Europe ETP News Older Than 1 year-If your looking for specific news, using the search function will narrow down the results
FSA chairman says 'no silver bullet' to address 'too-big-to-fail' challenge
November 2, 2009-There is no ‘silver bullet’ to address the problem of banks being ‘too-big-to-fail’, but instead the answer lies in a combination of different policies between which trade-offs can be made, according to Adair Turner, speaking this morning at the FSA’s Turner Review Conference.
Reviewing the range of options to deal with large systemically important banks, Lord Turner argued that several had achieved consensus support, in particular, higher capital standards, the need to reduce interconnectedness in derivatives markets and the development of firms’ resolution and recovery plans (‘living wills’).
Lord Turner, therefore, focused on two issues where controversy still remains, namely, the narrow banking debate and the appropriate approach to the risks created by cross-border operations.
Addressing ‘narrow bank’ proposals which seek to separate utility banking from casino banking, Lord Turner argued that an extreme narrow banking model, with retail banks investing only in government securities, was certainly practical but failed to address the crucial issue of booms and busts in credit supply and as a result, could actually increase financial instability. But he suggested that the objectives behind a ‘new Glass Steagall’ distinction between commercial banks and proprietary trading were desirable and could be pursued by appropriate capital requirements and the use of resolution and recovery plans to drive internal distinctions between retail and trading activities.
Lord Turner stressed that:
"It is essential to progress this argument beyond the top line slogans, for or against narrow banking, and get down to details. The extreme narrow banking proposal is clearly doable in practical terms, but I believe could produce a financial system even more vulnerable to instability than the one we have today. In contrast the ‘new Glass Steagall’ divide is in principle attractive, but arguably best pursued through the capital requirements we place on trading activities rather than through an attempt to write a law prohibiting some activities and allowing others."
Turning to the approach to large cross-border banks, Lord Turner said that a crucial issue was the appropriate balance between regulatory focus on whole group capital and liquidity versus focus on the soundness of standalone national subsidiaries. He argued that the more standalone approach could be an answer to the “too-big-to-rescue” challenge. If each country was responsible for resolving problems in the local operations of a global group, rather than responsibility resting solely with the home nation of the group’s headquarters, an inevitable consequence would be host countries imposing stronger local capital and liquidity standards, creating standalone national subsidiaries. Whilst some commentators have argued this could lead to a harmful restriction of capital flows, Lord Turner said that this has not been demonstrated and that authorities in several emerging markets believed that standalone national subsidiaries helped guard against harmful volatility.
Lord Turner concluded:
"It is important that these ideas are challenged and others put on the table. This is why the paper we produced on 22 October is a discussion paper not a conclusions paper, and why we hope, through this conference and subsequent initiatives, to stimulate a wide ranging debate on these complex issues."
Contributing to the debate on these issues at today’s conference were Philipp Hildebrand, forthcoming Governor of the Swiss National Bank, Shyamala Gopinath Deputy Governor of the Reserve Bank of India, António Horta-Osório Chief Executive of Abbey National plc, Josef Ackermann Chairman of the Management Board and the Group Executive Committee of Deutsche Bank and Hector Sants, FSA chief executive.
Source: FSA.org
October trading in securitised derivatives up 18 percent at Boerse Stuttgart
November 2, 2009--Total exchange turnover more than 12 percent up on previous month/ Trading in securitised derivatives shows second consecutive monthly increase/ Volume of corporate bonds traded more than double figure for October 2008
November 2, 2009--According to the order book statistics, EUR 8.6 billion of securities were traded in October 2009 at Boerse Stuttgart, Germany’s leading exchange for retail investors, equivalent to a rise of over 12 percent on turnover for the previous month. From January to October 2009, trading volume as a whole was down approximately 20 percent on the same period in 2008.
“The stock markets have been reporting strong gains since March with global increases in the region of 60 percent. In October, many retail investors seem to have taken a more sceptical view of future developments following these enormous upward movements of the market, and from the middle of the month onwards they increasingly benefited from gains.” observed Dr Rolf Deml, Managing Director of Baden-Wuerttembergische Wertpapierboerse.
read more
Source: Boerse Stuttgart
Sahara Sun 'to help power Europe'
November 2, 2009--A sustainable energy initiative that will start with a huge solar project in the Sahara desert has been announced by a consortium of 12 European businesses.
The Desertec Industrial Initiative aims to supply Europe with 15% of its energy needs by 2050.
Companies who signed up to the $400bn (£240bn) venture include Deutsche Bank, Siemens and the energy provider E.On.
read more
Source: BBC
116 Billion Euros Turnover at Deutsche Börse’s Cash Market in October
15 million trades executed on Xetra/ Total volume of 130 billion euros traded on all stock exchanges in Germany
November 2, 2009--In October, 115.6 billion euros were traded on Xetra® and on the floor at Börse Frankfurt – a decrease of 57 percent year-on-year (October 2008: 270.3 billion euros). Of the 115.6 billion euros, 108.0 billion euros were traded on Xetra, a decrease of 58 percent year-on-year (October 2008: 255.1 billion euros). 7.5 billion euros were traded on the floor.
Turnover in German equities amounted to 96 billion euros, while foreign equities turnover stood at 12 billion euros. Xetra and the floor at Börse Frankfurt accounted for 97 percent of the transaction volume in German equities on all stock exchanges in Germany. 93 percent of foreign equities traded on stock exchanges in Germany were traded on Xetra and on the floor in Frankfurt.
In October, 15.2 million transactions were executed on Xetra, a decrease of 50 percent against the same period last year (October 2008: 30.2 million).
According to the Xetra liquidity measure (XLM), SAP AG was the most liquid DAX® blue chip in October with 6.1 basis points (bp) for an order volume of 100,000 euros. HeidelbergCement AG was the most liquid MDAX® stock with 19.4 bp. The most liquid ETF was the db-x-trackers II EONIA T.R. 1C with 0.3 bp. The most liquid foreign stock was Total S.A. with 16.5 bp. XLM measures liquidity in electronic securities trading on the basis of the implicit transaction costs. It is expressed in basis points (1 bp = 0.01 percent); a low XLM denotes high liquidity in a security.
Deutsche Bank AG was the DAX stock with the highest turnover on Xetra in October at 6.9 billion euros. HeidelbergCement AG was the top MDAX stock at 1.9 billion euros, while Deutsche Wohnen Bank AG led the SDAX® stocks at 66.8 million euros and Aixtron AG headed the TecDAX® at 981.8 million euros. At 1.8 billion euros, the iShares DAX was the exchange-traded fund with the highest turnover.
On all stock exchanges in Germany 130.1 billion euros were traded in October according to orderbook turnover statistics – a decrease of 56 percent compared year-on-year (October 2008: 293.4 billion euros). This total includes 119.1 billion euros in equities, warrants and exchange-traded funds, as well as 10.9 billion euros in fixed-income securities.
Source: Deutsche Börse
Deutsche Börse: Deutsche Börse launches pan-European blue chip trading on “Xetra International Market”
Key markets to be linked up gradually/
Coverage of DJ EURO STOXX 50 equities by mid-January 2010
November 2, 2009--Deutsche Börse has launched the initial phase of its pan-European trading segment “Xetra International Market” (XIM). As of today, Xetra participants can trade European blue chips via XIM and settle the transactions in their domestic market. The first stocks to be available for trading on XIM are the most liquid ones from Belgium, France and the Netherlands. These will be joined in a few weeks by stocks from Finland and Spain, and in mid-January 2010 by the Italian blue chips.
By introducing the individual markets progressively until mid-January 2010, Deutsche Börse is addressing the requirements of the market participants. All processes, systems and interfaces for trading, clearing and settlement can now be checked per domestic market along the entire process chain and integrated gradually.
By the end of the initial phase, a total of 96 equities in the trading currency EUR will have been accepted into the XIM trading segment. These will comprise the stocks from the DJ EURO STOXX 50® index and highly liquid stocks from other indices.
Transactions executed on Xetra International Market will be offset via Eurex Clearing and settled cost-effectively in the respective domestic markets. Clearstream forms the interface between Eurex Clearing and the domestic markets enabling it to use the latter's settlement liquidity.
Due to top market quality, the competitive price model, and the low set-up costs for participants, XIM will significantly strengthen Deutsche Börse’s competitive position on the European equities trading market. Deutsche Börse Group uses economies of scale for the new trading segment on Xetra and in the clearing house as XIM is set up on the existing infrastructure, generating hardly any additional costs in system operation. Deutsche Börse thus expects XIM to be a very sustainable business model.
Source: Deutsche Börse
CESR publishes an update on the assessement of the proposals for MiFID pre-trade transparency waivers
Octoner 30, 2009--The MiFID compliance of these functionalities has been assessed at CESR level on the basis of the new joint process that CESR launched in February 2009.
at CESR level on the basis of the new joint process that CESR launched in February 2009. The table(Ref. CESR/09-324) includes information on a new assessments made at CESR level regarding an application for a waiver to be granted on the basis of the MiFID Implementing Regulation that CESR considered not to be compliant with MiFID.
Source:
New Source ETC Launched on Xetra
October 30, 2009--An additional exchange-traded commodity from the ETC offering of Source Commodity Markets has been admitted to trading on Xetra®.
ETC name: S&P GSCI Enhanced Crude Oil Source T-ETC
Asset class: commodity
ISIN: XS0454792184
Management fee: 0.49 percent
Distribution policy: accumulating
Benchmark: S&P GSCI TM Crude Oil Enhanced Total Return Index
With the S&P GSCI Enhanced Crude Oil Source T-ETC, investors will be able to participate in the performance of the WTI Crude Oil futures contract for the first time. The S&P GSCI Crude Oil Enhanced TR Index is designed to alleviate the impact of negative roll returns which might occur when exchanging future contracts that are due to expire. The index applies a dynamic rolling rule when determining into which new expiration a WTI Crude Oil futures contract is rolled.
The product offering in Xetra’s ETC segment comprises 137 exchange-traded commodites, making it the largest offering of all European stock exchanges. The average monthly trading volume in ETCs amounts to around 400 million euros.
Source: Deutsche Börse
British Offshore Financial Centres
October 30, 2009--The final report of Michael Foot’s Review of the opportunities and challenges facing the British Crown Dependencies (Guernsey, Isle of Man, Jersey) and six Overseas Territories (Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Turks and Caicos Islands) was published on 29 October.
The recommendations made to these jurisdictions cover: the quality and extent of economic planning; meeting international standards on tax transparency, financial sector regulation, and tackling financial crime; ensuring that deposit protection schemes can be understood by depositors; considering whether an Ombudsman scheme is justified; and crisis prevention and resolution measures.
These recommendations provide benchmark standards against which each of the jurisdictions can assess their performance and consider what action may be necessary to ensure a sustainable future. The report suggests that the jurisdictions should periodically publish reports on how the benchmark standards are being met, or on how and when they will be met.
View Final report of the independent Review of British offshore financial centres
viw the Deloitte Report-Understanding Corporate Usage of
British Crown Dependencies and
Overseas Territories
Source: HM Treasury
Pensions Regulator investigation finds mixed standards in DC pre-retirement literature
October 29, 2009--Good practice in the provision of pre-retirement literature in DC trust-based schemes is the focus of a report published today by the Pensions Regulator.
Material from 97 trust-based DC schemes was assessed on adherence with legislative requirements, good practice in areas such as the description and prominence of the Open Market Option, and the use of clear, plain English.
The review has provided valuable insight into current practice in this area and has highlighted that levels of compliance and good practice vary widely across the DC market.
Of 97 schemes who submitted literature:
98% offered the open market option (OMO), although take up of the OMO was viewed as remaining low, at 23% of DC members retiring
57% of schemes had some scope for improvement in the standards of the retirement information sent to members
30% had alleged legislative breaches of retirement disclosure regulations
6% were referred to regulator casework teams to follow up the substantial changes required to their retirement literature or processes
Following the publication of the report, a letter will be sent to 4,500 schemes, highlighting the findings of our investigation and encouraging trustees to review the pre-retirement literature sent out to their members.
“Compliance with the legislative requirements is important as a minimum standard, says June Mulroy, Pensions Regulator executive director of operations.
But we expect to see adoption of good practice as the norm. This will help members to make the right decisions at retirement, which we recognise can make a significant difference to the income they receive.
It is encouraging to see examples of excellent practice, but we do recognise that there is room for improvement. The economic downturn has had an impact on the value of many DC members' pension savings and as such the importance of making informed decisions is higher than ever.”
The study is part of an ongoing campaign focused on increasing the support and guidance offered to members in DC schemes through improving standards in administration and governance across the DC market.
view report-A review of retirement information for DC members
Source: Pensions Regulator
Divided EU leaders urged to agree climate funding
October 29, 2009--The Swedish EU presidency urged European leaders to use Thursday's summit to agree on hard figures to help poor nations tackle climate change, amid resistance especially from eastern Europe.
But while leaders have already agreed on broad objectives for reducing greenhouse gas emissions, vowing to cut them by 20 percent by 2020, they are split on how to share the costs, both within and outside Europe.
"I want a mention of a sum... let's see what is possible, it's coming close to the decisive moment, we're not ready yet," said Swedish Prime Minister Fredrik Reinfeldt, whose country holds the rotating EU presidency.
:read more
Source: EU Business
If you are looking for a particuliar article and can not find it, please feel free to contact us for assistace.
