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Number of Dutch schemes with SRI policies doubles within three years, say pension associations
Survey by Dutch occupational pension umbrella organisations.
February 3, 2010--Almost three quarters (73%) of Dutch pension schemes surveyed have adopted a responsible investment policy that influences the way they run their assets.
The number has more than doubled since 2006 according to the survey by the country’s umbrella pensions organizations, reports ipe.com. A further 10% of the pension funds polled is understood to be developing an equivalent RI policy, according to the survey of 90 of the country’s schemes by the Association of Dutch Industry-wide Pension Funds (VB), the Foundation for Company Pension Funds (OPF) and the Union of Occupational Pension Funds (UvB). Members of the three associations represent 80% of the estimated e700bn in Dutch occupational pension fund assets, one of the biggest European pensions markets. Just 13 of the plans surveyed said they had decided not to implement an RI policy. The majority of large pension funds with assets over €1bn has an SRI policy in place, the report said. Most of the funds surveyed (56 schemes) say they relate their investment policy to UN Global Compact policy.
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Source: Responsible Investor
Unscheduled Free Float Adjustment in MDAX
February 3, 2010--Deutsche Börse has announced an unscheduled adjustment to the free float of Continental AG in MDAX®. Due to an increase in share capital, the free float of Continental AG increased by more than 10 percentage points.
According to the index rules, the company’s free float will be increased from the current 11.1 percent to 24.87 percent.
The adjustment will be effective next Friday, 5 February 2010.
The next regular review of the Deutsche Börse equity indices is scheduled for 3 March 2010.
Source: Deutsche Börse
UK official holdings of International Reserves
February 2, 2010--UK official holdings of international reserves - January 2010 are now available.
Part I: UK Government Foreign Currency Assets and Liabilities – January 2010
1. The UK Government’s net reserves fell by $250 million in January 2010, bringing the end-January total to $32,675 million (£20,391 million1) compared with $32,925 million (£20,388
million2) at end-December 2009.
view UK official holdings of international reserves
Source: HM Treasury
EuroCCP to Begin Clearing Exchange-Traded Currencies
New Service Brings Greater Efficiency, Cost Savings and Risk Mitigation
London
February 2, 2010 - EuroCCP today announced that on Friday, the 5th of February, it will launch clearing services for European-listed Exchange-Traded Currencies (Currency ETCs), continuing to extend to new instruments the efficiency, cost-saving and counterparty risk protection benefits it currently provides to clients’ equity and Depositary Receipts transactions.
Turquoise will be the first multilateral trading facility (MTF) to offer trading in Currency ETCs cleared through EuroCCP.
Currency ETCs are liquid securities traded on exchange that track the performance of underlying currency indices. EuroCCP initially will clear 18 Currency ETCs, which provide long or short passive exposure to the currencies of G-10 countries versus the US dollar. To view the list of EuroCCP-clearable Currency ETCs, please go to www.euroccp.co.uk.
“EuroCCP is pleased to extend our clearing services to support the trading of Currency ETCs. By providing a safe post-trade environment, we believe this service offering will encourage liquidity,” said Andrew Simpson, head of EuroCCP Product Management in London. “Our ETCs clearing service responds to investor demand for liquid, secure and transparent exchange-traded securities and also reflects increased investor appetite for foreign exchange instruments.”
Adrian Farnham, Chief Operating Officer at Turquoise, commented: “Currency ETCs are presenting the European market with new trading opportunities. Turquoise is delighted to provide highly efficient access to such an expanding market, along with the competitive pricing schedule and robust technology that the Turquoise MTF already offers for equities and depositary receipts.”
Listed in both USD and GBP, ETC transactions cleared through EuroCCP will settle in CREST.
ETCs trade on a regulated exchange, just as an equity is traded. An issuer creates (and redeems) the ETC security with the assistance of an Authorised Participant/Market Maker, and each ETC is assigned an ISIN when listed on exchange.
Source: EuroCCP
Tougher approach on poor record-keeping
February 2, 2010--Trustees and those responsible for administering workplace pensions will need to improve standards of record keeping. The Pensions Regulator published a consultation today setting out standards for member records and requiring schemes that fall short to take steps to improve their performance.
Following extensive research and engagement with pension providers and employers during 2009, the regulator has built on guidance published last year, which provided a framework for the clarification and assessment of member records.
Take-up of this guidance – which set out the common data schemes were required to hold – fell below the levels expected. Only 19% of schemes surveyed had checked that they had all the fundamental common data. Of these, some 53% appeared to be missing more than one item of this data.
The regulator will continue to 'educate and enable' schemes to improve their record keeping performance but is clear now that further measures are needed. Under these proposals, it will now be a requirement for all schemes to maintain high-quality standards of data.
view the Record-keeping:measuring member data-Consultation paper
Source: Pensions Regulator
Regulations and general guidelines governing remuneration policies in credit institutions, investment firms and fund management companies-Finan
Finansinspektionen’s Regulatory Code
February 2, 2010-Summary
Firms shall have a remuneration policy that is consistent with good risk management and does not encourage short-term profits and excessive risk-taking. The new regulation provides guidance regarding how performance should be measured and how risks should be managed when applying variable compensation.
The board of directors’ responsibility for the firm’s remuneration policy is clarified as well as which information regarding remuneration should be disclosed in conjunction with the annual report.
For employees whose actions can have a material impact on the risk exposure of the firm, at least 60 per cent of the variable remuneration should be deferred for at least three years. The firm can decide that the deferred payment can be cancelled in part or in whole under certain circumstances, such as if the firm’s position is significantly weakened.
The regulation is based on the EU Commission's recommendation K(2009) 3159 governing remuneration policy within the financial services sector. In these efforts, Finansinspektionen has also implemented the global principles for sound remuneration systems which were adopted at the G20 meeting in September 2009.
The new regulations and general guidelines entered into force on 1 January 2010. A company shall, in terms of employees whose actions can have a material impact on the firm's risk exposure, in decisions regarding remuneration for the period prior to 1 January 2010, apply the regulations and general guidelines contained in Chapters 2 and 5.
view document
Source: Finansinspektionen
CPSS - IOSCO review of standards for payment, clearing and settlement systems
February 2, 2010--The Committee on Payment and Settlement Systems (CPSS) and the Technical Committee of the International Organization of Securities Commissions (IOSCO) have launched a comprehensive review of their existing standards for financial market infrastructures such as payment systems, securities settlement systems and central counterparties.
There are three sets of standards involved, namely:
the 2001 Core principles for systemically important payment systems
the 2001/2 Recommendations for securities settlement systems
the 2004 Recommendations for central counterparties
Financial market infrastructures generally performed well during the recent financial crisis, and did much to help prevent the crisis becoming even more serious than it actually was. Nevertheless, the committees believe that there are lessons to be learned from the crisis and, indeed, from the experience of more normal operation in the years that have passed since the standards were originally issued. It thus seems timely to review the standards with a view to strengthening them where appropriate.
Robust financial market infrastructures make an essential contribution to financial stability by reducing what could otherwise be a major source of systemic risk. Moreover, insofar as they enable settlement to take place without significant counterparty risk, they also help markets to remain liquid even during times of financial stress.
The review will be led by representatives of the central banks that are members of the CPSS and those of the securities regulators that are members of the IOSCO Technical Committee. The International Monetary Fund and the World Bank are also participating in the review. The review is part of the Financial Stability Board's work to reduce the risks that arise from interconnectedness in the financial system.
The committees will coordinate with other relevant authorities and communicate with the industry, as appropriate, as the work progresses. They aim to issue a draft of all the revised standards for public consultation by early 2011.
Separately, as announced in the press release on 20 July 2009, the CPSS and the Technical Committee of IOSCO are already in the process of providing guidance on how the 2004 Recommendations for central counterparties should be applied to CCPs handling OTC derivatives. The guidance will also cover other relevant infrastructures handling OTC derivatives such as trade repositories. This aspect of the work has been put on a fast track because of the new CCPs for OTC derivatives and trade repositories that have recently started, or are about to start, operating. A consultative document on the guidance will be issued within the next few months. This new guidance will not entail amendments to the existing recommendations for CCPs but will of course be incorporated into the general review of the standards that has now begun.
Source: IOSCO
FSA steps up cross-border fraud probes
February 2, 2010--Investigations of overseas banks and companies were dramatically stepped up by the City watchdog last year as the financial crisis brought to light potentially improper behaviour that crossed international lines.
The Financial Services Authority’s enforcement division investigated 30 overseas businesses, a six-fold jump over the five it looked at in 2008, according to information obtained by Freshfields, the law firm, through a freedom of information request. Overseas companies accounted for 15 per cent of probes, up from 2.4 per cent the previous year.
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Source: FT.com
Currency ETC Assets Rise to $49mn and Trading Volumes Soar as Investors Build Long US Dollar Positions and Turn Negative on the Euro as Greek Debt Crisis Worsens
Assets rise to over $49 million following successful launch on the LSE
Trading volume reach weekly record, up 240% since start of 2010
February 2, 2010--ETF Securities (ETFS), which launched the world’s largest and Europe’s first platform of Exchange Traded Currencies (Currency ETCs) in November 2009, has seen assets in the platform grow to $49 million since inception with weekly trading volumes continuing their growth, up 240% since the start of 2010.
Currency ETCs which are Long USD and short G10 currencies have seen the most interest from investors, making up 81% of assets. The interest has occurred as the USD strengthened 6.7% versus the Dollar Index (DXY index) since the recent low on 25th November 2009 to 29th January 2010. ETFS Short EUR Long USD (SEUR) has been the most popular trade in 2010, capturing 50% of new assets, while the Australian dollar held the most net long positions. The platform has seen continuous increases in turnover since inception. 80% of trading volumes have occurred in ETCs which are long USD and short G10 currencies, with ETFS Short EUR Long USD (SEUR) taking 21% share of trading volumes, followed by ETFS Short AUD Long USD (SAD) and ETFS Short GBP Long USD (SGBP) with 18% each.
Martin Arnold, Senior Analyst, ETF Securities, commented:
“Sentiment in the foreign exchange market has changed dramatically over the past week as investors increasingly question whether the strong price performance of risk assets in 2009 can be sustained in 2010. The Eurozone is firmly in the spotlight for FX investors, with Greece’s debt problems weighing heavily on the Euro. Monetary tightening in China and India has also been a catalyst for increasing risk aversion. The market pessimism has pushed currency volatilities higher in recent days, and it should come as no surprise that the highest yielding currencies are also under pressure. Investors are not only looking to ETFS Short EUR Long USD (SEUR) to implement ‘safety’ strategies, but are beginning to unwind risk via ETFS Short AUD Long USD (SAD) and ETFS Short NZD Long USD (SNZD)”.
Currency ETCs which were Long USD (except for Japanese Yen) performed best as the USD strengthened. The table below shows the best performing currencies since inception of the Currency ETCs on 12th November 2009 and also the past 12 months. Over the last 12 months, long versions of the higher yielding G-10 currency indices were in the top five performers such as the Australian Dollar and New Zealand Dollar.
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Source: ETF Securities
Source adds J.P. Morgan and Nomura as shareholders
February 1, 2010--Launched less than one year ago, Source promised investors that it would offer exchange-traded products with reduced counterparty risk and increased liquidity in a fragmented and opaque market.
Adrian Valenzuela, managing director and global co-head of equity distribution at J.P. Morgan, says: “We are delighted to become a partner of Source in leading the transformation of the ETF market place, responding to investors’ demand for enhanced liquidity and control standards.”
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Source: ETF Express
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