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ESMA Grants Brexit Relief to UK-Based Clearing Houses Following a review of UK-based central counterparties (CCPs) and central securities depositories (CSDs), the European Securities and Markets Authority (ESMA) has announced that in the event of a no-deal Brexit, three CCPs established in the UK – LCH Limited, ICE Clear Europe Limited and LME Clear Limited – will be recognised to provide their services in the European Union. ESMA says it has adopted these recognition decisions in order to limit the risk of disruption in central clearing and to avoid any negative impact on the financial stability of the EU.
SGX Starts 2019 with Record FX Volumes Trading on SGX’s FX futures hit an all-time in January, with $105 billion in notional value and 1.87 million in aggregate contracts traded. Year-on-year, this represents a 60% growth in terms of notional value and a 30% growth in the volume of contracts traded. Average daily volume (ADV) of contracts traded last month grew to approximately 85,000 contracts from 68,000 in January 2018, while the notional ADV traded per day grew to $4.8 billion in January 2019, up from $3.1 billion the same month the previous year.
GFXC Survey Confirms Increased Code Adoption, but Work Still Required The 2018 FX Global Code Survey results have been released and while, expectedly, the last year saw significantly increased adoption rates amongst firms, there are areas of potential concern for proponents of the Code. The survey aims to measure the awareness, adoption, implementation, and effects of the Global Code for market participants. The GFXC says the information collected through the 2018 survey is an important input as it continues to promote, maintain, and update the Code and embed it in the fabric of foreign exchange markets.
“Cover and Deal? Model Requires Role Disclosure – GFXC A second working group set up by the Global Foreign Exchange Committee (GFXC) in 2018 to look at how market participants operating the “cover and deal” model utilise last look has published a paper highlighting areas in which it believes practice can be improved. Primarily, the report stresses the importance of those operating cover and deal models ensuring that there is adequate disclosure of the practice, the way in which it is being used, and the clarification of the role and capacity in which the participant acts.
GFXC Releases Initial Views on Anonymous Venue Disclosures As part of its report on disclosures and transparency, the Global Foreign Exchange Committee (GFXC) has unveiled some initial views on a second stream of work by its disclosures working group on practices in the anonymous e-trading platform sector. The work centred on the knowledge of counterparties and expectations around counterparty behaviour, although the report does note that given that the landscape of e-trading platforms is diverse with different features and business models across infrastructure providers and users, the working group will continue work to consider this portion of the disclosure landscape
GFXC Publishes Disclosures Report A Global Foreign Exchange Committee working group has released a paper on the role of disclosure and transparency in FX markets intended to serve as a source of information for market participants seeking to learn about, develop and navigate the FX disclosure landscape. The paper is the work of a special working group set up by the GFXC to study the issue after feedback on last look practices highlighted concerns amongst participants that disclosures and transparency levels could be enhanced.
Goldman FX Traders Exit to Establish Sports Betting Site Profit & Loss understands that two FX traders at Goldman Sachs have left the firm to set up a sports betting site called Sportstack. The two traders, Kristian Brauten-Smith and Nick Smith were both based in London, Krauten-Smith had been at Goldman for seven years as a G10 spot trader and Smith had been at the bank for just under three years also as a G10 spot trader, having joined from a similar spell on Citi’s FX desk in London.
FastMatch Settles with Galinov FastMatch and Dmitri Galinov, the founder and former CEO of the company, have resolved the lawsuit filed by Galinov against FastMatch and its parent company, Euronext US.Under the terms of the settlement, neither party admits any liability or wrongdoing.“The settlement is in the best interests of the company, its employees and clients,” says a release announcing the agreement.Galinov left the company on 6 June, 2018 and is “pursuing other interests”, according to the release.Profit & Loss was unable to immediately contact a spokesperson for Euronext, while a spokesperson for Galinov says that as part of the settlement agreement both parties are unable to comment on the terms of the agreement.
FX Connect Announces Technology Upgrades FX Connect has announced a range of technology enhancements, including to its GUI, automated order routers (AOR) and order blotter.“In today’s highly competitive environment where firms face increased complexity and regulatory requirements, it’s vital that we work with our clients to shape our product and solution strategy,” says Beverley Doherty, global head of FX Connect. “Our new enhancements will be instrumental in helping us accomplish this goal, demonstrating FX Connect’s ability to innovate and improve products that create solutions for our clients’ evolving needs.”Making changes via HTML5, FX Connect is creating a trading “cockpit” within its GUI that provides order management and execution through a single, secure interface.Changes to the order blotter include live indicative rates, the estimated percentage away from an order’s limit price, colour coding of orders based on their per cent away from their custom threshold settings and customisable order alters.
Former Deutsche FX Trader Sentenced for Fraudulent Activity An Australian court has sentenced former Sydney-based Deutsche Bank FX options and futures trader Andrew Donaldson to 18 months imprisonment after he pled guilty to falsifying entries in Deutsche’s internal financial records and systems. Donaldson pleaded guilty to one charge of using his position dishonestly with the intention of directly or indirectly gaining an advantage for himself, however the sentence was fully suspended and he was released on his own recognisance with a condition to be of good behaviour for two years and a security sum of AUD 10,000.