' fixed income offerings.
Watch the video »
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Bored Ape NFT Sells for $3,000 Instead of $300,000 After Fat-Finger Error
Denitsa Tsekova - Bloomberg
A fat-finger error led an online trader to sell his non-fungible token for one hundredth of its $300,000 actual price, according to CNET. A trader named Max, with the user name maxnaut, listed his NFT -- part of a limited The Bored Ape Yacht Club collection of 10,000 pieces -- for 0.75 ether (approximately $3,000), instead of 75 ether, CNET reported. It was automatically snapped up before he could correct the mistake.
/bloom.bg/30qhdvL
**** To me, the more interesting part of this story is that the buyer spent $38,000 to make the transaction almost immediate so the seller could not stop/reverse the transaction. Also, all done by a bot, happened in an instant. ~JB
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The Hare with Amber Eyes at the Jewish Museum — ghosts of a lost world; Edmund de Waal's carved netsuke bring the words of his memoir hauntingly to life
Ariella Budick - FT
In his 2010 memoir The Hare with Amber Eyes, Edmund de Waal tracks the wanderings of his family's collection of 264 netsuke from their birthplace in Japan to the mansions of Paris and Vienna, back to Tokyo and finally to his south London home. Along the way, these delicate, sometimes grotesque sculptures evolved into literary figures. Deracinated and dematerialised, they became the animating spirits of his tale rather than just physical objects. Now, here they are in the flesh — or rather in ivory, boxwood, buffalo horn and boar's tusk — at the Jewish Museum in New York, but it's de Waal's spare, poetic writing that hovers in the air.
/on.ft.com/31USBM5
***** The book "The Hare with Amber Eyes" is an important one, telling the story of a banking family, art, war, loss and a collection of netsuke. I recommend the book fully, and this exhibit sounds incredible.~JJL
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This $69 little black dress is made out of carbon emissions collected from steel mills
Rachel Koning Beals - MarketWatch
Could this party dress be a solution for pollution? Inditex's Zara brand launched a limited line of little black dresses made partly from carbon emissions on Monday. And while it's just one little test for an industry known to spew a lot of emissions into the air as it swaps out retail trends at increasing speed, via so-called fast fashion, the technology represents a rethinking of consumerism. Beyond the supply chain footprint, a makeover for materials is part of what some say will be necessary to stop Earth from heating up too fast and landfills from overflowing.
/on.mktw.net/3yojSCN
*****Rachel Koning Beals is a former contributor to Environmental Markets Newsletter, the second newsletter JLN ever launched. Good to see her still writing about environmental stories, even if it is about a LBD.~JJL
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Monday's Top Three
Our most-read story Monday was Bloomberg's Zero Taxes, Golf and Beach Houses Create a Crypto Island Paradise, about Puerto Rico. Second was HSBC and Wells Fargo to settle currency trades with blockchain, from The Financial Times. Third was "John's Take - A bittersweet farewell to John J. Lothian & Co.'s office on LaSalle Street," John Lothian's segment in The Spread, on Vimeo.
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MarketsWiki Stats
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MarketsWiki Statistics
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| Lead Stories | Why do Covid boosters offer greater protection against Omicron? Studies show three jabs are more effective than two as manufacturers work on variant-specific vaccines
Hannah Kuchler, Donato Paolo Mancini and Oliver Barnes - FT
In the race to protect their populations against the Omicron coronavirus variant, countries including the UK and US, are rolling out extensive booster programmes after data showed additional jabs provided more protection against the new strain than two shots.
/on.ft.com/3oSKvMX
Omicron Is a Dress Rehearsal for the Next Pandemic; America's response to the variant highlights both how much progress we have made over the past two years — and how much work remains
Emily Anthes - NY Times
vered the highly mutated Omicron variant of the coronavirus last month, it set off an eerily familiar chain of events. Health experts held somber news conferences that raised more questions than answers. Officials imposed travel bans that very likely came too late. Virus trackers filled in their maps as the variant was reported in country after country. And the rest of us waited, with increasing unease, to learn more about the threat we were facing.
/nyti.ms/320wvYy
Bank of England Says Crypto's Rapid Growth Could Pose Stability Risks
Yueqi Yang - Bloomberg
The Bank of England reiterated its warning that the rapid growth of cryptocurrency assets could pose stability risks to the U.K. financial system, even though the current direct risks are "limited." The central bank's Financial Policy Committee said crypto assets are becoming more interconnected with the wider financial system, and enhanced regulatory and law enforcement frameworks are needed to manage risks, according to its December Financial Stability Report. Financial institutions should take a "cautious and prudent approach" to any adoption of crypto assets until a regulatory regime is in place, it said.
/yhoo.it/3pQJTHa
Wall Street Is Close to Triggering a Climate Financial Crisis; And just like 2008, the biggest losers will be those least responsible for it.
Tim Quinson - Bloomberg
If the financial-services industry was a country, it would rank as the world's fifth-largest emitter of greenhouse gasses. A study authored by the Sierra Club and the Center for American Progress shows that eight of the biggest U.S. banks and 10 of its largest asset managers combined to finance an estimated 2 billion tons of carbon dioxide emissions, based on year-end disclosures from 2020, or about 1% less than what Russia produced.
/bloom.bg/3DQjyxH
Red flags raised at third of electronic money institutions, researchers warn; Fast-growing industry could become 'major gateway' for illicit funds, says Transparency International UK
Cynthia O'Murchu - FT
Money laundering red flags have been indicated at more than a third of UK-licensed electronic money institutions, according to researchers who are calling for tougher oversight of the fast-growing sector. Transparency International UK warned in a report that the payments industry could become a "major gateway" for illicit funds from around the world unless the industry is subject to stricter enforcement.
/on.ft.com/323TDFq
Isda proposes market rules to cover crypto 'disruptions'; Standards setter for global derivatives industry reflects 'unique' quirks of crypto
Philip Stafford - FT
Disruptions unique to cryptocurrency markets will be incorporated into contracts for the global derivatives industry for the first time, in a move intended to broaden digital assets' appeal to institutional investors. Isda, the derivatives trade association, said on Tuesday it was developing common legal standards and templates for derivatives linked to the $3tn crypto market to cover "potential disruption events".
/on.ft.com/3dRts7S
Morgan Stanley boss says he was wrong to order staff back to the office
Will Feuer - NY Post
Morgan Stanley CEO James Gorman on Monday admitted he "was wrong" about previously pushing staffers to return to the office while threatening to cut their pay if they didn't. "I thought we would have been out of it past Labor Day and we're not," Gorman told CNBC, referring to the COVID-19 pandemic.
/bit.ly/3F1HRdG
New Products Will Let Europe Traders Bet On or Against ARK Funds
Sam Potter - Bloomberg
Leverage Shares launches range of ETPs tracking thematic ETFs; Products include leveraged, inverse and unleveraged strategies
Investors in Europe are getting access to three of the main strategies from ARK Investment Management LLC for the first time, as Leverage Shares releases a range of products allowing bets both on and against the main funds of superstar money manager Cathie Wood.
/bloom.bg/3oQxDai
When Two Nations Are Divided by a Common Pandemic; Whether it's a plot, bungling or something else, the U.K. and U.S. are reacting to omicron very differently. There are hints for central bank policy.
John Authers - Bloomberg
Here in Britain, whenever something bad happens there is a natural tendency to divide the possible explanations into two buckets: cock-up or conspiracy. The phrase "cock-up" is not as lewd as you might think; I've found numerous putative derivations and it appears to come from a printing difficulty. But in practice, what it means is that the problem was caused by somebody making a stupid mistake. A conspiracy is self-explanatory, and much more sinister.
US justice department probe adds to rotten year for short-sellers; In an environment of ultra-cheap money, hedge funds find it dangerous to target overvalued companies
Laurence Fletcher - FT
Short-sellers have endured a rotten 2021 and to cap it all, they now face an investigation by the US Department of Justice. Despite an important role in financial markets, the tactics of some funds will once again be under scrutiny. The criminal investigation will look at research reports issued by short-sellers and whether they have used their relationships to depress stock prices, according to reports of the probe. The DoJ did not immediately respond to a request for comment.
/on.ft.com/3dP7y4X
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| Wellness Exchange | | An Exchange of Health and Wellness Information | Fidelity, Morgan Stanley prepare for continued COVID-19 concerns
Ross Kerber, Elizabeth Dilts Marshall and Matt Scuffham - Reuters
Asset management firm Fidelity Investments on Monday said it had paused some voluntary return-to-office plans while Morgan Stanley's CEO said he expects COVID-19 to be an issue through the next year, in a further sign that America's financial industry is rethinking its return to "business as usual."
/yhoo.it/3IFcXK6
Hong Kong Lays Out Rules for Quarantine-Free Travel to China
K. Oanh Ha - Bloomberg
Hong Kong's financial regulator unveiled rules for quarantine-free business travel to the Chinese mainland, laying out some of the first details in the long-awaited plan to re-open the border.
/yhoo.it/3DRB5FN
Pfizer Stops 70% Omicron Hospitalizations in South Africa Study
Janice Kew and Antony Sguazzin - Bloomberg
Pfizer Inc. and BioNTech's Covid-19 vaccine, as well as the shot developed by Johnson & Johnson, appear to prevent severe disease from the omicron variant, South African studies show. The two-shot Pfizer course may offer 70% protection against being hospitalized with the variant that is driving the country's fourth wave of infections, Discovery Health Ltd., the country's largest medical-insurance provider, said on Tuesday.
/yhoo.it/3yobPWB
U.K.'s 'Warp Speed' Booster Rollout Is Already Struggling
Stuart Biggs and Joe Mayes - Bloomberg
Growing warnings over end-December target to reach all adults; Government faces major Tory rebellion over new Covid-19 rules
Boris Johnson's strategy for tackling a U.K. surge in omicron infections is already facing setbacks, as medics warn of bottlenecks and staffing shortages in the vaccine booster program.
/bloom.bg/3yp1HNi
Pfizer Covid Pill Stops Hospitalization, Not Milder Symptoms
Robert Langreth - Bloomberg
Mixed results found in big study of pill in vaccinated people; Separate trial confirms strong efficacy in the unvaccinated
New study data showed Pfizer Inc.'s experimental Covid-19 pill was highly effective at keeping patients out of the hospital, but less adept at erasing milder symptoms often associated with breakthrough infections.
/bloom.bg/3yxxyvq
Singapore Warns of 'Omicron Wave' as Workplace Rules Eased
Faris Mokhtar and Low De Wei - Bloomberg
Up to 50% of those vaccinated can return to office from Jan. 1; Wong says current lull in cases may be calm before next storm
Singapore will loosen some workplace rules as the city-state sees Covid-19 infections easing off their peak, even while it braces for a potential "omicron wave." Up to 50% of fully-vaccinated individuals who can work from home will be allowed to return to the office from Jan. 1, the Ministry of Health said in a statement Tuesday, although social gatherings at the workplace still aren't allowed.
/bloom.bg/3DTkod8
Omicron Severity Seen Masked by Prior 72% Case Rate in South Africa
Antony Sguazzin - Bloomberg
Survey shows 72% of Gauteng population previously infected; Hospitalization rates have been muted in South Africa
Leading scientists cautioned that the level of immunity against the coronavirus among South Africa's population due to earlier infections may be masking the severity of illness caused by the omicron variant.
/bloom.bg/3EVs9k6
England set to drop all 11 countries from coronavirus travel red list; Move signals acceptance by UK government that Omicron variant can no longer be contained
Sebastian Payne - FT
Ministers will imminently sign off on a decision on Tuesday to remove all 11 countries from England's coronavirus travel "red list" of travel restrictions, signalling that the UK government accepts the Omicron variant can no longer be contained.
/on.ft.com/3DTcOzd
Pfizer says Covid drug offers strong protection and should work against Omicron; Data confirm Paxlovid cuts risk of hospitalisation or death by 89% for highly vulnerable patients
Hannah Kuchler - FT
Pfizer's Covid-19 antiviral pill cuts the risk of hospitalisation or death by up to 89 per cent in high-risk patients, according to final trial results that confirm earlier data. The positive results come after a rival antiviral from Merck proved less effective than initially hoped and at a time when the new Omicron variant surges in several countries.
/on.ft.com/3oVclbi
UK Omicron infections running at 200,000 a day, says health agency; Variant's rapid spread adds urgency to push for England-wide vaccine boosters
Oliver Barnes, George Parker, Laura Hughes, Jasmine Cameron-Chileshe and Sarah Neville - FT
New Omicron infections in the UK are running at 200,000 a day, dwarfing the number of officially confirmed cases, according to an estimate from the UK Health Security Agency.
/on.ft.com/3EUHCRz
Denmark and Norway Predict Drastic Spike in Omicron Cases Health authorities in Europe are warning of a sharp increase in Omicron cases, adding to an existing surge from the Delta variant.
Carl Zimmer and Emily Anthes - NY Times
Public health authorities in Denmark and Norway on Monday released grim projections for the coming wave of the Omicron coronavirus variant, predicting that it will dominate both countries in a matter of days. Although scientists don't yet know how often the variant causes severe disease, they say its rapid rate of spread will lead to an explosion of cases and could potentially increase pressure on hospitals, even if it proves to be mild.
/nyti.ms/3ynwhqs
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| Exchanges, OTC & Clearing | | Top news from exchanges, clearing, settlement and trade execution facilities | Norwegian Block Exchange lists on Euronext Growth Oslo
Euronext
Market capitalisation of approximately NOK 584 million; 197th listing on Euronext markets and 65th on Oslo Børs markets in 2021
Oslo Børs, part of the Euronext Group, today congratulates Norwegian Block Exchange on its listing on Euronext Growth Oslo (ticker: NBX). The company started as a spin-off from Norwegian Air Shuttle (NAS) to introduce cryptocurrency payments to the air industry with the incentive to reduce costs related to payments. It was founded by Bjørn Kjos, who also founded NAS and Bank Norwegian. Today, Norwegian Block Exchange operates a cryptocurrency exchange, custodian and payment system focused on user experience, transparency and security. The company aims to become a hub for financial services and cryptocurrency economy.
/bit.ly/30qpUq3
Eurex Exchange Readiness Newsflash | Announcement of Member Section Release 2.7
Eurex
With this Newsflash, Eurex announces the introduction of the next Member Section enhancements: Member Section Release 2.7, which will go live on Monday, 20 December 2021. This release concentrates on enhancements to improve the user experience within the Member Section.
/bit.ly/3EUOIpb
November 2021 monthly figures at Eurex; Total notional outstanding in OTC clearing grew 15 percent year-on-year
Eurex
Overall volumes of traded financial derivatives at Eurex were down 5 percent in November 2021 - from 149.5 million to 142.6 million - compared to the same month last year. European interest rate derivatives grew strongly by 26 percent from 39.9 to 50.3 million traded contracts, while European equity index derivatives and equity derivatives contracted compared to the same period last year.
/bit.ly/3pVe5kh
BME Growth welcomes Solarprofit; It is the fifteenth company to list on BME Growth so far this year
BME-X
BME Growth today welcomed SOLARPROFIT, with the traditional Bell Ringing ceremony, which was held at the Barcelona Stock Exchange. Óscar Gómez and Roger Fernández, founding partners of the company, led the event, during which they were accompanied by Eduardo Ansaldo, Chairman of the Barcelona stock exchange, and Jesús González Nieto-Márquez, General Manager of BME Growth. The event was held with all security measures in place due to the health restrictions imposed by the Covid-19 pandemic, i.e. face mask and social distancing.
/bit.ly/3dSxAnU
-- Modification to Stress Shortfall Margin Add-on Program Parameters - Effective January 04, 2022 -- CME
-- Performance Bond Requirements: Energy & Agriculture - Effective December 14, 2021 -- CME
-- December 2021 Final Foreign Currency Settlement Prices -- CME
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| Fintech | | A roundup of today's market tech news and a look at tomorrow's disruptors | BSO expands European low-latency network to include Italy's Bergamo; Expansion by BSO will allow businesses to co-locate and directly access exchanges based in the region.
Wesley Bray - The Trade
Global infrastructure and connectivity provider BSO has gone live in Bergamo, Italy, in its latest move to expand the coverage of its low-latency network in Europe. Through the expansion of BSO's network into Bergamo, businesses can now co-locate
/bit.ly/3dOx9uK
MEAG digitises risk management workflows with BondIT partnership; BondIT analytics will be be used by MEAG to support credit exposure decisions during volatile market conditions.
Wesley Bray - The Trade
Asset manager MEAG has partnered with fixed income technology provider BondIT to digitise its credit risk workflows using the firm's Scorable Credit Analytics. The Scorable analytics will be used by the global credit research teams in Munich and New York at MEAG to support its credit exposure decisions during periods of market volatility.
/bit.ly/3DVpNAu
Bloomberg and Acadia launch new pre-trade analytics ahead of UMR Phase 6; Using Acadia's data tools, clients can run pre-trade standard initial margin model (SIMM) analytics through Bloomberg's multi-asset risk solutions (MARS) .
Annabel Smith - The Trade
Bloomberg and derivatives risk management services provider Acadia have integrated their respective initial margin capabilities to introduce new pre-trade calculations for users ahead of phase six of the Uncleared Margin Regulation in September next year.
/bit.ly/3oS6OSU
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| Cybersecurity | | Top stories for cybersecurity | Log4j flaw puts hundreds of millions of devices at risk, warns cybersecurity agency
Liam Tung - ZDNet
Top US government cybersecurity officials fear advanced hackers will have a field day with the Log4j vulnerability that's likely present in hundreds of millions of devices.
Security experts are already seeing widespread scanning for the Log4j vulnerability (also dubbed 'Log4Shell') on internet-connected devices running vulnerable versions of Log4j version 2, which have been under attack since December 1, although the bug became common knowledge on December 9.
/zd.net/33tYTTL
Let Customers Know Their Data Is Safe: Cybersecurity As A Marketing Tool
Reuven Aronashvili - Forbes
As medical equipment maker Philips has increased its cybersecurity measures in recent years, it has incorporated slogans like "Security by Design" and written blog posts on the topic. With these efforts, the company has not just increased its own cybersecurity but created new marketing content. In fact, the role of cybersecurity is now built into its narrative about delivering quality patient care.
This is an example of how communicating cybersecurity standards to consumers can reap business benefits and should play a key part in any company's marketing and advertising efforts.
/bit.ly/31ZIMN4
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| Cryptocurrencies | | Top stories for cryptocurrencies | Bank of England says growth of crypto sector risks financial instability
Teuta Franjkovic - Coin Rivet
The Bank of England says the rapid growth of cryptocurrency will create stability risks in the future. In its recent Financial Stability Report, the Bank of England said the pace of growth in crypto markets means they could become riskier as they become increasingly linked to wider financial networks.
/yhoo.it/3m3MBYB
Tesla to Accept Dogecoin as Payment for Some Products, Musk Says
Charles Capel and Elisabeth Behrmann - Bloomberg
Dogecoin cryptocurrency jumps 33% after tweet from Musk; Tesla CEO has supported Dogecoin with series of tweets
Elon Musk said Tesla Inc. will accept payment in Dogecoin for some merchandise, in the latest in a series of tweets supporting the cryptocurrency. Dogecoin jumped 33%.
/bloom.bg/30qfHtJ
Genesis Custody receives FCA approval as registered cryptoasset business; Approval positions Genesis Custody as one of the few crypto custodians approved to continue operating in the UK market.
Wesley Bray - The Trade
Digital currency prime brokerage Genesis has announced that Genesis Custody has received approval from the Financial Conduct Authority (FCA) as a registered cryptoasset business.
/bit.ly/3yohpID
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| Politics | | An overview of politics as it relates to the financial markets | Nato chief Jens Stoltenberg seeks to head Norway's central bank; Candidacy likely to spark debate over monetary policy independence and oversight of sovereign wealth fund
Richard Milne - FT
Nato secretary-general Jens Stoltenberg has applied to be Norway's next central bank governor in a move likely to spark fierce debate over the independence of monetary policy and oversight of the world's largest sovereign wealth fund.
/on.ft.com/3yngRTn
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| Regulation & Enforcement | | For more regulatory, visit MarketsReformWiki, our website focused on current market reform efforts. | NatWest fined £265m for money laundering failures; Bank failed to spot scheme that involved large cash deposits including £700,000 carried in bin bags
Jane Croft and Robert Wright - FT
NatWest was fined £264.7m by a London court on Monday after pleading guilty to failing to prevent a £365m alleged money laundering scheme that involved £700,000 being carried through a shopping centre in black bin liners.
/on.ft.com/3pMotus
UBS is told to pay EUR1.8 billion for helping rich French clients evade taxes.
Liz Alderman - NY Times
An appeals court in France on Monday ordered the Swiss bank UBS to pay a fine of 1.8 billion euros (about $2 billion) for helping rich clients evade taxes — less than half the penalty the bank had been ordered to pay two years ago in a sensational case that prosecutors had likened to the plot of a James Bond movie.
/nyti.ms/3pPJGUB
Regulator Shrunk Redress Plan After Bank, Treasury Meetings
Tom Metcalf - Bloomberg
U.K. watchdog barred 'sophisticated' customers from redress; The U.K.'s financial regulator decided to bar thousands of small companies from a compensation program after meetings with top British banks and the Treasury, according to an independent review of the process. The Financial Services Authority, the predecessor to the Financial Conduct Authority, excluded about a third of businesses who had been mis-sold interest rate hedging products after deeming them sophisticated enough not to warrant protection.
/bloom.bg/3dRqRe8
UK's 8 biggest lenders pass BoE stress test; Central bank brings back 'rainy day' fund requirement in first analysis of resilience since pandemic hit
Laura Noonan - FT
The UK's top eight banks could withstand a near tripling of national unemployment, a sharp fall in property prices and a large economic contraction, the Bank of England said on Monday evening, as it gave lenders a clean bill of health almost two years into the coronavirus pandemic.
/on.ft.com/3F1DqQ4
UBS Penalties Slashed by Around $3 Billion in French Tax Case; Court upholds Swiss bank's conviction in tax evasion case but cuts penalty
Margot Patrick, Nick Kostov - WSJ
A French appeals court ordered UBS Group AG to pay around $2 billion for helping wealthy clients in France evade taxes, reducing the size of an earlier penalty of around $5 billion. The court upheld the guilty verdict against the Swiss banking giant, in a case tried under French criminal law. However, it slashed an earlier fine of 3.7 billion euros, equivalent to around $4.2 billion, to 3.75 million euros, all but eliminating the largest chunk of penalties. It ruled that UBS must still pay 800 million euros in damages and interest, and ordered the confiscation of 1 billion euros.
/on.wsj.com/3EUK8at
ASIC welcomes new International Sustainability Standards Board and updated climate-related disclosure guidance
ASIC
On 3 November 2021, at COP 26, the International Financial Reporting Standards (IFRS) Foundation Trustees announced the establishment of the International Sustainability Standards Board (ISSB). The ISSB will develop high-quality global baseline climate and sustainability disclosure standards to meet investors' information needs.
/bit.ly/30o2H7K
ASIC welcomes senior leadership appointments
ASIC
ASIC is pleased to announce some senior executive and regional appointments, which will strengthen the capability and effectiveness of ASIC as a regulator.
Senior executive appointments
ASIC welcomes the following appointments to the Operations group:
Mrs Zak Hammer as Executive Director, Operations (commencing January 2022);
Mr Peter Dunlop, Chief Financial Officer; and
Ms Nicole Collins, Chief People Officer.
Reporting to Chief Operating Officer, Mr Warren Day, these appointments bring extensive technical expertise and industry experience to ASIC, drawn from the private and public sectors.
/bit.ly/3EWb3me
ASIC bans Sydney based financial advisers for five years
ASIC
ASIC has banned Gerald Cummings and Craig Allen for a period of five years. Mr Cummings was a director and authorised representative of Premier Wealth Management Financial Services Pty Ltd (Premier Wealth Management). Mr Allen is the current director, authorised representative and responsible manager of Premier Wealth Management.
/bit.ly/3GFmPBS
ASIC cancels AFS licence of Premier Wealth Management
ASiC
ASIC has cancelled the Australian Financial Services (AFS) licence of Sydney based financial services provider, Premier Wealth Management Financial Services Pty Ltd (Premier Wealth Management), effective 24 November 2021.
/bit.ly/30sV6oC
ASIC and APRA release notes on second Superannuation CEO Roundtable
ASIC
ASIC and APRA have released the public notes on the second Superannuation CEO Roundtable held on Wednesday 1 December 2021. The Roundtable was hosted by ASIC Commissioner Danielle Press and APRA Member Margaret Cole. It was attended by the CEOs of 11 superannuation trustees, representing all sectors of the industry.
/bit.ly/3pYD2v0
Falling Further Back - Statement on Chair Gensler's Regulatory Agenda
Commissioner Hester M. Peirce, Commissioner Elad L. Roisman - SEC
While Chair Gary Gensler's newly released regulatory agenda[1] is ambitious in scope, we are disappointed with its content. It fails to include any items intended to facilitate capital formation and misses opportunities to foster fair, orderly, and efficient markets and further investor protection. Instead the agenda is brimming with plans to redo recently completed rules, add new regulatory obligations, and constrain investor choice.
/bit.ly/3DVctw3
Statement on transfer of competences and duties relating to certain data reporting services providers from NCA's to ESMA
ESMA
The European Securities and Markets Authority (ESMA) is issuing this Statement to clarify the transfer of competences and duties relating to supervisory and enforcement activity in the field of certain data reporting services providers (DRSPs) from National Competent Authorities (NCAs) to ESMA.
/bit.ly/3DRU6YH
FINRA Announces Final Results of Targeted Examination of Unit Investment Trust Early Rollovers; Settlements Reached with Six Member Firms Resulted in Nearly $17 Million in Restitution to 10,000 Harmed Customers
FINRA
FINRA announced today that as a result of its targeted examination of Unit Investment Trust (UIT) early rollovers, FINRA has reached settlements with six member firms and obtained more than $16.8 million in restitution to approximately 10,000 investors. All of the firms, including two that agreed to settlements today,1 failed to reasonably supervise early rollovers of UITs, which caused customers to incur potentially excessive sales charges.
/bit.ly/3oRK6KG
FCA publishes the Swift Review into the supervisory intervention on interest rate hedging products
UK FCA
The FCA has accepted recommendations made by John Swift QC, who was commissioned to review the design, implementation and operation of the redress scheme set up for customers who were missold interest rate hedging products (IRHPs) from 2001.
/bit.ly/3m3rmGs
Contractual Standards for Digital Asset Derivatives
ISDA
Digital assets have experienced enormous growth over the past decade to reach almost $3 trillion in market value, and this has been accompanied by an increase in the number and diversity of market participants. As has been the case with other markets, derivatives will play an important role in the digital asset market, facilitating price discovery, increasing liquidity and allowing market participants to hedge.
/bit.ly/30sWQOG
IIFM and ISDA Publish IBOR Fallback Bilateral Amendment Agreement and Definitions Booklet
ISDA
The International Islamic Financial Market (IIFM) and ISDA today announced the publication of the ISDA/IIFM IBOR Fallback Definitions Booklet for Islamic Hedging Transactions, which will enable firms that transact under relevant documentation to agree to robust contractual fallbacks for certain key interbank offered rates (IBORs). IIFM and ISDA have also published an ISDA/IIFM Shari'ah-Compliant Bilateral Amendment Agreement template to enable institutions to agree with their counterparties to incorporate the fallbacks for existing Islamic hedges.
/bit.ly/3EUqafL
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| Investing & Trading | | Today's top stories from equities, indices and FICC (fixed income, currencies and commodities) | Holy cow! Colorado rancher bilked investors out of $5 million in cattle Ponzi scam
Lukas I. Alpert - MarketWatch
It was the moo-ther of all scams. A Colorado rancher has been sentenced to nearly 3½ years in prison for bilking investors out of nearly $5 million in a cattle ponzi scheme straight out of the Wild West. Richard K. Sears, 73, of Pueblo, admitted selling investors on the idea that he was developing a new breed of high-altitude cattle — the Rocky Mountain Romangus — that prosecutors say didn't yet exist.
/on.mktw.net/3yoc43X
Rich Business Owners Rethinking Retirement in Pandemic's Fallout
Benjamin Stupples - Bloomberg
Wealthy business owners worldwide are increasingly rethinking their plans for retirement in the fallout from the Covid-19 pandemic, a survey found. More than half of the 920 individuals and families who own businesses surveyed by BNP Paribas SA and Aon Plc. said they're altering the timetable for stepping away from their companies, with 41% delaying or phasing more slowly into a move and 13% accelerating it. Entrepreneurs and families surveyed in the U.S. were more likely than those elsewhere to be considering either delaying and accelerating their plans, the companies said in a report.
/bloom.bg/3ynpwoA
The Stock Market Is Suffering From Bad Breadth; The times when a large number of stocks were falling even when the broad indexes were rising usually presaged large corrections or even bear markets.
Jared Dillian - Bloomberg
One of the interesting aspects of the brief selloff in stocks in late November was that breadth deteriorated markedly. The broad indexes were only down a few percentage points, but there were more than a thousand stocks making 52-week lows on a daily basis. And, of course, the stocks that went up were the same ones that seem to always go up: Apple Inc., Microsoft Corp., Nvidia Corp. and a few others.
/bloom.bg/3F1zEpS
Investors Should Care About the Logic Behind the 'Powell Pivot'; There are all sorts of rationales behind Fed chief Jerome Powell's changed stance on inflation. Why he pivoted matters to investors.
James Mackintosh - WSJ
The Powell Pivot is the one thing that can compete with Omicron for investor attention. That will be clear when the Federal Reserve discusses a faster taper of its bond purchases at this week's meeting, due to conclude on Wednesday.
/on.wsj.com/3DRJGIz
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| Environmental, Social and Corporate Governance | | Stories about environmental, social and governance investing | Bank of America's Top Female Banker in Japan Puts Emphasis on ESG
Takashi Nakamichi and Takako Taniguchi - Bloomberg
When Tamao Sasada was put in charge of a large Japanese corporate client, she broke into a cold sweat. Now, the Bank of America Corp. executive is urging other female colleagues to take on new challenges as she forges a path in sustainable finance.
/yhoo.it/3oQw6RA
HSBC Says It Will Phase Out Financing of Thermal Coal by 2040
John Ainger - Bloomberg
Bank to stop thermal coal funding in European Union by 2030; HSBC can have the 'biggest impact' in Asia, CEO Quinn says
HSBC Holdings Plc is planning to phase out the financing of coal used for generating electricity by 2040, the latest bank to commit to ending support for the greenhouse gas-intensive fossil fuel.
/bloom.bg/3ETLnqj
Musk Wants SpaceX to Turn CO2 From Atmosphere Into Rocket Fuel
Bruce Einhorn - Bloomberg
Billionaire's plan would rely on untested carbon-removal tech; Announcement follows Time naming Musk Person of the Year
Billionaire Elon Musk is pushing ahead with an attempt to utilize emissions contributing to climate change, tweeting that his rocket company will launch a program to remove carbon dioxide from the atmosphere and use it to power spacecraft.
/bloom.bg/3dRaQVm
Norway Wealth Fund Ratchets Up Divestments Based on ESG Risk
Lars Erik Taraldsen - Bloomberg
Almost 370 stocks have been sold off since 2012, fund says; New ESG pre-screening tool means fund to exclude more stocks
Norway's $1.4 trillion wealth fund has exited hundreds of companies over the past decade to avoid the environmental, social and governance risk it says they represented.
/bloom.bg/3DW8TBH
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| Banks, Brokers & Managed Funds | | The latest from banks, brokers, hedge funds and managed futures | Goldman Sachs and JPMorgan Plan Bumper Bonuses to Get Edge
Sridhar Natarajan and Hannah Levitt - Bloomberg
The firms may set aside 40% or even 50% more to reward bankers; That contrasts with fixed-income traders whose revenue slumped
The two Wall Street investment-banking titans dominating this year's dealmaking frenzy are opening up their wallets to try to keep their bankers happy -- and ratcheting up pressure on rivals to follow suit.
/bloom.bg/3EWWIWq
Morgan Stanley Inks Global Student Accommodation Joint Venture
Gillian Tan - Bloomberg
Morgan Stanley's real estate investing arm has formed a joint venture with Global Student Accommodation with ambitions to tackle the fragmented U.S. student housing industry.
/bloom.bg/3oRAlMt
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| Regions | | Stories of local interest from the Americas, EMEA and Asia-Pacific regions | Europe Plans End-Date to Long-Term Gas Deals Favored by Russia
Ewa Krukowska and Alberto Nardelli - Bloomberg
The European Union is planning a hard deadline to end long-term contracts to import natural gas as part of its green shift, a setback for top supplier Russia. The bloc's executive arm wants to prevent such contracts from being extended beyond 2049 in a sweeping overhaul of its energy markets, according to documents seen by Bloomberg News. The European Commission will also propose measures to strengthen security of supply as the bloc faces record prices and acute shortages this winter.
/yhoo.it/31UMwiJ
Can Indoor Farms Reach Skyscraper Height? A proposed Shenzhen skyscraper would include a 51-story hydroponic farm, as hopes grow that vertical farms can help address food insecurity.
Bloomberg News
As indoor farms that don't rely on soil become a growing strategy to tackle food insecurity, one academic has a vision to take vertical farming to new heights in China's mega-cities: the farmscraper. Carlo Ratti, an architect who runs MIT's Senseable City Lab, is proposing a 51-story skyscraper for China's technology hub of Shenzhen with a large-scale vertical hydroponic farm inside that can produce crops like salad greens, berries and tomatoes to feed up to 40,000 people per year.
/bloom.bg/3oSHDzF
A Sunny Place for a Shady Online Business; Malta, home to hundreds of betting sites and dubious oversight, is a target of an international money laundering crackdown.
Willem Marx - Bloomberg
One spring night in 2007, Joseph Borg and several colleagues from Malta's tiny gaming commission stayed late at their office to listen to the news from London. Online gambling was still a relatively new industry, but Malta, a sun-scorched island nation south of Sicily in the Mediterranean, had recently passed a law allowing companies registered there to offer web-based casino and slot games to customers anywhere in the world. The U.K., by contrast, was about to announce a tax on profits generated by internet betting, a development Borg hoped would bring a rush of business to the European Union's smallest member state, which has just 500,000 citizens.
/bloom.bg/3dSiUFk
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| Miscellaneous | | Stories that don't quite fit under the other sections | Uber, Google, Ford Delay Office Return as Omicron's Spread Threatens Business Districts; Landlords and small businesses that rely on office workers agonize as companies let employees continue to work from home
Peter Grant - WSJ
Office-building owners and small businesses near such properties are bracing for another letdown in January, as the latest Covid-19 variant threatens to interfere with widespread company plans to return to the workplace. Before the Omicron variant surfaced overseas last month, employers throughout the U.S. were preparing to call back employees to the office after the holidays. Now, a small but rising number of companies have modified or delayed plans as uncertainties swirl over the severity of the variant and its resistance to vaccines. That list includes Lyft Inc., Ford Motor Co. , Uber Technologies Inc. and Alphabet Inc.'s Google, though not all point to the new variant as the reason.
/on.wsj.com/320VieW
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