Macron would support transaction tax if it makes sense | ESMA orders close scrutiny of post-Brexit relocations | Report: Brexit may lower risk in UK financial sector
July 14, 2017
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Macron would support transaction tax if it makes sense
Macron would support transaction tax if it makes sense
Macron (Robert Hradil/Getty Images)
Discussions about implementing a tax on financial transactions in certain European countries have been ongoing since 2011, but French President Emmanuel Macron said he could get behind such a levy under certain conditions. "I want an FTT that can be applied in a coherent space, makes sense and is effective," Macron said.
Reuters (7/13) 
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ESMA orders close scrutiny of post-Brexit relocations
The European Securities and Markets Authority told regulators to thoroughly vet forthcoming moves by hedge funds and other investment managers to relocate their business to the eurozone from London.
Financial Times (tiered subscription model) (7/13),  Bloomberg (7/13) 
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Report: Brexit may lower risk in UK financial sector
The UK's Office for Budget Responsibility issued a report that says Brexit could result in a lessening of financial risk, as the size and concentration of entities in London would diminish, while stronger trade barriers between Britain and the EU would curb a spread of volatility. However, the report also points out that there may be significant job losses among Britain's financial workforce, resulting in lower tax receipts.
Politico Pro (subscription required) (7/13) 
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UK offers EU agencies post-Brexit transition
UK chief Brexit negotiator David Davis has proposed granting "privileges and immunities" to EU agencies in the UK to allow them an appropriate transition period in which to relocate operations. The extension would depend on the nature of each agency's work and time needed to transfer operations while maintaining functionality.
Politico Pro (subscription required) (7/13) 
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Regulatory Roundup
Fed reviews leverage ratio's effect
Fed reviews leverage ratio's effect
Yellen (Chip Somodevilla/Getty Images)
The Federal Reserve is reviewing the supplementary leverage ratio to determine whether the rule imposes "unintended consequences" on derivatives clearing, Chair Janet Yellen told the House Financial Services Committee. Although banks aren't yet required to comply with the leverage ratio, some financial institutions have adopted it, asset managers say.
MLex (subscription required) (7/12) 
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SEC chief eyes revamp of bond-market structure
The Securities and Exchange Commission plans to expand its review of the efficiency, transparency and effectiveness of the structure of US bond markets, Chairman Jay Clayton said.
Markets Media (7/13),  Pensions & Investments (free access for SmartBrief readers) (7/12) 
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Industry Developments
Top US banks' quarterly trading revenue lowest since 2012
The combined trading revenue of the five largest US investment banks dropped 11% to $18.4 billion during the second quarter from a year earlier, according to analysts' estimates. It is the smallest trading income for a second quarter since 2012.
Bloomberg (7/13) 
Electronic Trading News
HFT firms squeezed to seek additional revenue
A lack of volatility and rising costs have slowed profit at many high-frequency-trading firms, pushing some to seek unconventional revenue opportunities. "The firms that are going to be successful have optimized their business; they're lean and can make profit in this environment," said Greenwich Associates analyst Richard Johnson.
Bloomberg (7/13) 
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Commodities and Managed Futures
SGX to launch more freight contracts
Singapore Exchange plans to increase freight contracts to bolster trading volume. "As with our suite of freight derivatives, the contracts will enjoy capital-efficient margin offsets against other freight contracts, as well as our bunker products," according to SGX.
Futures & Options World (subscription required) (7/13) 
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FIA News
Registration open for FIA Forum: Taipei
On Thursday, Aug. 31, FIA will be hosting its annual Forum in Taipei. Taking place at the Shangri-La's Far Eastern Plaza Hotel, this event will bring together some of the leading players in the region to discuss developments in the Taiwanese market and the impact of global and regional changes on the broader exchange-traded derivatives industry. Attendees will also have the opportunity to network with key industry participants and colleagues throughout the region in this well-attended event. Register!
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