US – Finadium

Regulatory

NSFR, OTC derivatives, Repo, topstory, US

US regulators released their final draft rules of the Net Stable Funding Ratio last week, in spite of calls for delays or scrapping this poorly designed regulation altogether. The go-live…

FT article speculates on impact of US prime money fund closures to funding markets

September 16, 2020

FT, Money Markets, prime funds, US

Asset managers overhaul money market funds after March rout — Joseph Abate, a managing director at Barclays, expects increased scrutiny over the size of the funds’ liquidity buffers, holdings and…

FT: EU set to extend access to London clearing houses to mid-2022

September 16, 2020

Anna Reitman

Brexit, Clearing houses, EU, US

The EU is preparing to offer its banks an 18-month extension on access to London’s crucial markets infrastructure as it seeks to prevent a jolt to financial stability when the…

The big advances in OFR’s new repo data sets (Premium)

September 14, 2020

Repo

OFR, Repo, topstory, US

The US Office of Financial Research’s (OFR) release last week of daily repo data will benefit transparency for both the industry and systemic risk oversight. Finadium clients can now access…

Office of Financial Research releases US repo funding data

September 9, 2020

OFR, Repo, US

The U.S. Office of Financial Research (OFR) released its new U.S. Repo Markets Data Release, a prototype publication of daily data on repo markets, and unveiled the Short-term Funding Monitor,…

Stradley Ronon: New DOL Rule Proposal Risks Chilling Proxy Voting and Shareholder Engagement

September 2, 2020

Department of Labor, proxy voting, Stradley Ronan, US

The U.S. Department of Labor (DOL) released its long-awaited proxy voting rule proposal on Aug. 31. If adopted without modification, fiduciaries of plans (e.g., investment managers) subject to the U.S. Employee Retirement…

US regulators provide flexibility to banks adopting CECL in 2020

August 27, 2020

CECL, US

The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively, the agencies) are adopting a final…

Collateral policy and fee splits as key choices for US pensions in securities lending

August 18, 2020

Neal Mahoney

Securities Lending

Securities Lending, topstory, US, US pensions

In their securities lending operations, US public pensions plans offer a massive pool of funding from some of the largest institutional investors. A group of 96 US pensions analyzed by…

Assessing the benefits of loosening Dodd-Frank’s Collins Amendment (Premium)

August 10, 2020

Basel III, Federal Reserve, Regulatory, US

Basel III, Collins Amendment, Dodd-Frank, Federal Reserve, topstory, US, US Senate

US Republican Senators and the Federal Reserve are interested in changing Dodd-Frank’s Collins Amendment. The left is outraged that banking rules could be eased. What’s the right thing to do…

Webinar Replay: Revenues and Expenses of US Mutual Funds and ETFs in Securities Lending

July 15, 2020

SEC, Securities Lending

ETFs, mutual funds, sec, Securities Lending, topstory, US

Finadium presented our analysis of US mutual fund and ETF fund filings in securities lending for calendar year 2019, covering annual reports, Statements of Additional Information, and forms N-CEN and…

Fed shift to afternoon repo operations helps pricing but not volumes (Premium)

July 6, 2020

Federal Reserve, Repo, topstory, US

The decision by the Federal Reserve effective June 22, 2020 to move repo operations to the afternoon is showing up in higher US Treasury repo rates. Both the data and…

Client Webinar July 15: Revenues and Expenses of US Mutual Funds and ETFs in Securities Lending

June 30, 2020

ETFs, Investments, Securities Lending

ETFs, mutual funds, Securities Lending, topstory, US

July 15, 2020 10AM New York 3PM London 4PM Paris/Frankfurt This Finadium client webinar will present our analysis of US mutual fund and ETF fund filings in securities lending for…

“People are policy”: Quarles and Brainard at the Federal Reserve (Premium)

June 29, 2020

Federal Reserve, Regulatory

Federal Reserve, Regulation, topstory, US

COVID-19 has sped up the already moving trend of deregulation in US financial markets. The idea that “people are policy”, attributed by himself to Edwin Feulner of the conservative Heritage…

US regulators finalize amendments to margin rules for inter-affiliate swaps and LIBOR legacy swaps

June 25, 2020

collateral management, inter-affiliate swaps, LIBOR, Margin, Swaps, US

Five federal agencies have finalized changes to their swap margin rule to facilitate the implementation of prudent risk management strategies at banks and other entities with significant swap activities. Under…

American Banker: Two US Senators ask regulators to undo change to Supplementary Leverage Ratio

June 23, 2020

Supplementary Leverage Ratio, US

Warren and Brown urge regulators to undo recent capital change Two Democratic senators are calling on regulators to reverse their recent decision to ease a key capital requirement for banks.…

What drove US and EU government repo rates last week (Premium)

June 8, 2020

ECB, Federal Reserve, Repo

ECB, EU, Federal Reserve, GCF Repo, IOER, RepoFunds Rate, topstory, US

It can be hard to track the rationale behind government repo market pricing around the world, especially in the face of massive central bank intervention. In a new development, one…

Do low US repo rates mean the Fed should increase asset purchases… or lay off? (Premium)

June 1, 2020

Federal Reserve, investments, money market funds, Repo, topstory, US

Low US repo rates for most of April and May, with a slight uptick only last week as some cash demand left the market, makes us wonder if the Federal…

US regulators agree on more detailed changes to Supplementary Leverage Ratio exclusion of US Treasuries

May 16, 2020

Supplementary Leverage Ratio, US, US Treasuries

The federal bank regulatory agencies today announced temporary changes to their supplementary leverage ratio rule. The temporary modifications will provide flexibility to certain depository institutions to expand their balance sheets…

What needs to happen for US repo to regain spreads? (Premium)

April 20, 2020

Federal Reserve, GCF, IOER, Repo, SOFR, topstory, US

At the end of 2018, US repo traders told us that they were no longer worried about liquidity but spreads were a big concern. Calendar year 2019 saw liquidity pitfalls…

Coronavirus puts another dent in dollar’s role as reserve currency (Premium)

March 23, 2020

Liquidity Management, US

dollar liquidity, reserve currency, topstory, US

American’s economic competitors are seeing dollar liquidity stress this month as a sign to evaluate their plans: should they continue to rely on the dollar as their reserve and trading…

Coronavirus: US funding news update

March 3, 2020

Federal Reserve

coronavirus, topstory, US

-> Fed cuts rates by 50 bps: “the coronavirus poses evolving risks to economic activity. In light of these risks and in support of achieving its maximum employment and price…

Benchmarking cash collateral management fees in US securities lending (Premium)

February 25, 2020

Cash management, Collateral Management, Securities Lending

cash collateral, ETFs, mutual funds, Securities Lending, topstory, US

Finadium has conducted an annual review of cash collateral management fees for US 40 Act funds in securities lending programs. As usual, the data need some analysis to find what…

Why Financial Transaction Taxes grab headlines but are not fit for purpose

February 24, 2020

Tax

EU, Financial Transaction Tax, topstory, US

crypto regulation, Federal Reserve of New York, Securities and Exchange Commission, US

Financial Transaction Taxes (FTT) make for great political soundbites. Tax the banks! Raise revenues! There are a bunch of ways to get that job done but FTTs aren’t it. Here’s…

New York Fed’s general counsel on US regulations and approaches to cryptocurrencies

December 13, 2019

Anna Reitman

News and Notes – Fintech

Remarks by Michael Held, executive vice president and general counsel, at the BIS Central Bank Legal Experts’ Meeting, Basel, Switzerland, December 3 2019 Policy makers and regulators in the United…

Finadium: US Repo at Year-End 2019: The Hard Choices Ahead

December 10, 2019

Repo, US

Repo, topstory, US

This report reviews the state of US repo markets at year-end 2019. It provides market sizing across multiple portions of US repo, lessons derived from the events of September 16-20,…

Independent dealer association calls for diversity, decrease in concentration in US repo markets

December 9, 2019

Independent Dealer and Trader Association, Repo, US

White Paper on the Repo Market Affecting U.S. Treasury and Agency MBS Independent Dealer and Trader Association The goal of this White Paper is to foster a greater understanding of…

US adoption of SA-CCR means easing for derivatives clearers and incremental liquidity for big banks

November 21, 2019

Basel III, Derivatives, Federal Reserve, Regulatory, US

Current Exposure Method, SA-CCR, topstory, US

You could hear the collective sigh of relief: at last US regulators have issued final rules for adopting the Standardized Approach for measuring counterparty credit risk (SA-CCR). Here’s a review…

US regulators allow custodians to exclude central bank deposits for the Supplementary Leverage Ratio

November 19, 2019

Custodians, Supplementary Leverage Ratio, US

The federal bank regulatory agencies have finalized changes to a capital requirement for banking organizations predominantly engaged in custodial activities, as required by the Economic Growth, Regulatory Relief, and Consumer…

US regulators adopt SA-CCR

November 19, 2019

SA-CCR, US

Three federal bank regulatory agencies on Tuesday jointly announced a final rule updating how certain banking organizations are required to measure counterparty credit risk for derivative contracts under their regulatory…

A move towards ultrashort cash collateral vehicles has some worried about liquidity risk (Premium)

October 29, 2019

Cash management, Securities Lending

asset managers, cash collateral, Securities Lending, topstory, ultrashort, US

New survey data shows US asset managers increasing their use of ultra-short funds for securities lending cash collateral investments. Is this slight increase in risk over prime funds a cause…

US regulators propose to end IM for inter-affiliate transactions

October 28, 2019

Initial Margin, inter-affiliate transactions, OTC derivatives, US

Five federal agencies today announced a proposal to change the swap margin rules to facilitate the implementation of prudent risk management strategies at certain banks and swap entities. The swap…

The Long and Short of US Prime Brokerage Pricing in 2019

October 10, 2019

Robert Sackett

Hedge Funds, Prime Brokerage, Securities Lending, US

hedge funds, Prime Brokerage, stock loan, topstory, US

Pricing in the current Prime Brokerage market remains competitive due to various factors including excess liquidity, new entrants, and a renewed focus by institutions to attract and retain stable accrual…

The Fed does the right thing for repo by offering term liquidity through quarter end (Premium)

September 23, 2019

Federal Reserve, Liquidity, Repo, topstory, US

On Friday, the Federal Reserve announced that it would be providing term repo liquidity of at least $30 billion for multiple days, effectively getting the market over the quarter end.…

US Senators introduce financial transaction tax proposal

May 24, 2019

Financial Transaction Tax, FTT, US

From The Hill: Sen. Bernie Sanders (I-Vt.) and Rep. Barbara Lee (D-Calif.) on Wednesday introduced legislation to tax stock, bond and derivatives trading. The Inclusive Prosperity Act, co-sponsored by Sen.…

US regulators propose limits to big banks holding TLAC of other big banks

April 2, 2019

Regulatory, TLAC, US

The federal banking agencies on Tuesday proposed a rule to limit the interconnectedness of large banking organizations and reduce the impact from failure of the largest banking organizations. The proposal…

F&C: preview of US’ PSD2 as banks clamp down on fintech data access

March 27, 2019

Anna Reitman

News and Notes – Fintech

Open Banking, US

Long-simmering tensions between the financial industry and Silicon Valley startups are erupting behind-the-scenes into a battle over the reams of valuable data held inside Americans’ bank accounts. In recent months,…

Industry associations ask for revisions to US SA-CCR plans

March 18, 2019

SA-CCR, US

ISDA, SIFMA, ABA, BPI and FIA Comment on Proposed Standardized Approach for Calculating Exposure Amount of Derivatives Contracts Washington, DC, March 18, 2019 – The International Swaps and Derivatives Association,…

The Hill: Dems offer legislation to tax financial transactions

March 7, 2019

Financial Transactions Tax, US

Democrats on Tuesday introduced legislation in the House and Senate to tax financial transactions, as lawmakers in the party examine various ways to raise more revenue. Legislation was introduced in…

Finadium: US Pension Plans in Securities Lending

February 27, 2019

Pensions, Securities Lending

pensions, Securities Lending, topstory, US

Finadium presents the collected data of 78 US pension securities lending programs including most of the largest US state, county and city funds. Our analysis covers revenues, fee splits, collateral…

For US banks, is CCAR or the Leverage Ratio the binding constraint on securities finance

February 20, 2019

Basel III, Federal Reserve, Regulatory, US

CCAR, Leverage Ratio, topstory, US

The Federal Reserve’s Comprehensive Capital Adequacy Review (CCAR) stress test are more of a binding constraint on bank’s use of capital than the Leverage Ratio for some activities, for example…

What’s in the US OFR’s new repo data collection rules (Premium)

February 18, 2019

Big Data, cleared repo, Regulatory, Repo, US

CCP, FICC, OFR, Repo, topstory, US

The US Office of Financial Research last week released its final rules for repo data collection from CCPs with open commitments of $50 billion in repo activity over the last…

Eurex clears first swap transaction for U.S. end clients

February 11, 2019

Eurex, OTC derivatives, US

Eurex Clearing, one of the world’s leading central counterparties (CCP), has cleared its first swap transaction for end clients domiciled in the U.S. Citi is the first futures commission merchant…

Comments on whether the US NSFR will be a binding constraint on securities finance

February 6, 2019

Basel III, Regulatory, US

NSFR, Regulation, topstory, US

The final US Net Stable Funding Ratio (NSFR) rules have been expected for some time. Although US regulators produced draft NSFR rules in 2016, the market has still been in…

Behind the uptick in Jan 31 2019 US repo rates (Premium)

February 4, 2019

Repo, SOFR, Tri-Party Repo, US

Canadian banks, Repo, topstory, tri-party, US

Some market participants were surprised while others saw it coming, but all the same, US repo rates saw a sharp uptick on Thursday Jan 31. According to dealers, at one…

Pirum extends North American offering with US Domestic Tri-party connectivity

January 29, 2019

Pirum, tri-party, US

Securities Finance Automation leaders Pirum, have recently globalized their tri-party connectivity service. Building on its existing real time connectivity to the 4 international tri-party agents, it is now able to…

US repo has become a good deal for cash investors

January 29, 2019

Repo, Tri-Party Repo, US

Commercial Paper, Repo, topstory, tri-party, US

As repo rates generally track interest rate benchmarks, the steady rise in the US rate has made US repo into an attractive investment opportunity in its own right for the…

Not that dramatic: repo spikes in Europe and the US were quick and understandable

January 7, 2019

Repo, SOFR

Europe, Repo, SOFR, topstory, US

End of year repo trading in both the US and Europe saw the same types of leaps in General Collateral (GC) rates backed by government collateral that we’ve seen before,…

US GCF Repo(R) rate hits 5.149% on last day of 2018; tri-party and SOFR up

January 2, 2019

GCF Repo, US

The US GCF Repo(R) market hit an astounding 5.149% for UST on December 31, 2018, up from 2.551% just the day before. We heard a high point of 6.125% in…

Finadium: US Repo Market at End of 2018

December 12, 2018

Repo, US

Finadium, Repo, topstory, US