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Professional ETF buyers look to diversify among product providers, reveals HSBC survey
October 30, 2012--More than a quarter, at 27%, of professional buyers of exchange-traded funds (ETFs) expect to widen the range of ETF providers they use over the coming three years, as professional asset allocators and investment advisers look to reduce exposure to any one provider going forward, according to a survey commissioned by HSBC Global Asset Management.
The report, which focused on the four largest ETF markets in Europe (the UK, Switzerland, France and Germany) further supports the assertion that the European ETF buying community wants to diversify across a wider range of providers, with 74% of respondents asserting they would not allocate any more than 20% to one provider, with the average allocation being 15.5%.
Lyxor joins Vanguard in dropping MSCI
October 30, 2012--French exchange-traded funds provider Lyxor has followed Vanguard and dropped MSCI as the index-provider for two of its funds, amid a battle between providers to cut fees.
Lyxor announced the change in an email, seen by Financial News, sent yesterday morning by a member of the Lyxor ETF sales team called Grégoire Blanc.
The email said: "Lyxor is changing the benchmark index for two equity ETFs in order to tailor the product offering to changes in market standards and improve our response to investor expectations. These switches will be effective after the close on 30 October 2012. The first trading day based on the new benchmark will be 31 October 2012."
Deutsche Bank tops European ETF broker list
October 30, 2012--Deutsche Bank, Morgan Stanley, JP Morgan and SG Equity Derivatives have been named Europe's top exchange-traded fund brokers, according to new research by Greenwich Associates.
The study, entitled '2012 Greenwich Leaders: European Equity Derivatives', was published earlier this month and based on an evaluation of ETF brokers’ market penetration and franchise quality.
Turkish stock market breaks record
October 30, 2012--The main 100 index of the İstanbul Stock Exchange (ÎMKB) hit a historic record high on Tuesday with 71,716.91 points.
The index rose 1,008.50 points, or 1.43 percent, to close at 71,716.91 points, breaking the previous record set in 2010.
The record came after an extended national holiday. A positive report by an international agency made a profound impact on the rise as the value of listed companies reached TL 506 billion.
ECB and Bank of Russia sign a Memorandum of Understanding
October 30, 2012--Mario Draghi, President of the European Central Bank (ECB), and Sergey M. Ignatiev, Chairman of the Bank of Russia, have signed a Memorandum of Understanding laying the groundwork for continued cooperation between the two institutions in the field of central banking.
The partnership is to consist in regular dialogue at the technical and policy levels, an information exchange on economic and financial developments, and a joint programme of cooperation activities. The parties agreed to focus on monetary policy, financial stability and banking supervision in the initial cooperation phase. The ECB will implement the programme of cooperation activities together with Eurosystem national central banks.
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Euro area economic and financial developments by institutional sector-2nd Quarter 2012
October 29, 2012--In the second quarter of 2012, the annual growth rate1 of households' gross disposable income
decreased to -0.2%, from 1.6% in the first quarter (see Table 2).
The annual growth rate of households’
consumption expenditure was 0.7% in the second quarter compared with 1.7% in the previous quarter.
The annual growth rate of households’ gross saving decreased to -3.7% in the second quarter, compared with 0.8% in the previous quarter.
The annual growth rate of households’ financing also decreased, to 1.1% (2012Q1: 1.9%) and that of financial investment to 2.0% (2012q1: 2.2%). The annual growth rate of households’ net worth2 decreased to -1.5% in the second quarter, compared with -0.6% in the previous quarter.
Redesign of Irish Investment Funds Regulation
October 29, 2012--The Central Bank of Ireland will tomorrow initiate a consultation on the Irish regulatory regime for non-UCITS funds. The consultation will outline the changes to be introduced in connection with the implementation of the Alternative Investment Fund Managers Directive ('AIFMD') in July 2013.
The AIFMD has presented the Central Bank with an opportunity to redesign the framework for the regulation of non-UCITS funds. The Central Bank is proposing an approach to non-UCITS regulation which aims to turn the Irish regulations into a proportionate investment funds framework which accommodates investors across a wide spectrum of capability and sophistication.
Following detailed preliminary discussions with industry on the implications of the forthcoming AIFMD, the Central Bank will set out a number of significant changes to its current regime for the regulation of funds authorised under Irish law. These proposals will be published in a draft ‘AIF Handbook’ which will consolidate all its current rules into a single rulebook for non-UCITS funds, and which will also include a number of major changes to its current approach.
Key highlights
Principal among the changes is a proposal to bring an end to the current Promoter approval process. Instead, the Central Bank is proposing to place additional reliance on the Alternative Investment Fund Manager (the ‘AIFM’) which must be appointed, under the terms of the AIFMD. The consultation also develops current requirements setting out the role of directors.
Q3/2012: net revenue of roughly half a billion euros in weak market environment
Net revenue of €471 million in weak market environment/Adjusted earnings per share of €0.87/Cost target for 2012 confirmed /Expenditures for growth are to be increased further in 2013/ Share buyback program of around €100 million in Q4/2012
October 29, 2012--Deutsche Börse AG published its results for the third quarter 2012, which continued to be dominated by a markedly weak market environment, on Monday.
At ö471.0 million, net revenue was considerably lower than in the previous year (Q3/2011: €578.6 million). In the prior-year period market participants had entered into more hedges than usual and regrouped their portfolios more frequently due to substantial volatility connected with the turbulence in the euro zone and the downgrade of the US credit rating. Despite increased expenses for growth initiatives, the Group’s adjusted operating costs amounted to €225.6 million, virtually on a level with the previous year. Adjusted for special items, earnings per share amounted to €0.87 in the third quarter of 2012.
Tougher rules to protect investors and curb high-frequency trading
Plenary Session Economic and monetary affairs
October 26, 2012--Investors should be better protected, and financial market trading made fairer, by draft EU rules voted by Parliament on Friday. These rules would apply to all investment firms and to almost all financial instruments, from bonds to commodity derivatives.
MEPs also tightened up proposed rules on high-frequency trading.
"This is the core of financial legislation: we regulate financial markets, rather than individual financial products, as we used to do in the past. All trading facilities must be subject to rules, which is why we established the organised trading facility category. We also want to have the clear rules on high-frequency trading, so as to curb speculation without harming the real economy. There is no risk-free financial market, but where there is financial trade, it should take place on regulated markets and be connected to the real economy", said lead MEP Markus Ferber (EPP, DE).
The new legislation would require any investment firm to act fairly, honestly and in the best interests of its clients when designing and selling investment products to professional or retail customers. Each firm would have to ensure that its product meets the needs of a defined category of clients.
Vienna 2 proposes enhancements in cross-border supervision to European authorities
October 26, 2012--The Steering Committee of the Vienna Initiative 2 has submitted observations and proposals on cross-border supervisory practices to a number of European authorities. 1
These focus on critical aspects of home-host cooperation, which are of particular importance for host countries in Central, Eastern, and Southeastern Europe where locally systemic affiliates of foreign banks operate.
The aim is to provide input for the designing of the supervisory framework for Europe and to communicate systemic concerns of host countries. The proposals have been shared with the EBA, the ECB and the European Commission.
The document reflects the Steering Committee’s views on implementation of cooperation between national authorities in home and host countries during the crisis. It draws on discussions between home and host country supervisors, central banks, fiscal authorities and key parent banks, including at a workshop hosted by the EBRD in London on September 12, 2012. Frequent contacts with other national authorities and with the private banking sector have added further insights.2
view the Observations on Cross-border Supervisory Practices document
