US Commodity Futures Trading Commission Chairman J. Christopher Giancarlo says he does not plan to pursue a current proposal that would require source code used in trading algorithms be accessible to regulators without a subpoena. "[W]hile there were some good things in the proposal, there were other things that were unacceptable and perhaps unconstitutional," Giancarlo said during FIA's 34th Annual Futures & Options Expo in Chicago.
Predictions that artificial intelligence and automation will change the world are not new. While processor speed has increased, a fundamental breakthrough in replicating human intelligence remains elusive.
Banks are challenging a rule that requires reporting of current expected credit losses, saying it hinders their ability to loan and cuts into earnings. Representatives of BB&T, Citizens Financial Group, KeyCorp, M&T Bank and Regions Financial have met with lawmakers to ask that the rule be changed.
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Value exchange-traded funds have attracted inflows by matching returns of the current bull market, though these returns will be threatened should the market turn. Pure factor ETFs have an edge in the face of a market correction.
The Secured Overnight Financing Rate is gaining traction as a replacement to Libor amid a growth in futures volumes using SOFR. The World Bank, Fannie Mae and Credit Suisse have led the way in offering floating-rate notes pegged to SOFR.
Bankers for high net worth individuals and families are typically asked to blur the line between business and friendship. "Banking, like a lot of high-dollar sales professions, demands a certain level of personal commitment; the best bankers create the impression that their interest in their clients is personal and genuine rather than transactional," writes Matt Levine.
A recent Bloomberg survey finds optimism among investors about Latin America's bonds and currencies and Asia as the region of choice for equity investments. "Some confidence in EM has been restored following strong policy responses in both Argentina and Turkey, and a lighter political calendar ahead," said Marcelo Assalin, head of emerging markets debt at NN Investment Partners BV.
Since 2014, major US banks have shifted from being buyers to sellers of credit risk exposure. This reduction in credit risk exposure is directly linked to a pullback in use of credit default swap markets.
CME Group's bitcoin futures average daily volumes rose 41% during Q3 over the second quarter and were up 170% over Q1. The third quarter saw 5,053 contracts traded, compared to 3,577 contracts in Q2 and 1,854 contracts in Q1.
A survey by Smarsh finds financial firms struggling when it comes to retention and management of text messages and exchanges via social media. Half of respondents cited compliance as a primary worry when it comes to non-email communication.
The Benchmarks Task Force has been formed to provide clarity and to help with administrative challenges in adoption of International Securities Identification Numbers. The task force, formed by the Association of National Numbering Agencies, plans to work with benchmark administrators to "address some of the practical applications of the ISIN standard," association Managing Director Emma Kalliomaki says.
Financial-technology firms have shifted from disrupting the banking industry to partnering with banks, OnDeck's Christin Spradley said at the Banking Policy Institute's Fintech Ideas Festival in Washington, D.C. The Consumer Financial Protection Bureau is changing a trial disclosure program and might join a network of international fintech regulators, said Paul Watkins, head of the CFPB Office of Innovation and a keynote speaker at the event.
Liquidity creation has fallen in recent years among banks with more than $50 billion in assets that are covered by the US liquidity coverage ratio, researchers at the Federal Reserve say. The discovery raises the question of whether the standard, adopted after the financial crisis, is "socially harmful," the researchers say.
Commodity Futures Trading Commission Chairman J. Christopher Giancarlo said the US is ready to retaliate if EU regulators force US counterparties to violate US rules in order to comply with EU regulations. If that situation arises, the US will respond with "a range of readily available steps to protect US markets and market participants," he said.
Members of the Financial Stability Oversight Council voted unanimously to withdraw its designation of Prudential Financial as a systemically important financial institution, which had subjected the insurer to more intense oversight than some other financial firms. Treasury Secretary Steven Mnuchin said a detailed analysis showed that "there is not a significant risk that the company could pose a threat to financial stability."