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CFTC Issues CCP Recovery, Wind-Down Guidance The US Commodity Futures Trading Commission’s (CFTC) Division of Clearing and Risk (DCR) has issued guidance to clearinghouses to further the development of recovery plans and wind-down Plans.  The CFTC says that for clearinghouses, or Derivatives Clearing Organisations (DCOs), the development of these plans is “a critical element of risk management and contingency planning to address the extreme circumstances that could threaten DCOs’ viability and financial strength, and is required by CFTC regulations”. The guidance highlights certain topics that the CFTC says that clearinghouses should a...
HKEX Subsidiary Gets Approval for Cross Currency Swaps Clearing OTC Clearing Hong Kong Limited (OTC Clear), a subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), has received regulatory approval to clear cross currency swaps. Following the approval, granted by the Securities and Futures Commission, OTC Clear says that it expects to launch the service in August of this year, OTC Clear will initially provide clearing for swaps in the USD/CNH currency pair.  The swaps are traded actively in Hong Kong, where they are often used by issuers in the RMB - or dim sum - bond market to swap the proceeds into another currency. "This launch is an importan...
RMB Sixth Most Popular Payments Currency in June, Down YoY The Chinese Renminbi has seen a slight slowdown in terms of global payments by value in June, being surpassed by the Canadian dollar and standing as the sixth most popular currency, according to Swift. Swift data shows that the RMB had a share of 1.72% in global payments by value in June, against 1.96% of the CAD. Nevertheless, the outlook for the internationalisation of the RMB remains encouraging, saccording to Swift’s CEO for APAC and EMEA, Alain Raes. “Despite a recent slowdown, RMB internationalisation is continuing by most measures, such as payments, bank adoption and offshore clearin...
US Justice Department Brings Charges Against Two FX Traders Mark Johnson, the head of global FX cash trading at HSBC and Stuart Scott, former head of FX cash trading for EMEA at HSBC, have been officially charged by the US Justice Department with conspiring to defraud HSBC clients by front running orders. Profit & Loss reported yesterday on the reports emerging that Johnson had been arrested at JFK airport in New York in connection with the Justice Department’s ongoing FX rigging investigation, which have now been confirmed. Profit & Loss also reported on Scott's dismissal from HSBC when it was revealed in December 2014. “As alleged, the defendants p...
Mandelzis to Step Down as CEO of EBS BrokerTec Gil Mandelzis has decided to step down from his position as CEO of EBS BrokerTec, and will be leaving the company in due course, Icap announced today.  In a statement issued today regarding this news Michael Spencer, CEO of Icap, hails Mandelzis as “a truly outstanding leader” of the firms’ electronic market division who has played “a central role in the successful expansion and integration of the EBS and BrokerTec businesses”. He continues: “Gil co-founded Traiana back in 2000, a business ICAP acquired in 2007, and has undoubtedly made a lasting and meaningful contribution to the evolution...
Webinar: Will Buy Side FX Activity Shift to Order Books? Whether more buy side FX trading activity will shift into order books, and how long this shift could take, was a key discussion point in a webinar examining FX market structure on Tuesday. During the webinar, hosted by Greenwich Associates, data was presented showing that between 73-76% of buy side FX trading takes place electronically, making it the most electronic institutional market. Commenting on this data Chip Lowry, senior managing director at State Street Global Markets, noted that it doesn’t actually show which electronic method of execution is most popular amongst these buy sid...
Reports: HSBC Executive Arrested in Currency Investigation A senior HSBC executive has been arrested in New York in connection to the US Justice Department’s FX rigging investigation, according to various news outlets. These reports are naming the person arrested as Mark Johnson, global head of FX cash trading in London, and claiming that he was picked up by US authorities at New York’s JFK airport on Tuesday evening. Speaking on Bloomberg TV, Winnie O’Kelly, legal and financial regulation executive editor at Bloomberg, claimed that charges will shortly be brought against Johnson for wire fraud and that it is related to the FX market investigation t...
US Fed Bans Former FX Trader From Banking The US Federal Reserve Board has banned former Barclays and UBS FX trader, Matthew Gardiner, from working in the banking industry for his manipulation of FX pricing benchmarks. The board says that from January 2008 until at least January 2013 that Gardiner “routinely engaged in unsafe and unsound conduct” that included disclosing confidential customer information to traders at other banks and coordinating the trading of EUR/USD in relation to FX benchmarks with traders at other banks. The order issued by the board today also says that he coordinated with traders of other institutions regardi...
Shift to Reformed Euribor Expected in H1 2017, FSB Says Implementation of a reformed Euro Interbank Offered Rate (Euribor) is expected to happen in the first half of 2017, according to the Financial Stability Board (FSB). The FSB – which groups G20 financial authorities - has published an update on the process of reforming major interest rate benchmarks at international level on the back of its July 2014 recommendations, which were issued in response to cases of attempted manipulation of key interbank interest rate benchmarks (Ibors). In the statement, it highlights the progress made so far at European level by the administrator of Euribor, the E...
Uberoi Departs Bats Natasha Uberoi has left her position as director, FX sales, at Bats Global Markets in New York, according to market sources. Although a spokesperson for Bats declined to comment on the news, Profit & Loss understands that Uberoi left the firm on Monday, with her next destination currently unknown at this point in time.  Uberoi had been with Bats for just over a year, having joined the exchange group from Bank of America, where she was a vice president, FX sales.  Prior to joining Bank of America in 2013, Uberoi spent over two years working as an associate, Barx sales, at Barclays Capital. S...