The European Commission has blocked the merger of London Stock Exchange Group and Deutsche Boerse, a move expected after LSEG refused to sell its stake in Italian trading venue MTS. "The divestment of MTS, a comparatively small asset compared to the parties' combined revenues and market value, would have been a clear-cut remedy," according to the commission.
UK Prime Minister Theresa May has signed a letter that officially notifies the EU of Britain's withdrawal. The letter will be hand-delivered Wednesday to European Council President Donald Tusk and signal the start of negotiations on the terms of Brexit.
US Sens. Bob Corker, a Republican, and Mark Warner, a Democrat, are working to unwind government support for mortgage-finance giants Fannie Mae and Freddie Mac. The companies are prohibited from retaining capital starting next year, increasing the likelihood they will require further government aid.
Stress testing to determine how well EU corporate pension plans would stand up under "adverse market scenarios" will be held in mid-May, said Gabriel Bernardino, chairman of the European Insurance and Occupational Pension Authority. The review will also look at the extent to which pension plans' responses to market stress spread to the broader economy, he said.
Bloomberg maintained its 33.4% market share in financial-market data in 2016; however, demand for its terminals dropped nearly 1% from 2015. The financial industry spent a record $27.5 billion on market data last year, a 3% increase from 2015, according to research by Burton-Taylor International Consulting.
Online research services are encroaching on major investment banks' dominance of the securities research industry, with online portals' share of the global market predicted to rise to 15% by 2020, from 1% at the end of last year. These changes have been prompted by Europe's revised Markets in Financial Instruments Directive, which will require banks to charge specific fees for research when it takes effect in January and will replace the current practice of bundling them into commission charges.
Banca Popolare di Vicenza's 2016 figures show a €1.9 billion loss, sparking concerns that its application for a state bailout may be deemed unviable by European Central Bank regulators because the lender's core capital has fallen below the minimum threshold of 10.25%. Rival banks Monte dei Paschi di Siena and Veneto Banca are also requesting bailout aid from the Italian government.
Which global industries stand to benefit from Brexit? With the UK potentially striking free-trade deals with the US, Australia and India as part of its exit strategy from the EU, we analyzed the exposure of industries and companies in the S&P UK BMI index to North America and Asia in order to assess potential benefit. Read more here.
Asian-Pacific stock markets were mixed Wednesday as the UK moved closer to withdrawal from the EU. Japan's Nikkei 225 edged up 0.1%; Hong Kong's Hang Seng Index and South Korea's Kospi each rose 0.2%; Australia's S&P/ASX 200 gained 0.9%; China's Shanghai Composite fell 0.4%; and India's Sensex was up 0.4%.
China's Tencent Holdings has paid $1.78 billion for a 5% equity stake in US electric carmaker Tesla, the latest deal in which a Chinese tech firm invests in a company developing electric and self-driving vehicles. Tesla's share price rose 2.7% after the transaction was made public in a US regulatory filing.
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China's central bank, along with insurance and securities regulators, is encouraging insurance companies to invest in manufacturing, saying that the low-cost, stable funding they offer is needed to upgrade and transform the industry. As long as the proper assessments are made, the investments can be structured as equity, debt or asset-backed deals, according to a statement from the central bank.
German firms anticipate that the UK's withdrawal from the EU will "seriously damage" their business with Britain, a survey by the Association of German Chambers of Commerce and Industry found. Among German companies active in the UK market, 9% are getting ready to shift their investments out of the UK, either to Germany or other EU member states, the survey found.
Americans working with financial advisers are significantly more ready for retirement than those who haven't sought help, a survey sponsored by the Million Dollar Round Table found. Among US consumers without advisers, about 50% have a retirement plan or an emergency fund, but only 19% have a long-term financial plan.
Ten Republican senators have called on Treasury Secretary Steven Mnuchin, who heads the Financial Stability Oversight Council, to review the designation of nonbanks as systemically important financial institutions. The process "lacks transparency and accountability" and unnecessarily burdens firms deemed "too big to fail," the senators say.
The IRS has issued guidance to bring excise tax on prohibited transactions by fiduciaries into conformity with the Labor Department's temporary enforcement policy for its fiduciary rule. Without the IRS guidance, financial professionals could have been hit with excise tax on transactions allowed under the Labor Department's policy.
Sharon Bowen of the Commodity Futures Trading Commission said she and acting Chairman J. Christopher Giancarlo could reach agreement and end a standoff that has prevented the commission from adopting rules for automated trading. Giancarlo has opposed a provision giving the CFTC "unchecked power" to obtain the source code used by automated traders.
The European Central Bank wants legislation enacted that would give it oversight of foreign banks and nonbank lenders doing business in the eurozone. The ECB currently directly regulates 126 of the biggest banking companies in the eurozone but not branches or nonbanks that provide financial services.
The UK's Prudential Regulation Authority introduced proposed revised guidance on what it expects from banks that seek to rely on internal-ratings-based models to determine capital requirements. In the consultation paper, the authority suggested that when establishing the probability of residential mortgage defaults, financial firms can supplement internal models with data from prior experience.
Franklin Templeton has filed with the Securities and Exchange Commission for two actively managed exchange-traded funds. The Franklin Liberty Intermediate Municipal Opportunities ETF would buy nontaxable bonds with three- to 10-year average maturities, while the Franklin Liberty Municipal Bond EFT would invest in taxable and nontaxable municipal debt with maturities of five to 15 years.
The Securities and Exchange Commission has rejected an application to list the SolidX Bitcoin Trust as an exchange-traded product on the New York Stock Exchange's Arca, having refused a similar bitcoin application earlier this month. The SEC reiterated its previous concern that the bitcoin market is not sufficiently regulated to allow the application.