Clearing and Settlement Working Group Meeting, March 2013

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Clearing and Settlement Working Group Meeting, March 2013

  1. 1. What we doNetworking Media Research Advice
  2. 2. Recent Speakers Brett King, Author, Bank 2.0 and Willem Buiter, Chief Vernon Hill, Vice Chairman, Founder, Movenbank Economist for Citigroup Metro Bank (UK)Andrew Tyrie, Chairman of the Peter Ayliffe, Chief Executive Sir Win Bischoff, Chairman,Treasury Select Committee of Visa Europe Lloyds Banking Group
  3. 3. CAS-WGThe Clearing & Settlement Working Group (CAS-WG)• A WORKING GROUP• Interpretation of Regulatory Change on Clearing & Settlement Infrastructures the City (and EU/Global)• Liaison with Regulatory Authorities• Technical infrastructure focus• The MiFID Forum
  4. 4. CAS-WGSubject Groups – Market Infrastructure Subject Group Chair: Kathleen Tyson-Quah – Technology Standards Subject Group Co-Chairs: Virginie O’Shea and Graeme Austin – Regulations Subject Group Chair: Greg Caldwell
  5. 5. Agenda2:00 Introductions2:15 Updates from Regulations Subject Groups from Chair Greg Caldwell2:45 An Overview of T2S progress and general review of clearing in Europe from Ben Parker, EMEA Securities Clearing and Settlement, Securities, UBS Group Operations3:30 Break4:00 Updates from Infrastructures and Technologies Subject Groups from Chairs Kathleen Tyson-Quah and Virginie OShea4:30 Discussion of the Europe going forward in light of recent announcements regarding the Banking Union and EMIR with • Andrew Simpson, Market Structure Consultant; and • Bob Fuller, Director, Fixnetix5:15 Call to action5:30 Close
  6. 6. Regulation Subject-group Update 14 March 2013 Greg Caldwell Greg Caldwell 2013
  7. 7. Regulation Subject-groupGreg Caldwell 2013
  8. 8. Regulation Subject-groupGreg Caldwell 2013
  9. 9. Regulation Subject-groupGreg Caldwell 2013
  10. 10. Regulation Subject-groupGreg Caldwell 2013
  11. 11. Regulation Subject-groupGreg Caldwell 2013
  12. 12. Regulation Subject-groupConclusions From Last Session, 28th January — Our primary value-add is to identify opportunities for financial institutions to avoid unnecessary costs (avoid ‘digging up the road more than once’) We termed these ‘road-works issues’ or RWIs. — To do this for each regulation would mean that useful output from the subject-group would take too long — We will pilot a different approach which is to research a number of potential RWIs across the nine key regulatory initiatives — We may have to adopt at least one set of assumptions about a likely future macro environment e.g. polarisation of the market into a few large clearers and a large number of niche specialists 13 Greg Caldwell 2013
  13. 13. Regulation Subject-groupExample RWIs— Challenge for counterparties to identify what they are to each other in a relationship— Similar for threshold declarations (which affect how a counterparty is classified)— Similar for risk classification— For EMIR, UCITS firms have to agree a definition of certain key events in order to be able to establish whether thresholds have been met e.g. what constitutes a completed confirmation— Many of them will need to put in place or procure an outsourced service to report to the regulator disputes when they have met certain thresholds Greg Caldwell 2013
  14. 14. Regulation Subject-groupGreg Caldwell 2013
  15. 15. Regulation Subject-group1. Solicit a long list of 2. Filter and rank the candidate RWIs RWIs 3. Analyse the best candidates in the 4. Publish findings subject-group meetings Greg Caldwell 2013
  16. 16. Regulation Subject-groupGreg Caldwell 2013
  17. 17. Regulation Subject-groupCrowdsourcing – competition — The Financial Services Club is offering a free membership worth £500 for the 100th RWI submitted — Please submit your suggestions to kamila@fsclub.co.uk 18 Greg Caldwell 2013
  18. 18. Regulation Subject-groupCall To Action — Help me with journalist contacts — Contribute RWI ideas….. 19 Greg Caldwell 2013
  19. 19. Agenda2:00 Introductions2:15 Updates from Regulations Subject Groups from Chair Greg Caldwell2:45 An Overview of T2S progress and general review of clearing in Europe from Ben Parker, EMEA Securities Clearing and Settlement, Securities, UBS Group Operations3:30 Break4:00 Updates from Infrastructures and Technologies Subject Groups from Chairs Kathleen Tyson-Quah and Virginie OShea4:30 Discussion of the Europe going forward in light of recent announcements regarding the Banking Union and EMIR with • Andrew Simpson, Market Structure Consultant; and • Bob Fuller, Director, Fixnetix5:15 Call to action5:30 Close
  20. 20. PublicT2SBen ParkerEMEA Head of Clearing and Settlement
  21. 21. How it all began 22
  22. 22. 23
  23. 23. Benefits of T2S4 Key AreasUnbundling Flow monster/volume driven Lowest settlement pricingHarmonisation Open trades/complexity Cost saving/simplification Optimisation/qualityCollateral shortage Efficient distributionConsolidation Multiple custodians Single Custodian 24
  24. 24. Fails per Market (Monthly Average 2012)% of overall volume % 25
  25. 25. Practical Steps Understand Your Business How will T2S impact your businessCommunicate UnderstandDo your clients know about T2S? Your businessDo they know how it will impact their business? Validate Strategic Aims Communi Validate How will T2S help or hinder your cate Strategic Aims strategic aims T2SExecuteDo it now. Benefits can accrue before Assess the Market Assess theT2S goes live What product offerings are there Execute Market Now? How to connect? What is the best way to connect? Direct, via a CSD, and ICSD, Custodian 26
  26. 26. Alternatively. 27
  27. 27. Agenda2:00 Introductions2:15 Updates from Regulations Subject Groups from Chair Greg Caldwell2:45 An Overview of T2S progress and general review of clearing in Europe from Ben Parker, EMEA Securities Clearing and Settlement, Securities, UBS Group Operations3:30 Break4:00 Updates from Infrastructures and Technologies Subject Groups from Chairs Kathleen Tyson-Quah and Virginie OShea4:30 Discussion of the Europe going forward in light of recent announcements regarding the Banking Union and EMIR with • Andrew Simpson, Market Structure Consultant; and • Bob Fuller, Director, Fixnetix5:15 Call to action5:30 Close
  28. 28. CAS-WG Technology Standards Co-chair Virginie O’Shea (post-trade technology analyst at Aite Group)
  29. 29. Technology Standards Group Progress• Working on an RFI to send out to clearers, CCPs and CSDs/ICSDs – provide hub for standards and technology requirements for connectivity and interaction with key market infrastructures• Also plan to include T2S requirements as and when they are confirmed
  30. 30. Technology Standards Group Progress• Monitoring working groups in key post-trade areas – middle office trade confirmation, trade repository reporting etc• Provide a hub for discussion of this work – highlighting areas of crossover such as FIX, SWIFT, ISITC and AFME work on trade confirmation• Got a list of working groups already and outreach to others
  31. 31. Technology Standards Group Progress• Championing an update of the Investment Roadmap for Standards – originally produced in 2008 and updated with XBRL in 2010• Intent at the time was to highlight areas of crossover between standards coverage and allow coexistence under the banner of ISO 20022 – discourage more crossover in future
  32. 32. Investment Roadmap
  33. 33. Agenda2:00 Introductions2:15 Updates from Regulations Subject Groups from Chair Greg Caldwell2:45 An Overview of T2S progress and general review of clearing in Europe from Ben Parker, EMEA Securities Clearing and Settlement, Securities, UBS Group Operations3:30 Break4:00 Updates from Infrastructures and Technologies Subject Groups from Chairs Kathleen Tyson-Quah and Virginie OShea4:30 Discussion of the Europe going forward in light of recent announcements regarding the Banking Union and EMIR with • Andrew Simpson, Market Structure Consultant; and • Bob Fuller, Director, Fixnetix5:15 Call to action5:30 Close
  34. 34. Future meetings14th March 2013 18th April 2013CAS-WG Plenary Meeing “Meet Britain’s biggest fraudster”BT Auditorium Tony Sales19th March 2013 29th April 2013“The Branch: reports of my recent “Are banks just big bullies?”demise have clearly been over-stated” Jeremy Roe, CEO, Bully Banks UKKevin Blair, CEO, New Ground 14th May 20139th April 2013 “Fixing our banks – the“The future for Europe and the Euro: bank, employee and customer view”whither Europe?” Charles Middleton, CEO, Triodos Bank;Professor Grzegorz Kolodko, former Dominic Hook, Head of Finance &Deputy Prime Minister, Poland Legal, UNITE; and James Daley, Head of Personal Finance, Which? Magazine
  35. 35. Future meetings12th June 2013 17th April 2013“Social Media: Friend of Foe?” Launch of theAndrew Walker, Chief Innovation Financial Services ClubOfficer, Tweetminster Poland27th June 2013 5th June 2013Dinner: “How technology has The future of moneytransformed credit from past time to Professor Jakubreal-time” Gorka, WarsawErrol Damelin, CEO, Wonga University David Birch, Consult Hyperion

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