Integrated Reports Voluntary Filing

On May 31, 2010, South Africa established the Integrated Reporting Committee (IRC) under the chairmanship of Professor Mervyn King. The founding members of the committee are The Association for Savings and Investment SA, Business Unity South Africa, Institute of Directors SA, Johannesburg Stock Exchange, and The South African Institute of Chartered Accountants.

A Report on COP 15: Living with Snow and Sun

As we landed at the airport we got a glimpse of things to come. There was an exclusive welcoming reception for the conference participants, with friendly receptionists handing out “Welcome to Hopenhagen” brochures. The event’s host city of Copenhagen would become for the next two weeks “Hopenhagen”, the city of hope where the world would gather in December of 2009 to discuss the future of the planet at the 15th United Nations Climate Change Conference (COP 15).

Sifting the Chaff

Egypt's stock exchange delists firms in a move to put quality over quantity. The Egyptian Stock Exchange (EGX) delisted 14 companies at the start of the year. According to a statement on the EGX’s website, the firms’ shares were transferred to the Over the Counter (OTC) Board (Orders Market) for two weeks starting January 3. This move gave individual investors time to leave the companies before they were transferred to the OTC Market (Deals) two weeks later.

MIFID Revised : a Proposal

The forthcoming review of the Markets in Financial Instruments Directive (MiFID), which came into force on 1 November 2007, is being undertaken against the backdrop of the financial crisis. It will prove crucial both for the re-regulation of financial activities and for the stability of the global financial system.

A Retrospective on the Unfixing of Rates and Related Deregulation

Traditional stock exchanges were membership organizations where stock exchange members dealt with one another on a preferential price basis. Fixed minimum commissions were the glue that held the New York Stock Exchange (NYSE) and other exchanges together, while members of the National Association of Securities Dealers (NASD) dealt with one another at an inside trading price. Commission price regulation similarly was the norm in Canada, Australia, London, Japan, and elsewhere. In addition, NYSE rules required members to bring all of their orders to the NYSE floor for execution, prohibited access to the exchange by non-members, and required member firms to be engaged primarily in the securities business. NYSE member firms could not incorporate or become public companies.

Regulatory Reform and the Role of an Industry Utility

Legislators and regulators in Washington, D.C. are working to make changes to the way banks and markets are governed in the U.S. and how those rules are to be enforced. While this is true around the world, this article will focus on the U.S.

Opportunities in Derivatives Exchanges in an Inflationary Environment

Many central banks around the globe had to take active and aggressive measures to protect their local financial markets and economy during the recent financial turmoil. Thus, interest rates were reduced and quantitative easing of monetary policy brought liquidity back to the market. Fiscal spending was also augmented to stimulate demand, adding more funds available to the market.

Quest for Transparency

In March 2010, the WFE was invited to take part in a conference organized by the Australian market regulator, ASIC. The topic was the transparency: how had or transparent or ‘lit’ markets performed compared to the counter markets or ‘dark’ trading venues.

The Role of Central Counterparties in Financial Crisis Recovery

While the financial crisis caused massive fallout on the bilaterally traded over-the-counter (OTC) side, exchange-traded and centrally cleared derivatives escaped with barely a scratch. Since then, growing clearing volumes point to centralised clearing becoming one of the major growth areas of the financial market. The crisis exposed inefficiencies as large segments of the market were neither standardised nor automated – despite the speed of global trading activity and the increased complexity of transactions. This was not seen to be a problem in a bull market but, when the credit crisis rapidly unfolded, users of bilateral transactions were scrambling to pick up the pieces. OTC market participants and regulators alike have realized that clearing houses offering central counterparty services (CCP) provide practical solutions that the market desperately needs: transparency, neutrality and efficiency enabling the mitigation of counterparty risk.

Market Safety and Integrity for Derivatives

The global derivatives market is a main pillar of the international financial system and the economy as a whole. Today, businesses around the world use derivatives to effectively hedge risks and reduce uncertainty about future prices. Derivatives contribute to economic growth and increase the efficiency of markets by improving price discovery for assets.