Regulators are encouraging investment managers to facilitate more private investment in a wider range of assets to help fund small businesses and infrastructure projects. New securities markets are opening up in places like China, the Middle East, and Latin America. Meanwhile, the European Union is pursuing a "Capital Markets Union" initiative to develop capital and securities markets further. The goal is to attract more investment and open up alternative funding sources beyond banks.
The past couple of decades have seen a significant shift from active to passive investment strategies. We examine how this shift affects financial stability through its impacts on:
(i) funds’ liquidity and redemption risks,
(ii) asset-market volatility,
(iii) asset-management industry concentration, and
(iv) comovement of asset returns and liquidity.
Overall, the shift appears to be increasing some risks and reducing others. Some passive strategies amplify market volatility, and the shift has increased industry concentration, but it has diminished some liquidity and redemption risks. Finally, evidence is mixed on the links between indexing and comovement of asset returns and liquidity
The paper opens with an overview of the
commodity trading advisor (CTA) sector, highlighting the
significant growth that has taken place in the managed
futures industry in recent years and explaining how
the managed futures strategies that CTAs employ
work in practice. The breadth of sub-strategies under
the managed futures umbrella are then examined.
The third part of the paper examines the benefits and
perceived risks to investors of allocating to managed
futures strategies and also addresses various common
misunderstandings about CTAs.
The paper concludes by exploring the common ways
as to how investors can access the various investment
strategies that are available
WE BELIEVE that our Eighth Core Portfolio investment strategy provides the answers to the previously mentioned issues and offers a truly balanced approach to investing.
Equities, bonds, real estate and commodities are four asset classes that cover the core of any asset allocation process. The Eighth Core Portfolio is based on the idea that, during any given stage of a global investment cycle, money will flow across these assets, thereby affecting their performance. Rather than time the entry into the outperformer and the exit from the underperformer the Eighth Core Portfolio invests globally across all four in equal measure thereby ensuring that it participates in the best asset class in any environment. Over the investment period a constant exposure is maintained in order to avoid any outperforming asset class becoming a drag when the market turns.
This balanced approach is designed to produce medium to long term returns which exceed those of nominal cash returns. Historical evidence shows that this strategy has had proven outperformance in various timeframes and in all environments (see Tables 1 to 3) More importantly it minimizes volatility by taking advantage of the low correlations between the individual asset classes (see Table 4).
The past couple of decades have seen a significant shift from active to passive investment strategies. We examine how this shift affects financial stability through its impacts on:
(i) funds’ liquidity and redemption risks,
(ii) asset-market volatility,
(iii) asset-management industry concentration, and
(iv) comovement of asset returns and liquidity.
Overall, the shift appears to be increasing some risks and reducing others. Some passive strategies amplify market volatility, and the shift has increased industry concentration, but it has diminished some liquidity and redemption risks. Finally, evidence is mixed on the links between indexing and comovement of asset returns and liquidity
The paper opens with an overview of the
commodity trading advisor (CTA) sector, highlighting the
significant growth that has taken place in the managed
futures industry in recent years and explaining how
the managed futures strategies that CTAs employ
work in practice. The breadth of sub-strategies under
the managed futures umbrella are then examined.
The third part of the paper examines the benefits and
perceived risks to investors of allocating to managed
futures strategies and also addresses various common
misunderstandings about CTAs.
The paper concludes by exploring the common ways
as to how investors can access the various investment
strategies that are available
WE BELIEVE that our Eighth Core Portfolio investment strategy provides the answers to the previously mentioned issues and offers a truly balanced approach to investing.
Equities, bonds, real estate and commodities are four asset classes that cover the core of any asset allocation process. The Eighth Core Portfolio is based on the idea that, during any given stage of a global investment cycle, money will flow across these assets, thereby affecting their performance. Rather than time the entry into the outperformer and the exit from the underperformer the Eighth Core Portfolio invests globally across all four in equal measure thereby ensuring that it participates in the best asset class in any environment. Over the investment period a constant exposure is maintained in order to avoid any outperforming asset class becoming a drag when the market turns.
This balanced approach is designed to produce medium to long term returns which exceed those of nominal cash returns. Historical evidence shows that this strategy has had proven outperformance in various timeframes and in all environments (see Tables 1 to 3) More importantly it minimizes volatility by taking advantage of the low correlations between the individual asset classes (see Table 4).
It is a market place where shares of public companies are bought and sold
It is commonplace where the issuers of the shares & subscribers of the shares come together
The UK investment management industry is at a turning point. Traditional active managers have already had to adapt to changes in the institutional market, but now they face a confluence of trends – from regulation to pension auto-enrolment to the growth of passive investing – that could radically reshape the retail side of their industry as well.
Changes to Basel Regulation Post 2008 CrisisIshan Jain
Subprime crisis
Basel Committee objectives and history
Pillars of Basel 2 and Basel 3
Basel 3 Capital Requirements
capital Rations
Capital Buffers
Leverage Ratios
Global Liquidity Standards
macroeconomic factors
Value at Risk
Expected Shortfall
Mercer Capital | Valuation Insight | Capital Structure in 30 MinutesMercer Capital
Capital structure decisions have long-term consequences for shareholders. Directors evaluate capital structure with an eye toward identifying the financing mix that minimizes the weighted average cost of capital. This decision is complicated by the iterative nature of capital costs: the financing mix influences the cost of the different financing sources. While the nominal cost of debt is always less than the nominal cost of equity, the relevant consideration for directors is the marginal cost of debt and equity, which measures the impact of a given financing decision on the overall cost of capital. The purpose of this whitepaper is to equip directors and shareholders to contribute to capital structure decisions that promote the financial health and sustainability of the company.
Proactive Alternatives strategies for the sophisticated HNW investor with actively managed accounts. A currency hedge works well against rising interest rate volatility.
Financial services contribute to economic growth and development by facilitating banking, investment, savings, insurance, stock markets, debt, and equity shares.
Visit: https://m1nxt.blogspot.com/2023/11/stay-informed-latest-financial-services.html
Financial services contribute to economic growth and development by facilitating banking, investment, savings, insurance, stock markets, debt, and equity shares. These services help private entities and individuals save funds, compete in the market, and protect against risks and ambiguity. They also contribute to the GDP and promote liquidity. Financial services generate employment, reduce the cost of transactions and borrowing, and minimise asymmetric information.
Visit: https://m1nxt.blogspot.com/2023/11/stay-informed-latest-financial-services.html
It is a market place where shares of public companies are bought and sold
It is commonplace where the issuers of the shares & subscribers of the shares come together
The UK investment management industry is at a turning point. Traditional active managers have already had to adapt to changes in the institutional market, but now they face a confluence of trends – from regulation to pension auto-enrolment to the growth of passive investing – that could radically reshape the retail side of their industry as well.
Changes to Basel Regulation Post 2008 CrisisIshan Jain
Subprime crisis
Basel Committee objectives and history
Pillars of Basel 2 and Basel 3
Basel 3 Capital Requirements
capital Rations
Capital Buffers
Leverage Ratios
Global Liquidity Standards
macroeconomic factors
Value at Risk
Expected Shortfall
Mercer Capital | Valuation Insight | Capital Structure in 30 MinutesMercer Capital
Capital structure decisions have long-term consequences for shareholders. Directors evaluate capital structure with an eye toward identifying the financing mix that minimizes the weighted average cost of capital. This decision is complicated by the iterative nature of capital costs: the financing mix influences the cost of the different financing sources. While the nominal cost of debt is always less than the nominal cost of equity, the relevant consideration for directors is the marginal cost of debt and equity, which measures the impact of a given financing decision on the overall cost of capital. The purpose of this whitepaper is to equip directors and shareholders to contribute to capital structure decisions that promote the financial health and sustainability of the company.
Proactive Alternatives strategies for the sophisticated HNW investor with actively managed accounts. A currency hedge works well against rising interest rate volatility.
Financial services contribute to economic growth and development by facilitating banking, investment, savings, insurance, stock markets, debt, and equity shares.
Visit: https://m1nxt.blogspot.com/2023/11/stay-informed-latest-financial-services.html
Financial services contribute to economic growth and development by facilitating banking, investment, savings, insurance, stock markets, debt, and equity shares. These services help private entities and individuals save funds, compete in the market, and protect against risks and ambiguity. They also contribute to the GDP and promote liquidity. Financial services generate employment, reduce the cost of transactions and borrowing, and minimise asymmetric information.
Visit: https://m1nxt.blogspot.com/2023/11/stay-informed-latest-financial-services.html
Forward-Looking Practices in Wealth ManagementCognizant
To keep up with growing regulations in wealth management sector, firms need to future-proof their operations with a robust risk-control system and transparent trading practices.
The Key factor that has resulted policy issues in equity and debt of international Finance due to the “International finance liberalization”
There are certain factors that could result policy issues in equity and debt of international finances which has furnished below.
Covering the sequence and order of financial liberalisation,
Capital controls,
exchange rate policy
asymmetric information
This is a white paper authored in 2013 on behalf of Confluence Technologies, Inc. of Pittsburgh. It addresses the dynamic behind a new regulatory reporting requirement for alternative asset managers (hedge funds, etc.). Since it was produced under contract, the article byline was set to that of a Confluence employee.
Understanding ROI: The Real Impact of Data QualityNICSA
Calculating ROI on data initiatives is critical to business planning. Understanding and demonstrating the value that data initiatives can unlock requires in-depth understanding of business needs and pain points. This panel of asset managers and data professionals will investigate strategies, implementation and measurement at various firms.
The Reality Behind Buzzwords Series: BlockchainNICSA
Business execs looking for the latest update on technology issues impacting the global asset management industry are invited to join NICSA’s panel of experts as they guide participants through case studies and applications of the most buzzworthy innovations. In this ongoing webinar series, we will focus on one buzzword at a time to learn “tech speak,” fine tune the application of the term, and know what buzzwords are a reality in practical business models within the asset management industry.
Industry Leaders Outlook: Product & Marketing RoundtableNICSA
New ways of attracting and engaging investors make 2019 an exciting (and challenging) time to work in global asset management. The industry is facing rapid evolution in terms of product development and marketing trends. Our panel of industry thought leaders explores the industry’s biggest obstacles and opportunities for product differentiation and brand loyalty. Find out what product trends have traction for the long term and how product and marketing teams are working together to support these trends.
This presentation will discuss the adoption of Regulation Best Interest (Reg BI) and its effect on broker-dealers, investment advisors, and asset managers. Our panel of experts will explain the implications and will provide practical steps that industry participants can take to ensure compliance with Reg BI.
Asset managers and distributors are invited to learn the importance of developing targeted and successful strategies that increase their reach and impact among financial advisors. Join Cogent for up-to-the-minute thought leadership on advisor preferences and insightful guidance on how to strengthen partnerships.
New Challenges on the TA Compliance LandscapeNICSA
Join NICSA’s panel of experts as we discuss what it takes for transfer agents to stay compliant with GDPR regulations, elder abuse prevention best practices, and other top of mind compliance issues. Take a guided tour of the NICSA Transfer Agent Compliance Guide, an essential resource available to NICSA members for understanding and responding to industry and regulatory challenges. Subject matter experts will review what’s new for 2019 and discuss what the future may hold for the regulatory landscape.
Navigating Turbulent Changes to the Sanctions LandscapeNICSA
Recent geo-political events have made for challenging times for sanctions compliance professionals. SIX is hosting a webinar with NICSA members to explore ways to reduce operational risk by staying one step ahead of evolving economic sanctions.
Join expert Connie Lindsey, Head of Corporate Social Responsibility and Global Diversity & Inclusion at Northern Trust, as she leads a discussion around progressing talent recruitment, retention and managing to improve diversity and inclusion in the financial industry. Rethink industry hiring practices and explore how diversifying the workplace reshapes opportunity. Listen to panelist Dan Houlihan, Head of Asset Servicing for North America, and Jim Fitzpatrick, President of NICSA, as they share more information about The Diversity Project North America, an organization dedicated to a more inclusive workforce culture.
There is a sea change underway in the retirement industry. New technologies are emerging to engage participants and streamline back-office operations. All the while, the regulatory environment continues to shift with new and proposed rules.
This webinar will reveal new research on the saving habits of a new generation of investors, review the regulatory landscape, and reveal strategies that retirement plan professionals are using to streamline operations and leverage new technologies.
Key Objectives:
Our panel will take a deep dive into the trends driving the retirement industry foreword including:
Behavioral finance strategies aimed at closing the retirement savings gap
Regulatory trends such as Multiple Employer Plans and new State-sponsored Retirement plans that may present new opportunities for asset managers
How firms are using AI, blockchain, the Cloud, and data science to save money and boost productivity
Building Deeper Advisory Relationships with DataNICSA
An exploration into how asset managers are addressing today’s marketplace challenges and leveraging new tools and technologies to create more fruitful relationships with financial advisors.
The asset management industry is confronted with several challenges to growth. Increased transparency via technology, competitive fee pressure, product commoditization, regulatory change and demographic shifts are contributing to increased margin pressure. One possible solve is to deepen relationships by turning existing client data into an asset. While leveraging analytics to inform client segmentation, client journey mapping and brand enhancement is not a novel exercise in the business world, it has perhaps not been fully adopted and implemented within intermediary distributed asset management.
Will regulatory temperature rise again this year?
With regulators on both sides of the Atlantic poised to take action on multiple fronts, it is important that asset managers understand what issues are on the horizon. This webinar aims at giving you key information on new developments, regulations, and trends that we think asset managers should be tracking for the year ahead.
EU elections in May 2019: What to expect?
EU policymakers face a tight deadline to get all open legislative proposals approved ahead of the EU Parliamentary elections in May 2019. Key open issues include: updates to the UCITS and AIFMD frameworks, a proposed Environmental, Social, and Governance (ESG) framework, the creation of a Pan-European Personal Pension Product, and changes to the European Market Infrastructure Regulation.
What’s in the Pipeline?
Get the latest insight on UCITS 6, AIFMD 2, PRIIPS2, MiFID 3, as well as the latest on the regulation of digital assets from a panel of industry experts and thought leaders.
Join our panel of experts to explore surprising insights and opportunities focused on the next-generation client. This webinar will feature new research to help Asset Management firms attract and retain Next Gen clients. Join us for an in-depth look at myths and facts about how financial firms can connect with millennial investors by understanding their financial outlook, what’s important to them and how they like to communicate.
Tenured experts from Broadridge and Cogent will take a deep dive into the profile of the Affluent Millennial including:
- Product usage
- Risk tolerance
- Financial priorities
Tax & Reporting Update: Avoiding Fund Reporting TrapsNICSA
As we enter into the new year, asset managers should consider the tax legislation and reporting requirements that will affect them most drastically in 2019. Join NICSA for recap of recent and proposed legislation impacting financial reporting. Get an up-to-the-minute state of the union and hear the questions most asked by fund boards.
Professionals from State Street and EY will provide an in depth look at the tax developments and accounting standards having the biggest impact on the upcoming reporting periods.
Learning Objectives:
• Understanding of the current regulatory environment
• Overview of reporting requirements with biggest impact to asset managers
• Tax legislation and technical corrections update, including Section 199
Learn how data-driven analytics, omni-channel delivery, and blockchain are helping mutual funds achieve their proxy goals. Join us for a discussion about the rise of social media and text messaging and how to apply these digital strategies to shareholder voting and how distributed ledger technology eliminates the need for post-vote reconciliation. Participate in an active discussion on how the accuracy, transparency, and efficiency of the proxy voting and solicitation system can be improved via digital strategies.
Best Practices in Building a Global Compliance ProgramNICSA
Investment firms with an international footprint are beginning to integrate a global view on their overall compliance policies and programs. Join our panel of experts for an in-depth discussion about the challenges firms face, and the efficiencies they can gain, by creating and maintaining a global compliance program. What does the interaction across jurisdictions look like? How do firms coordinate across borders? Hear a panel of asset managers and financial service providers dissect the best practices and overall impact of globalizing risk and compliance programs.
Learn more about leveraging AI within your organization! AI has the promise of driving operational efficiencies, enhancing compliance and informing investment decisions. Join our candid discussion with some of today’s leading experts on where the dollars are going, which trends are being successfully implemented, and which technologies promise to shape the next decade within the global asset management industry. Hear asset management case studies in and get an insider’s “reality check” on all things AI.
Rule 30e-3: Best Practices for Notice, Access & E-DeliveryNICSA
Join our panel of experts to explore the key aspects and required action items related to the 30e-3 ruling. This webinar will take a deep dive into the impact on multiple facets of the industry and will provide insight from diverse perspectives regarding implementation and execution strategies.
Tenured experts from Invesco, MFS, Morgan Stanley and Broadridge will take a deep dive into the following issues:
- What are the implications for fund complexes, broker dealers, and investors?
- What preparatory actions are asset managers taking now?
- What are BDs doing to prepare?
- What solutions are you considering?
- Will it change the client experience?
How are product development processes within the asset management industry evolving to support innovation? NICSA’s panel of experts explores how product teams are vetting and nurturing ideas, what factors are considered in vehicle structure decisions, and the operational aspects involved in launching new products. Participants will come away with actionable steps and key trends based on recent studies and reports from Ignites Research.
The Bottom Line: Exploring the Benefits of Wellness in the WorkplaceNICSA
Financial services firms continue to re-imagine their business models. As our industry re-defines the workplaces of the future, more firms are implementing and scaling workplace wellness programs. Research shows we cannot deny the positive impact of these programs from reduced health care costs to increased productivity. Forward thinking firms are viewing the employee value proposition through a broader lens and this lens includes multi-dimensional wellness programs. In this webinar, we'll share diverse points of view on the value of wellness programs, how to get started, and ideas for developing impactful and rewarding programs.
Join NICSA and a panel of wellness leaders in asset management as they explore and share:
• Examples of wellness programs and emerging trends (what’s next in the evolution of wellness programs).
• The business benefits and implications of workplace wellness programs – talent acquisition and retention, increased productivity, decreased stress and health care costs.
• Ideas on getting started – corporate and grassroots programs
Data Analytics 301: Converting Analysis into Business StrategyNICSA
You’ve identified, sourced, and analyzed your most valuable data. Now what?
During our Data Analytics Webinar Series, we’ve discussed the basics of kick-starting data tools, as well as the application of advanced modeling techniques. Now, learn from leading financial institutions how to turn analytics into actionable business strategies.
This webinar will discuss how to build the right dashboards for specific business lines, and how to put those dashboard to work. Hear current use cases demonstrating how asset managers are leveraging transactional, demographic and marketing data into action items for sales and distribution teams.
Join our live webinar to hear notable experts offer invaluable insight on:
- Building dashboards for sales and distribution teams
- Converting analytics to actionable business goals
- Developing a cohesive data-based business strategy
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What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
2. 2
Executive summary
Under the spotlight
The potential designation of
the largest investment
managers and funds as
‘systemically important’ now
seems less likely, but
investment managers and
funds of all sizes are under
closer scrutiny.
Culture, conduct and
conflicts
Regulators are intent on
improving the culture of
investment management
firms.
Incentivising private
investment and
long-term savings
Investment managers are
being called on to facilitate
capital flows into different
types of assets.
The need for increased
Supervision increasing
Data demands increasing Cyber risk increasing
Non-bank GSIFIs
Shadow banking
Regionalisation and
market fragmentation
Greater investment
and savings
Financing economic
growth
Cross border
passports
retirement savings remains at the
forefront of policymakers’ minds.
However, the result will be even
greater assets under management,
creating further tension with
regulatory debate over systemic
risk.
Distribution remains in flux
Some distribution barriers are
falling, but others are rising.
Meanwhile, many previously
acceptable distribution practices
are now unacceptable, and
regulators are pushing for greater
and better transparency of costs
and charges.
Step-change in reporting
Firms can master their increasing
data needs by building a long-term
data architecture strategy.
Cyber risk enters the
mainstream
As the extent of cyber risk becomes
increasingly clear, regulators and
supervisors across the globe are
responding. Company boards
should be asking key questions
about the firm’s cyber security
policy and capability.
3. Investment management under
the spotlight
Key points
• The potential designation of the largest investment managers and funds as ‘systemically
important’ now seems less likely
• But investment managers and funds of all sizes are under scrutiny
• Stable and orderly markets remain a regulatory priority, along with investment managers’
conduct within them
• Supervisors around the globe are taking a more proactive approach
4. 4
Investment management under the spotlight
Debate over investment management and systemic risk has
moved centre stage
Policymakers and regulators are now increasingly turning their attention to the investment
management industry…
Investment managers and funds of all sizes are under scrutiny
• The International Monetary Fund (IMF), the Bank for International
Settlements, the Financial Stability Board (FSB), IOSCO1 and the U.S.
Financial Stability Oversight Council have all reacted to the large increase
in assets managed by investment managers, and to concerns that this
could lead to big outflows from one or more asset classes in the case of
market crisis.
• An IMF report two in April 2015 urged authorities to press ahead with
reforms of the investment industry.
• IMF’s latest Global Financial Stability Report (GFSR)3 includes an entire
chapter on asset management and financial stability.
IOSCO announced on 17 June 2015, at its
40th Annual Conference, that it has
concluded that a full review of asset
management activities and products in
the broader global financial context
should be the immediate focus of
international efforts to identify potential
systemic risks and vulnerabilities. This
review will take precedence over further
work on methodologies for the
identification of systemically important
asset management entities. After the
review is completed, work on
methodologies for the identification of
such entities will be reassessed.
Breaking news
5. 5
Investment management under the spotlight
Approaches to money market funds
The U.S. and Europe take different approaches on money market
funds
In the U.S., money market funds (MMFs), once seen as vanilla
investments, have become a focus for efforts to reduce systemic
risk. Some invested in highly volatile investments, leading funds to
“break the buck” and investors to suffer large losses in 2008 – 09.
The SEC’s aim is to reduce the risk of investor runs on MMFs in
times of financial crisis.
Europe has grappled with the same issue and come up with a
different solution, in part because the features of EU MMFs and
their investor bases are a little different. Also, while the U.S. has
amended its accounting rules (and therefore the tax implications
for investors) in tandem with the regulatory changes, in the EU
accounting and tax rules are largely a matter for national
governments. The European Commission’s proposal for a
Regulation of MMFs covers both institutional and retail funds and
contains a number of provisions, such as prescription on eligible
assets, diversification requirements, liquidity ladder, disclosures to
investors, a documented internal assessment procedure and stress
testing.
Latest European proposal
Public debt CNAVs
Must be 99.5 percent invested in public debt and by 2020 must be
80 percent invested in EU debt.
Retail CNAVs
Available to charities, non-profit organisations, public authorities
and public foundations.
LV (low volatility) NAVs
The NAV may be rounded up or down by two decimal places in
order to keep it constant. However, if the NAV deviates by more
than 20 basis points from the rounded constant NAV, the fund
must stop rounding and publish the actual NAV.
6. 6
Investment management under the spotlight
Orderly markets and good conduct remain a priority
Markets in Financial Instruments
Directive (MiFID II), and its sister
regulation MiFIR are giving European
investment and fund manager a
considerable challenge
The impact of the Directive – which must
be enshrined in national laws in 2016 and
which comes into effect in January 2017
impacts nearly every function and
department in a firm.
In particular, MiFID II introduces
fundamental changes to the structure of
the wholesale markets that will impact
investment managers as users of those
markets on behalf of their clients.
The many parts of MifId II/MifIR
Source: ‘MiFID II Bites: Best Execution,’
KPMG International 2015
7. 7
Investment management under the spotlight
Supervisors are taking a more active approach
Supervisors of the investment management and funds sector around the globe are
increasingly active. This activity is not confined to jurisdictions where rules are
changing.
Bahrain the regulators are checking how well firms
have bedded down rules introduced in 2012.
The Financial Services Authority (FSA) in Hong Kong is
asking more detailed questions about internal
processes.
In the U.K., the FCA is increasingly requiring chief
executives formally to attest that their firms are fully
compliant with particular rules, in addition to
continuing to undertake thematic reviews of the
industry.
Within Europe, ESMA has been increasingly active, not
only in commenting on the practices of the industry
but also with regard to the approaches of the national
regulators.
8. Culture, conduct and conflicts:
Regulators seek tangible change
Key points
• Regulators are intent on improving investment management culture
• But the focus of different national and regional regulators varies, as does understanding of the
words ‘culture’ and ‘conduct’ in a regulatory context
• Firms are increasingly being required to oversee and actively monitor their counterparties,
service providers and distributors
• They must also focus on internal governance and the security of clients’ assets
• A spotlight is shining on investment Management remuneration and value for money
9. 9
Culture, conduct and conflicts: Regulators seek tangible change
Real cultural change, not box-ticking
Regulators are intent on improving
investment management culture, associating
good culture with better outcomes for
consumers.
The overriding priority of regulators is that
businesses should always put the interests of
consumers first.
They require strong internal governance, the
reduction of conflicts of interest and good
conduct in dealings with consumers,
intermediaries and market counterparties.
MiFID II addresses a number of business
conduct issues, including (in no particular
order):
• The distribution of funds, structured
products and securities
• Inducements
• Disclosure of costs and charges
• Internal governance and controls
• Product governance
• Product complexity (which products can
be sold execution-only and which cannot)
• Best execution
Investment/fund
manager
Fund investors
One area of the expected
detailed rules
underpinning MiFID II that
is causing particular
concern is the need for
European Investment
managers to review the
way in which they pay for
investment research.
10. 10
Culture, conduct and conflicts: Regulators seek tangible change
Conduct measures focus on consumer protection
The G20 and OECD are leading the way at a global level.
The Task Force on Financial Consumer Protection 8,
endorsed by the G20 in 2012, has more recently developed
a second set of Effective Approaches, dealing with six of the
10 High-Level Principles on Financial Consumer Protection:
• Legal, Regulatory and Supervisory Framework
• Role of Oversight Bodies
• Equitable and Fair Treatment of Consumers
• Disclosure and Transparency
• Financial Education and Awareness
• Responsible Business Conduct of Financial Services
Providers and Authorised Agents
• Protection of Consumer Assets against Fraud and
Misuse
• Protection of Consumer Data and Privacy
• Complaints Handling and Redress
• Competition
11. 11
Culture, conduct and conflicts: Regulators seek tangible change
A spotlight on investment management remuneration
The link between pay and conduct is firmly established in the minds of regulators, nowhere more so than in Europe.
• MiFID II focuses on conflicts of interest
associated with sales practices. From
January 2017, all investment firms need
to ensure that staff remuneration
incentives do not encourage
inappropriate sales practices.
• The requirements on remuneration in the
Alternative Investment Fund Managers
Directive (AIFMD) focus on financial
stability and risk management.
Alternative Investment Funds (AIFs)
should have remuneration policies and
practices that promote sound and
effective risk management and do not
encourage risk-taking that is inconsistent
with the risk profiles, rules or instruments
of incorporation of the AIFs they manage.
• AIFMD requires that the fixed and
variable components of remuneration
should be appropriately balanced to avoid
excessive risk-taking.
• As with the AIFMD, UCITS management
companies are required to establish and
maintain remuneration policies and
practices that are consistent Under UCITS
V10, fixed and variable remuneration
should also be appropriately balanced.
Early drafts of UCITS V included a 1:1
bonus cap and prescriptive measures on
the charging of performance fees.
• The fourth Capital Requirements Directive
(CRD IV), meanwhile, provides for a basic
ratio of fixed and variable elements of
1:1, which can be increased to 1:2 with
shareholder approval.
12. 12
MiFID II brings in for the first time detailed product
governance requirements for firms that
manufacture or distribute funds or structured
products.
Manufacturers must ensure that:
• Products meet the needs of identified target
market of end-clients.
• Their distribution strategy is compatible with
that target market.
They take reasonable steps to ensure that products
are distributed to the target market.
Managers must periodically review the
identification of the target market and performance
of the product.
All UCITS and AIF managers, even if not directly
subject to MiFID, will also have to review their
product governance processes because the
distributors.
Culture, conduct and conflicts: Regulators seek tangible change
New focus on product governance
13. 13
Culture, conduct and conflicts: Regulators seek tangible change
Costs and charges under review
Regulators, particularly in Europe, are asking why costs have not fallen as a proportion of assets managed, despite large
rises in assets under management.
Under both MiFID II and the Regulation introducing a Key Information Document for Packaged Retail Investment and
Insurance-based Products (the PRIIP KID), fund managers will be expected to disclose more detailed information relating
to underlying costs and charges in the fund, over and above the requirements of the existing UCITS KIID. However,
financial advisers say that while the industry should be applauded for improving transparency around costs and charges,
the level of detail being called for is unnecessary. There is a risk of “information overload” with too many figures being
provided to investors, they argue.
The issue of costs and charges has brought into focus the
added valued created by investment managers. Luxembourg
and Sweden, for instance are casting a critical eye over
active funds that are, in fact, closet index trackers but charge
higher fees. Meanwhile, the Danish regulator found that
almost a third of the 188 domestic equity funds in Denmark
could be classified as closet trackers. ESMA subsequently
decided in early 2015 to gather more information on the
issue before deciding whether to take action.
Similar preoccupations can be found in a number of
jurisdictions where pension fund charges are under the
microscope. Some policy makers are questioning the level of
fees paid to investment managers and are seeking greater
disclosures.
14. 14
Culture, conduct and conflicts: Regulators seek tangible change
Onus on looking after clients’ assets
European regulators have gone to great lengths to make sure asset management clients do not suffer losses as a result of fraudulent or
careless behavior.
EMIR, which tackles segregation and, re-hypothecation of assets, is a leading example of this preoccupation. Broadly, under EMIR, clearing
brokers must offer individual segregated accounts in which individual client assets are isolated, or omnibus segregated accounts in which
client assets can be commingled with those of other clients.
Under the incoming Central Securities Depositary Regulation (CSDR), a new settlement discipline regime will come into force whereby
failed trades will face a mandatory buy-in, and CSDs would have to buy back an asset at the prevailing market price and deliver it to the
non-defaulting counterparty.
Jurisdictions that have become financial centers for international domiciliation and distribution of investment vehicles, such as Luxembourg
and Ireland, are pushing ahead with fund and client asset rules in order to enhance their credibility and brands.
Under UCITS V, fund managers will
have to evidence strong governance
and operational separation between
the depositary and the manager if
they are in the same financial group.
15. Policymakers incentivise private
investment
Key points
• Many countries, particularly in the West, are encouraging more private investment to fill the
gap in bank funding of fledgling enterprises, and public funding of physical and social
infrastructure
• New securities markets are opening up and new financing structures and fund products are
being introduced
• The investment management sector is being urged by many governments and policy makers
to facilitate private investment in a wider range of markets and asset types
• But many regulators remain cautious about the extent to which ordinary citizens with modest
savings should invest in such asset classes
• Responsible stewardship of equity investments in listed companies remains on the agenda
16. 16
Policymakers incentivise private
investment
The need for more private investment to fund fledgling
enterprises and physical and social infrastructure is exacerbated
by the regulatory demands on banks to strengthen their balance
sheets, which has led many significantly to reduce their lending
activity.
The result is the recent opening up of new securities markets and
financing structures and a green light by policymakers to
introduce new fund products.
Meanwhile, many emerging countries are seeking to boost inward
investment and to encourage individual wealth to be invested
domestically, in order to strengthen their internal capital markets
and economies.
17. 17
Policymakers incentivise private investment
Flowering of securities markets
Shanghai-Hong Kong stock connect
Provides investment managers in both Hong
Kong and China more room for creativity in
product development, opportunities for
arbitrage trading and flexibility in product
development.
Middle Eastern and Latin American markets
open up
United Arab Emirates (UAE) is in the process of
setting up the Abu Dhabi Global Market (ADGM)
to attract foreign institutions and investors, Abu
Dhabi’s government has said that ADGM will be
governed by a recently-created independent
regulator, the Financial Services Regulations
Bureau, and that rules and regulations will be
aligned with international best practice
standards recognised in other international
financial centres.
Brazil has relaxed rules for local funds that invest internationally in a move that could
open up new opportunities for UCITS managers.
Under new rules, Brazilian funds offered to retail investors will be able to invest up to
one-fifth of their assets overseas, up from 10 percent. Qualified investors, with
BRL1 million (EUR 289,000) of investable assets, will be able to invest in funds that may
allocate up to 40 percent of their portfolios in foreign assets. Professional investors,
with a minimum BRL10 million of investable assets, will for the first time have access to
funds entirely invested in foreign assets.
18. 18
Both within the EU and among the ranks of the G20, the agenda is increasingly focusing on growth.
• Japan introduced a new trading system for unlisted shares and has reduced the administrative burden for newly-listed companies.
• Europe – ‘Capital Markets Union’ (CMU) is the over-arching banner within Europe, with momentum growing behind building capital and
securities markets.
CMU – European Commission Green Paper, 18 February 2015
Policymakers incentivise private investment
Facilitating greater investment flows in already open
markets
Focus on funding for SMEs and infrastructure, on attracting more investment into the EU and opening up a wider range of funding
sources.
Develop proposals to
encourage high
quality securitisation
and free up bank
balance sheets to
lend.
Review the
Prospectus Directive
to make it easier for
(smaller) firms to
raise funding and
reach investors cross
border.
Improve the
availability of credit
information on SMEs
so it is easier to
invest in them.
Work with the
industry to put in
place a
pan-European
private placement
regime to
encourage direct
investment into
smaller businesses.
Support the take-up
of European
Long-term
Investment Funds
(ELTIFs) to channel
investment in
infrastructure and
other
long-term
projects.
1 2 3 4 5
Source: KPMG International 2015
19. 19
Crowdfunding: a revolution taking place in the financing of small companies is being supported by many countries. But its very success
and rapid expansion is starting to attract more critical regulatory focus.
• The U.K. FCA is starting to intervene in the marketing of equity crowdfunding, peer-to-peer lending and mini-bonds, after it found a series of problems
in how providers communicate what they offer.
• In the U.S., the Jobs Act, is supporting crowdfunding. The new law is helping to simplify rules that govern U.S. capital-raisings and securities sales and
will allow equity and debt.
• In Japan, crowdfunding is seen as another way to revitalise growth.
Promoting the use of equity crowdfunding
Policymakers incentivise private investment
Growth of crowdfunding attracts rule-makers’ scrutiny
Source: KPMG International 2015
12
Financial Times, 23 February 2015
START-UP
ENTERPRISES
PLATFORM
OPERATORS
INVESTORS
20. Governments incentivise long-term
savings
Key points
• The need for increased retirement savings remains at the forefront of policymakers’ minds
• There is a raft of changes to existing pension regulation and the introduction of new pensions
products and tax-free savings accounts
• The investment and fund management industry will benefit from more assets to manage and
opportunities to launch new fund-based retirement products
• It contrasts with the debate about investment management and systemic risk, in which large
increases in assets under management are causing policymakers concern
21. 21
Governments incentivise long-term savings
Retirement and pensions
As a result of this opposition, the Commission published a
new draft of the IORPD in March 2014.
The plan includes:
• Detailed governance requirements on risk management,
outsourcing and internal audit
• Scheme administrators would be required to have professional
qualifications
• The scheme would need a remuneration policy
• Restrictions on long-term investments would be banned
• The current requirement for cross border schemes to be fully
funded at all times is retained
• Defined contribution (DC) schemes will be required to appoint a
depository, with responsibility for safe-keeping of assets and
oversight
• The detailed prescription for the mandatory, EU-harmonized
Pension Benefit Statement, to be sent at least annually to every
scheme member, will cover everything from total capital expressed
as an annuity per month (for DC schemes), to risk profiles of
investment options, to a breakdown of costs and charges
• Member States will be required to bring the new Directive into
force by December 2016
The new draft of IORPD expands and
transforms the Directive with extensive new
governance requirements and a detailed plan
for a harmonized EU-wide format for member
benefit statements.
22. Some barriers to fund distribution
are falling, but others are rising
Key points
• New fund passports are lowering cross-border barriers within regions, but raising them for
foreign managers in those markets
• Many previously acceptable distribution practices are now unacceptable, although regulators
are adopting a variety of approaches
• Regulators are unrelenting in the drive for greater and better transparency of costs and
charges
• The complexity of products sold in retail markets is under scrutiny, with ‘suitability’ as a
particular focus
• Technological opportunities to develop digital distribution channels are at odds with
regulatory moves to restrict execution-only distribution
23. 23
Some barriers to fund distribution are falling, but others are rising
Easing funds’ access to markets
Types of recognised funds – Qualified funds will be
authorised in accordance with mainland or Hong
Kong laws and regulations, initially covering simple
fund products. The types of products may be
expanded.
ELIGIBILITY OF MANAGEMENT FIRMS – Firms can be
registered in the mainland or Hong Kong and must be licensed
by the CSRC/HKSFC.
APPROVAL/VETTING PROCESS OF FUNDS – Funds will be
subject to a streamlined vetting process by the host regulator.
FUND OPERATIONS – Requirements relating to investment
restrictions, dealing, valuation, audit and meetings must
comply with the laws and regulations of the home jurisdiction.
5. Disclosure of information – The host regulator may demand
supplementary information on content, format and frequency
of update of offering documents.
INVESTOR PROTECTION – The HKSFC and the CSRC will
strengthen regulatory co-operation and assistance and clearly
specify dispute resolution mechanisms.
The HKSFC and CSRC announcement in
May 2015 took the market by surprise,
but there are already some shifts in
the fund domicile landscape.
24. 24
Some barriers to fund distribution are falling, but others are rising
Regional passporting
The implications of the regional passports
UCITS
A trend away from UCITS as the dominant force in Singapore, Hong Kong and other Asian
countries
Capital markets
Funds passporting can recycle savings locally and deepen Asia’s capital markets
Local investment managers
The opportunity to sell a product in more than one market of the region and the
potential to develop more sophisticated products with a higher ceiling on AUM growth
Framework jurisdictions
Propel the growth of an end-to-end asset management industry
Investors
Diversification of investments, greater product and investor choice, and potentially more
competitive manager fees
Global investment managers
Through a single regional office have access to a huge retail investor base and more
straightforward marketing process, creating economies of scale
Source: KPMG International 2015
Other potential boosts to the
industry come in the shape of the
APEC Asia Region Funds Passport
(ARFP) and the ASEAN Collective
Investment Scheme Framework.
25. 25
Some barriers to fund distribution are falling, but others are rising
Incentivising distribution: What was acceptable is now
unacceptable
Many territories are moving towards regulation that seeks
to ensure distributors act in the best interests of the
end-customer
• In Europe, this move started with the U.K.’s Retail Distribution
Review (RDR) and the cudgel has been taken up by MiFID II.
• RDR is spreading more widely, with versions of it already created in
India and Australia.
• Canada has taken a different approach and introduced an explicit
best interest rule for dealers and advisers;
– Some countries have focused on mandatory qualifications for financial
advisers.
• In South Africa, RDR has been initiated by the FSB after it expressed
concern that customers are still, despite previous regulation, being
sold products that are not appropriate for their needs.
• In Canada, the three-year phase-in of the cost and performance
reporting regime put in place by the CSA has begun, which will make
more explicit the actual cost of investment advice and asset
management services paid by clients.
• The Brazilian regulator requires the distributor to inform its clients of
its total remuneration. Also, it has prohibited the rebating of
administration fees by funds in which funds of funds are invested.
Distribution: A regulatory pick ‘n mix
Source: KPMG International 2015
Monetary
inducements
Funds only
Focusofnew
rules
Typesof
distributors
Product
scope
Funds &
banking
products
Funds & banking
products &
insurance-based
investments
Banned Restricted Disclosure
Approachto
inducements
More
capital
Qualifications
Non-monetary
benefits/
hospitality
Independent
advisers
Wealth
managers
Tied advisers
Broker
dealers
Platforms
26. Data: Regulation demands
step-change in reporting
Key points
• The regulatory data challenge for investment firms is significant and growing
• The emphasis on reporting may warrant firms building data warehouses and requires major
project management effort to source data
• Most firms are dealing unilaterally with the data challenge; in only a small number of
countries is the industry acting collectively
• Firms can master their data needs by building a long-term data architecture strategy, to move
from incremental cost to embedded value
• Once companies establish better data architecture and more mature analytics, they can shape
answers to business-critical questions
27. 27
Data: Regulation demands step-change in reporting
standards move closer
Moving towards integrated reporting One day, common and consistent reporting standards may ease
some of the administrative burden for investment firms. But
while these standards are evolving, related data tasks are
complex and time-consuming.
The Organisation for Economic Cooperation and Development
(OECD) proposed a Common Reporting Standard (CRS) for the
Automatic Exchange of Information (AEOI) that will see a
significant increase in customer due diligence and reporting
obligations.
The CRS will be effective from January 2016 for more than 50
‘early adopter’ countries. Financial institutions based in a country
that adopts the CRS will have to implement new requirements on
customer on-boarding, pre-existing customer due diligence,
entity and product classification, governance and reporting.
Source: ‘Automatic Exchange of Information – The common reporting standard,’
KPMG International 2014
Report Submission
28. 28
Data: Regulation demands step-change in reporting
Responding to MiFID II
MiFID II: Nowhere to hide
The MiFID II reporting requirements are numerous and one aspect of the Directive has the potential to create duplication with another. All areas of firms will be
impacted by MiFID II – front and back offices, operations and IT, compliance.
Firms are challenged by overlapping reporting requirements
Dodd-Frank
MiFID
MiFID
REMIT
EMIR
FX derivatives
IR derivatives
Commodities
derivatives
FX
IR
Commodities
Derivatives
Wholesale energy
derivatives
Wholesale energy
Equity derivatives
Fixed income derivatives
Cash equities
Fixed income
Transaction reporting volumes are expected to Surge
From 14 million daily
to 22.5 – 50 million in
the U.K. alone
Source: KPMGInternational 2015
29. 29
Data: Regulation demands step-change in reporting
Intelligent use of data can give firms a cutting edge
The best way for investment management firms to master their data needs is to build a long-term data architecture strategy, based on an optimized data supply chain that will keep pace with the rate of change.
There are plenty of improvements a company can take to improve its analytics and reporting while building out a data plan.
Analytic maturity curve
Degree of intelligence/complexity
Competitiveadvantage/value
Data centralisation
and reporting
Actionable insight Pre-emptive knowledge Holistic, real-time analytics
• Data-driven
discovery of
segments provides
new lenses into
business
• Introduce geographic and
demographic
perspectives on existing
business measures
Segmentation
• Modeling how multiple
business measures
interact to identify future
focus points
• Auto updating model
predictions with new data
ensures early detection
and fast action on
high-risk/
opportunity areas
Predictive modeling
• Enterprise data is
optimised in a data
environment, enabling fast
access to the right data by
all users for any form of
analysis, modeling or
reporting
• Leverage power of system
for fast production of
analytical output
• Integrate ‘pulse of
organization’
through linkage of
all data sources
Optimise data
environment
Insight visualisation
and distribution
• Visual pattern and
anomaly identification
over multiple
dimensions
• Interactive drill down/slice
and dice of key KPIs
• Distribution to staff
facilitates
• Action planning and
ongoing monitoring
• Bringing key data
sources together
• Monitoring known key
performance
indicators (KPls) one
at a time
• Drill down queries
• Transaction reporting
Foundation blocks
Source: KPMG International 2015
30. Cyber risk enters the mainstream
Key points
• Cyber risk has risen rapidly up the regulatory agenda
• Cyber-breaches are pervasive and sophisticated, and groups of cyber-criminals are already
explicitly targeting the investment management industry
• As the nature and extent of cyber risk become increasingly clear, regulators and supervisors
across the globe are responding
• Firms and their company boards should be asking themselves key questions about their cyber
security policy and capability…
31. 31
Cyber risk enters the mainstream
Risks are proliferating
What are we trying to prevent? Groups of cyber-criminals are already explicitly
targeting the investment industry. Cyber risk for
investment firms can range from fraud to stolen
intellectual property, such as investment
strategies and trading platform algorithms, data
relating to ultra-high-net-worth individuals,
investments or finances.
Source: KPMG International 2015
Cyber risk for investment firms can
range from fraud to stolen intellectual
property, such as investment
strategies and trading platform
algorithms, data relating to ultrahigh
– net-worth individuals, investments
or finances.
32. 32
Cyber risk enters the mainstream
The regulatory landscape
NIST five framework core functions
n I sT five framework core
functions
Identify– Develop the organizational understanding to
manage cybersecurity risktosystems, assets, data, and
capabilities.
Protect– Develop and implement the appropriate
safeguards to ensure delivery of critical
infrastructure services.
Detect – Develop and implement the appropriate
activities to identify the occurrence of a
cybersecurity event.
Respond– Develop and implement the appropriate
activities to take action regarding a detected
cybersecurity event.
Recover – Develop and implement the appropriate
activities to maintain plans for resilience and to
restore any capabilities or services that were
impaired due to a cybersecurity event.
Regulators are stepping up to the emerging
challenge
The U.S. National Institute of Standards and Technology
(‘NIST’) issued a Cybersecurity Framework 19, a set of
voluntary standards designed for critical infrastructure
companies to use in developing a comprehensive
cybersecurity program.
33. 33
Cyber risk enters the mainstream
The regulatory landscape (continued)
Worldwide regulatory focus on cyber
ASIC runs Cyber Resilience Health
Check Demands ASIC regulated entities
to have in place cyber-risk
managementpractices.Consideringa
self-assessmenttool
Data protectionregulation
Cyber security directive
Choice of regulatoryauthority
Concerns over systemicrisk
Criticalinfrastructureprotection
Disclosure requirements
No cross-partisanconsensus State
regulation– New York
Systemicrisk
Independent penetrationtesting
Communityresponse
Cross-industry exercises
NESA – supervisor for cyber security
Monitors implementationof cyber
security strategiesAudits
government-ownedentities; with
pledge to visit banks
Source: KPMG International 2015
34. 34
Cyber security capability model
Cyber risk enters the mainstream
How investment managers are responding
Risk management Compliance
Portfolio, program and project management Vendor and supplier management
Planningand
Control
Understanding
Intelligence
Business strategy
and goals
Assets
Regulatory
environment
Implementation
People TechnologyProcesses
Source: KPMG International 2015
Governance
Ownership Accountability
Funding and
sponsorship
Policy
Foundations
35. 35
Cyber risk enters the mainstream
How investment managers are responding (continued)
Organisations are typically looking to create the following
capabilities:
• People: The most important component of a cyber-security
policy is that it must be understood by all employees. Security
awareness training and developing easy to understand security
policies on corporate equipment and when working remotely will
position employees as a first line of defense.
• Processes: An adaptive approach that focuses on speed and
agility in response to an attack can prevent downtime, avoid
expensive disruptive responses and maintain business
operations, while also reassuring regulators, investors and
industry partners. Ensuring security requirements are built into
key processes such as application management, change
management, user access management and patch management.
Establishing security requirements in contracts and exercising the
right to audit with third parties.
• Technology: Implementing fundamental security controls, such
as firewalls, anti-malicious software, secure configurations and
security logging and monitoring will enable firms to stay ahead of
the curve.
Key questions for firms
• Do you have the right level of
protection for your most valuable
information?
• What would the impact be on your
business if you suffered a
cyber-security breach?
• How do you know you haven’t
already suffered one?
• How are you managing your suppliers
to ensure they are not a weak point
in your security?
• How do your cyber security
capabilities compare to your peers?
36. 36
• Be transparent and act unambiguously in the interests of your customers
• Master the increasing data needs by building a data architecture strategy and
establishing mature data analytics
• Take cyber risk seriously
KPMG can help you navigate
“This should be the golden age for the investment
management industry. The industry is well-placed to support
economic growth and to help drive the real economy. The
combined forces of longevity, prosperity and demand for
savings solutions are allied with growing demand for
market-based finance. This plays to the fundamental purpose
of the industry – linking enterprises seeking funds with
helping people save and invest for the long-term in an
uncertain world”
TOM BROWN
Global Head of
Investment
Management