Regions Archives - The TRADE

Broadridge tapped by First Abu Dhabi Bank to build global agency securities finance business

Wesley Bray — Wed, 11 Dec 2024 11:07:12 +0000

First Abu Dhabi Bank (FAB) has chosen Broadridge Financial Solutions to support the build out of its global agency securities finance business.

By leveraging Broadridge’s Securities Finance and Collateral Management (SFCM) solution, FAB will be able to bolster its coverage of global fixed income and equities markets.

The development comes as part of the bank’s drive to expand securities lending in the UAE and wider Middle East.

“This collaboration caters for the growing demand for securities lending and borrowing within the Middle East and is aligned both with local regulatory needs and with international best practices,” said Darren Crowther, head of securities finance and collateral management at Broadridge.

Broadridge’s provision of its SFCM platform — the first AWS SaaS deployment in the region — demonstrates a renewed focus in the Middle East and indicates readiness to support FAB’s strategic goals, the firm said in a statement.

As FAB navigates the evolving landscape of securities borrowing and lending regulations in the region’s markets.

The collaboration is also expected to yield new opportunities and efficiencies for FAB that will benefit clients across the globe – particularly as it navigates the evolving landscape of securities borrowing and lending regulations in the region’s markets.

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TP ICAP bolsters regional operations with new Dubai office

Wesley Bray — Mon, 02 Dec 2024 11:31:11 +0000

Market infrastructure provider TP ICAP Group has expanded its Middle East operations with the opening of a new office in the Dubai International Financial Centre (DIFC).

The new office, which is three times larger than its existing facility, will bring the company closer to its clients, with the aim to better deliver services across the Middle East and North Africa (MENA) region.

The office is located in Central Park Towers and will act as a strategic hub for TP ICAP’s business operations across the region. In addition, the new location will bring together key brands under the Group umbrella, including ICAP, Tullett Prebon, PVM, Parameta Solutions, and COEX.

The expansion will enable clients to access TP ICAP’s market data and broking solutions, backed by a strong local presence.

The regional hub was developed to address UAE-based client needs and other key marketplaces in region, alongside being positioned to serve important Asian markets.

“At TP ICAP we put our clients first, being closer to them, understanding their needs and the landscape in which they operate, enables us to anticipate how we can best serve them in the future,” said Christophe Moser, managing director and head of Dubai.

“This expansion in the DIFC, one of the world’s premier and fastest growing financial hubs, underscores the Group’s vision of delivering industry-leading liquidity and data solutions, broadening its market reach in a pivotal and high-growth region.”

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Can the Capital Markets Union save Europe from mediocrity?

Wesley Bray — Thu, 07 Nov 2024 10:21:04 +0000

The EU has a problem. It’s falling behind. Growth has been largely stagnant across the continent for the last two decades, with a wide number of metrics pointing to an ever-increasing investment and growth gap with the US.

The recently-published EU competitiveness report, penned by former prime minister of Italy Mario Draghi, is the latest in a long line of research projects that has shone a spotlight on the EU capital markets, reaching a similar conclusion to those gone before it: things need to change. If the EU wishes to be a competitive force on the global stage, there has to be a fundamental rethink of how the bloc operates.

At the heart of the problem is the fact that the EU is not a favourable location for a company to scale and compete effectively with their US (and now Chinese) counterparts. The Draghi report points out that only four of the world’s top 50 tech companies are European, while there isn’t a single EU company with a market capitalisation over ¤100 billion that has been established in the last 50 years.

Consequentially and simultaneously, the landscape for investors in the region is equally tricky. A key problem, for organisations and investors alike, is the muddled patchwork of rules and regulations across the continent, forged independently over centuries, which they must manoeuvre through to operate effectively.

So, the question now for the EU decision-makers is: how do you make the EU competitive again? The current plan is the Capital Markets Union (CMU): a flagship initiative designed to boost investment, enhance access to finance, enable cross-border investment, and reduce the fragmentation of Europe’s financial markets.

Sounds great, right? The problem though, is that the CMU has struggled to gain traction throughout the member states since its ideation in 2014. The lumbering, 27-pronged consortium is burdened with a deep-rooted inertia as consensus on policy and legislation can often be so hard to come by. Combine this with a rising nationalistic sentiment sweeping through the region, driving a further wedge between the EU and its harmonisation goals, and it is becomes abundantly clear that change won’t be easy.

But 10 years on, the political impetus surrounding the CMU seems to be reinvigorated. The string of damning reports appears to have awoken the beast, with government ministers and institutions across the continent coming forward with plans to kickstart Europe’s new age.

“The race is on and I want Europe to switch gear,” said Ursula von der Leyen, upon successfully securing a second mandate as European Commission President in July.

A more hospitable environment

To unlock those opportunities for growth and to boost investor power in the region, there needs to be a simplification of the disparate systems that exist within the EU.

“If you have 25 to 30 smaller places that operate independent of one another – this can be in Europe or anywhere else – the liquidity and interoperability associated between jurisdictions becomes limited,” explained Okan Pekin, head of securities services at Citi, at a recent AFME conference. “As a result, even if the investors want to bring in hundreds of billions of dollars of capital, getting in and out will become problematic because of frictional costs. So, by virtue of your market structures, you are impeding investor attractiveness.”

Take withholding tax, for example. Each country within the bloc has their own approach to the reliefs and refunds process, which are often complex, burdensome procedures that can actually serve as a deterrent for cross-border investment – particularly for individual and small investors. In some cases, the process takes years.

Another pertinent example is the provision of depositary services, where there is currently no passporting service available to asset servicers in the EU. “[This is] close to our heart as a provider of depositary services,” says Ben Pott, international head of public policy and government affairs at BNY. “You cannot provide cross-border depositary services under UCITS or AIFMD – which, when you talk about a unified Capital Markets Union, is a big miss.”

Insolvency laws, pension schemes, corporate actions, shareholder rights, securities laws – the list goes on. For Europe to become an attractive place for investors and issuers, the EU must tackle these regulatory divergences head on.

“It is not that Europe does not have the cash and investment potential,” says Sam Riley, CEO of Clearstream. “It is about market attractiveness for local and international investors.”

Harmonised post-trade as the bedrock for growth

The disparate frameworks also have a detrimental impact on the post-trade landscape, which faces its own fragmentation problems. To unlock those opportunities for growth and to boost investor power in the region, a harmonised post-trade landscape must form the bedrock on which other initiatives can sit. Without a smooth and efficient post-trade environment, the CMU risks stagnation as fragmented systems will continue to stifle market access and growth.

“We have said for a long time that when you look at some of the post-trade processes, there is still a significant amount of scope for harmonisation, for allowing much more effective cross-border provision for Europe to move closer together,” says Pott. “Historically when you look at the integration of investment services, there is a lot that has happened on the execution side, and not as much on the post-trade side.”

The Draghi report calls for a centralisation of clearing and settlement systems, with a single central counterparty platform (CCP) and a single central securities depositary (CSD) – but the acquisition and integration of 27 CSDs and 14 CCPs is an unrealistic, expensive and time-consuming task. Instead, a focus on strategic partnerships and interoperability would likely yield faster results.

As Riley, points out, over 90% of settlement activity within the EU is processed at three institutions. “That’s the reality,” he says. “We and the two other main CSDs in Europe have already progressed in providing consistency and harmonisation across platforms and processes. That naturally leads to consolidation.

“The challenge is determining what the top priorities for capital markets harmonisation are. What can we realistically achieve? Competition is good; it is healthy. It drives service quality, innovation and efficiency. Eliminating competition would not be a good idea, as it would limit investor choice.”

While progress has undoubtedly been slow-moving, there is a clear desire to bolster harmonisation across the post-trade landscape. Connectivity upgrades to the T2S are due to be rolled out next year, while the CSDR refit will enable the possibility of closer collaboration between CSDs.

Another notable success has been the integration of Euroclear Bank as the domestic CSD in Ireland. Following Brexit, the Irish market agreed that the asset protection framework on domestic securities would be governed by Belgian law, with Euroclear Bank now serving as the CSD for Irish securities. As pointed out in Euroclear’s Unlocking scale and competitiveness in Europe’s market report, the example shows that full CSD consolidation is possible and could serve as the basis for similar efforts in other countries, but it “requires the support of market participants and national authorities”.

The problem is that initiatives often encounter the same national barriers impacting regulatory alignment, as Pablo Portgual, senior director, public affairs at Euroclear, described at the AFME conference: “Some countries, for national security reasons, have a big problem with outsourcing, and that effectively prevents the creation of synergies between infrastructures.”

Next steps

With the political motivations seemingly in the right place, and the key areas identified to boost harmonisation, the next step is to put the plan into action – which may be easier said than done.

The rising tide of nationalism in Europe is placing increased pressures on domestic governments to take more inward-looking approaches when it comes to policy. The age of globalisation is grinding to a halt, with the European collective set to suffer as a result.

“People want to have their cake and eat it,” explained Pekin. “They want interoperability, they want union, they want integration – but also, nobody wants to give up anything from their national sovereignty agendas. So how do you square that circle? If you want a Capital Markets Union, you want no barriers, you want the single CSD – you may never get there in our lifetime. So, the next question becomes: what can you do in the meantime? You can start with interoperability; you can start with data – it’s a critical point.”

Therein lies the challenge for the EU. Policy makers and country leaders need to try and get those wheels turning again, and instil within these local governments a belief that a more consolidated Europe would bear fruit to all participants.

“Convincing is the word, and that is our daily business,” said Marcel Haag, director of horizontal policies at the European Commission, at the AFME event. “We are engaging with member states and we hear them out and we exchange arguments. A lot of member states will say, ‘our priority is to grow our national market’ or ‘we are on the periphery, we have an underdeveloped capital market’. We have to engage, assess the pros and the cons, and let’s see how we can accommodate their concerns.”

While some are eager to ensure an aligned approach across the 27 countries, others are not so patient. Talk of a breakaway coalition within the EU has picked up pace in recent months, with Spain’s minister for the economy, Carlos Cuerpo, outlining proposals to the Financial Times in October for a new mechanism that would allow three or more countries to proceed on joint initiatives without the inclusion of other member states.

On such a project, Haag said: “EU law allows for this under certain conditions. Of course, the Commission’s role is not to divide and create different leagues, but to unite and create a united Europe. Solutions that would allow a smaller group of member states to go forward faster, that for us is always the second best option.”

A ‘28th regime’

A separate proposal – set out in the Draghi report – recommends the establishment of a “28th regime”, whereby a special legal framework is created outside of the 27 different legal frameworks with a view to shortening the length of national procedures and integrating them into a single process.

“It’s a really interesting piece, which is gaining traction,” says Pott. “Rather than saying to member states, you have to all conform to a single system and we’re going to do away with the existing 27, you say to businesses that want to adopt the 28th regime that they can move in that direction.

“It might work better in some areas than others,” he continues. “For taxation, it won’t work so well because business is still bound by its local taxation rules. But when you think about insolvency rules, for example, which was one of those intractable areas where it’s very difficult to move beyond the national insolvency provisions that exist, having a 28th regime that firms could opt into, would be a helpful alternative and maybe overcome some of those national sensitivities of giving up or doing away with national systems.”

How ever the bloc plans to move forward, it’s important to get the ball rolling as soon as possible. The gap between Europe and the US is only widening – a 2023 report from the European Centre for International Political Economy found that the gap between US GDP per capita and EU GDP per capita rose from 47% in 2010 to 82% in 2021.

Harmonised tax and investment frameworks, and a unified post-trade environment are not just a technical necessity; they are the foundation upon which a successful Capital Markets Union can be built, enabling Europe’s capital markets to thrive on the global stage.

“I hope the political momentum and spotlight that we have in Europe at the moment can help us provide the right context to drive change,” said Portugal. “A lot depends on the market and on FMIs collaborating with their clients and with the ecosystem to deliver that call for more integration, more efficiency and cost reduction.”

Yes, the project is vast and the road will be long, but the EU and the financial services industry has the opportunity to spearhead something great in Europe. It’s time to make it happen.

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Leaders in Trading New York 2024: Buy-side shortlists revealed

Claudia Preece — Wed, 23 Oct 2024 11:48:41 +0000

The TRADE is delighted to announce the buy-side shortlists for its inaugural Leaders in Trading New York Awards for North America.

This year, The TRADE is proud to be celebrating its twentieth anniversary and to mark the momentous occasion we are excited to be launching the first North American iteration of our famous Leaders in Trading awards.

The shortlists for the Leaders in Trading New York Buy-Side Awards have been produced following a slew of nominations from key industry players across North America, recognising whom amongst their peers stand out as the most deserving of these recognitions.

Congratulations to all those nominated across the five categories! The winners will be announced at the Leaders in Trading New York glittering awards night to be held at Chelsea Piers in New York City on 19 November.

“The Buy-Side Awards are the highlight of Leaders in Trading,” said The TRADE’s editor Annabel Smith. “We couldn’t be more excited to be bringing the magic of Leaders in Trading over to the US for the first time in The TRADE’s 20-year history.”

The categories for the Buy-Side Awards include the coveted Trader of the Year – Long Only, Trader of the Year – Hedge Fund, the Trading Desk of the Year Awards, and Buy-Side Market Structure Expert of the Year.

Also set to be recognised on the night are this year’s Rising Stars of Trading and Execution, North America – to be announced in due course.

Many congratulations to all the shortlisted individuals and teams, it will be a night to remember!

Trader of the Year – Long Only

Megan Davidson, BlackRock

Chris Fiorito, River Road Asset Management

Stephanie Fraser, Baillie Gifford

Jay Peters, Artisan Partners

Jason Siegendorf, Harris | Oakmark

Trader of the Year – Hedge Fund

David Alfred, Conversant Capital

Adam Nemser, Southpoint Capital

Keith Roscoe, Jericho Capital Asset Management

Craig Tscherne, Verition Fund Management

Renato Zimberknopf, Fourth Sail Capital

Trading Desk of the Year

Balyasny Asset Management

BlackRock

Millennium

Thompson, Siegel & Walmsley LLC

Wellington Management 

Fixed Income Trading Desk of the Year

Invesco

Janus Henderson

Legal & General Investment Management (LGIM)

PIMCO

T. Rowe Price

Buy-Side Market Structure Expert of the Year

Simon Cohen, Morgan Stanley Investment Management

Dan Eisemann, MFS Investment Management

Melissa Hinmon, Glenmede Investment Management

Mett Kinack, T. Rowe Price

Ed McBride, Centiva Management

Key contacts at The TRADE

Please contact Patrick Wright at patrick.wright@thetradenews.com for sponsorship opportunities or to book a table for Leaders in Trading New York.

If you are a member of the buy-side community and would like information on attending please contact Karen Delahoy at karen.delahoy@thetradenews.com or Annabel Smith at annabel.smith@thetradenews.com.

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Marex Prime Services establishes UAE presence

Claudia Preece — Mon, 07 Oct 2024 11:34:07 +0000

Marex Prime Services has established a “dedicated presence” in Dubai as the firm looks to bolster its operations in the Middle East.

Mazen Najjar

The builds on the firm’s existing presence in the region as Marex looks to enhance its offering to institutional clients across MENA.

Shahab Hashemi, chief executive (MENA) at Marex, said: “This strategic move strengthens our current operations and better positions us meet the evolving needs of our clients in the region. Incorporating prime services to our offering allows us to deliver more tailored and localised solutions to hedge funds, family offices and other institutional clients.”

As part of this push, Mazen Najjar has been appointed in an institutional sales role in the prime services team, the first hire for the team in the jurisdiction. Prior to joining Marex, Dubai-based Najjar spent six years at IG Prime.

Mazen is set to focus on developing the prime services team’s regional sales strategy, bolstering its presence in the region and forging partnerships.

“We welcome Mazen Najjar to our Dubai office. His extensive experience in prime brokerage and client-led approach will be invaluable in delivering localised support to our growing hedge fund and family office client base,” said Jack Seibald, global co-head of prime services and outsourced trading at Marex.

“This development builds on Marex’s momentum in the region and reinforces our commitment to providing enhanced support and tailored solutions to institutional clients.”

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China Minsheng Bank enhances market-making capabilities through adoption of Bloomberg sell-side solutions

Wesley Bray — Thu, 22 Aug 2024 10:41:07 +0000

China Minsheng Bank has adopted Bloomberg’s sell-side execution management solution, ETOMS, alongside expanding its use of Trade Order Management Solutions (TOMS).

The development will be used to support the commercial bank’s RMB cash bond market-making under Bond Connect and its USD interest rate swap (IRS) market-making in Hong Kong.

Bloomberg’s sell-side solutions – which include TOMS and ETOMS – will allow the bank to optimise its trading services for international investors; automate the workflows of bond pricing, sales and trade execution; and electronify USD IRS market-making.

“As China’s financial markets continue to open up, China Minsheng Bank is committed to strengthening ties and communications with foreign investors and enhancing our market-making capabilities,” said Qingyu Wang, head of financial markets department at China Minsheng Bank.

“Our collaboration with Bloomberg provides automated workflows for better operational efficiency, a transparent price display channel to facilitate informed decision-making and a means to reach out to global investors.”

TOMS was previously adopted by China Minsheng Bank to book multiple asset class exposures, enabling real-time profit and loss and risk analysis, as well as integration with back-office settlement systems.

The addition of ETOMS will enable the commercial bank to send customised quotes to clients, provide pre-trade quotes and axes into aggregation tools, and display real-time quotes on a designated page of the bank on the Bloomberg Terminal, bolstering communication and trading efficiency among investors overseas.

“We are pleased to strengthen our partnership with China Minsheng Bank and support its international business development with our industry-leading sell-side solutions,” said Dahai Wang, head of Greater China at Bloomberg.

“Electronic trading and automated workflows are important trends in global finance, enhancing competitiveness through more accurate pricing, smoother trade execution, and efficient risk management.”

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Millennium Advisors launches Singapore office

Claudia Preece — Fri, 16 Aug 2024 11:02:24 +0000

Fixed income proprietary trading firm Millenium Advisors has opened a new office in Singapore as it continues its expansion across Asia.

Announced on social media, the move was described as marking “a significant milestone in Millennium Advisors’ growth, reinforcing [its] commitment to the APAC region”.

The strategic development is set to pave the way for enhanced global operations for the firm, as well as signalling Millennium Advisors’ commitment to its counterparties.

Earlier this year, Millennium Advisors partnered with fixed income software solutions provider Investortools to streamline workflows for municipal bond investment managers through digitisation.

Through the partnership, Millennium is set to be fully featured as an electronic trading package for straight-through-processing, enabling users to lift, bid, counter and receive allocation details electronically directly within Investortools’ software.

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UOB becomes first Singaporean bank to join LSEG NDF matching platform

Claudia Preece — Fri, 16 Aug 2024 09:22:48 +0000

Singaporean bank UOB has become the first in the country to join LSEG FX’s NDF Matching and clear its first trade using LCH ForexClear.

Rohit Verma

The platform, aimed at the global FX market, combines the benefits of an NDF CLOB with clearing.

Rohit Verma, head of post-trade Asia Pacific at LSEG, said: “As a leader in the Asian NDF market and Singapore’s first LCH ForexClear member, we look forward to supporting their clearing activity on the platform.”

LSEG’s fully cleared non-deliverable forwards (NDF) matching platform went live in November 2023 following the initial announcement in May.

The Singapore-based platform has the backing of the Monetary Authority of Singapore (MAS) and represented the first stage of LSEG re-platforming its FX venues to its core technology.

Kelvin Ng, group head of global markets, at UOB, said: “Through this service, we are able to benefit from enhanced execution and access to cleared liquidity in addition to the operational efficiencies that LSEG’s end to-end-solution provides.”

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Interactive Brokers and HSBC collaborate on single platform trading solution

Claudia Preece — Wed, 10 Jul 2024 10:05:07 +0000

Interactive Brokers is set to provide HSBC with a new trading solution aimed at providing comprehensive, single platform to trade assets in the UAE.

Steven Sanders

Through this new alliance, HSBC clients will have access to WorldTrader – powered by Interactive Brokers – a new digital investment platform allowing customers in the UAE to trade equities, ETFs, and bonds in 25 markets across 77 exchanges.

Clients can trade via both a mobile app or online platform, with additional markets expected to be added.

Steven Sanders, EVP of marketing and product development at Interactive Brokers, said: “We are pleased that HSBC has chosen Interactive Brokers, a premier provider of white branded solutions for introducing brokers and banks.

“Our suite of services includes powerful technology and trading tools, competitive pricing, and access to global markets. Institutions worldwide continue to select our platform to streamline their businesses and meet the needs of their clients efficiently.”

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Avelacom enhances low latency service offering following authorisation from Brazil Stock Exchange

Claudia Preece — Thu, 04 Jul 2024 10:08:57 +0000

Avelacom has expanded its low latency solution portfolio through enabling access to the Brazil Stock Exchange (B3), providing clients a direct market access port to B3’s matching engine.

Aleksey Larichev

This development comes as Avelacom becomes an RCB (Rede de Comunicação B3 – B3 Communications Network) provider.

Through RCB’s connectivity method, Avelacom has gained access to all of B3’s markets, including equities, derivatives, digital assets, and OTC. It also opens the door to the exchange’s post-trade and testing environments.

The move facilitates low latency access to B3 for all trading participants and extends the exchange’s services to numerous additional global markets.

Aleksey Larichev, chief executive of Avelacom, said: “Becoming an RCB authorised party allows us to provide more flexible and cost-effective solutions with various capacity options, helping financial firms operate more efficiently.”

Avelacom’s network allows clients to test and trade B3 by receiving market data feeds and trading remotely as well as on-site without needing to be collocated in B3’s data centre.

Marcos Guimaraes, Managing Director of Avelacom, LATAM, asserted the importance of this step for the business: “With this development, B3 markets becomes available at all markets on Avelacom´s global network. It also lowers the barrier of entering B3’s market from abroad by facilitating access to the trading floor and lowering costs for local brokers and trading participants.”

The move comes at a key time for Brazil, a market which has received more and more attention in recent times as global clients turn their heads towards its capital markets.

An Acuiti report from March found that almost 68% of proprietary trading firms are planning to trade on new exchanges in 2024, with Brazil touted as a main area of focus, along with Asia-Pacific.

Expansion into the market has been predicted for some time with players keeping a close eye on its performance in recent times.

Speaking to The TRADE in October 2023, emerging markets expert Mark Mobius highlighted the significant potential of looking further afield: “We’re finding companies that are most profitable and have great growth opportunities in Brazil, Taiwan, South Korea, Turkey, South Africa.”

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