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Futures Guru Targets Libor Replacement; SEC’s Lone Democrat Expected to Step Down in Fall

Apr 17, 2019

First Read

Hits & Takes
JLN Staff

Over the past 10 years, the Thailand Futures Exchange‘s volumes have grown 3,380 percent, from 3 million contracts in 2008 to 104.4 million in 2018, according to the FIA’s annual surveys.~JK

The Tel-Aviv Stock Exchange‘s derivatives volumes have fallen 32 percent since 2009, from 70.9 million contracts in 2009 to 48.1 million in 2018, according to the FIA’s annual surveys. The exchange is expected to go public this year. ~JK

John Sodergreen told me yesterday his midweek shows on oil and natural gas get about 500 viewers for each.~JJL

Laura LaBarbera, formerly of the Chicago Federal Reserve, is now handling public relations for the American Financial Exchange, LLC.~JJL

CurveGlobal Limited is reporting record 3 million SONIA open interest at 53,277, and total open interest is up 166 percent of the end of 2018.~JJL

Former CFTC Chairman Tim Massad has called for stronger cryptocurrency regulations.~JJL

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Changing Interest Rate Trading Market Structure – Andy Ross, CurveGlobal
JohnLothianNews.com
In this video from JLN’s Industry Leader Series, CurveGlobal CEO Andy Ross talks about the shift away from LIBOR and how CurveGlobal is changing the dynamics of interest rate derivatives trading.
Watch the video »

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Lehman Brothers, a Family Saga, as Viewed by Some Who Lived It
Patricia Cohen – NY Times
Thomas Russo, the chief legal officer at Lehman Brothers when the Wall Street colossus filed for bankruptcy and threatened to melt down the global financial system, was recalling that frenzied final weekend in September 2008.
/nyti.ms/2UIE15M

***** Tom Russo can tell stories.~JJL

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BlackRock’s Fink says markets are poised for a ‘melt-up’; A dovish Fed and robust global economy will lure big investors back to equities
Robin Wigglesworth, Richard Henderson and Owen Walker – FT
Global equity markets are poised for a “melt-up” as signs of healthier economic growth in the US and China reassure big investors that have largely stayed on the sidelines of the 2019 market recovery, according to BlackRock’s Larry Fink.
/on.ft.com/2V1QrVH

***** “Melt-up” makes no sense to me.~JJL

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Boy Scouts Are Just Scouts Now, and That’s Making Girl Scouts Mad; The 100-year-old organizations are prepared to take their battle over self-identity to court.
Claire Suddath – Bloomberg
One evening in early February, in the back room of a small Lutheran church in Blacksburg, Va., seven girls joined the Boy Scouts. They stood in front of an American flag, wearing the same khaki shirts and bandanna neckties as the 19 boys there with them. Together they recited the Pledge of Allegiance, followed by the traditional Boy Scout oath. As historic moments go, it was a quiet one.
/bloom.bg/2UGRICx

*****Good Bloomberg-style look at the battle between Boy Scouts and Girl Scouts and a deep dive into their history.~JJL

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Tuesday’s Top Three
Our top read story of the day was Bloomberg’s Trading Bots Running Wild on Crypto Exchanges, Report Says. Second was another Bloomberg piece, from Mohamed A. El-Erian on the disastrous blaze Notre Dame Fire: Symbol of a Millennium, Now a Site of Resentment. Third was The Wall Street Journal’s Third Point, Pershing Square Sell Stakes in ‘Flash Boys’ Exchange IEX

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CryptoMarketsWiki, our archive of the cryptocurrency and blockchain world, is going strong and keeping pace as this area of finance grows and evolves.

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Lead Stories

Futures Guru Targets Libor Replacement; Richard Sandor, known for creating futures markets in the 1970s, has a new Libor alternative that is gaining traction
Daniel Kruger – WSJ
A leading figure behind the creation of futures markets in the 1970s is joining the race to replace the benchmark interest-rate underpinning trillions of dollars worth of financial contracts world-wide.
/on.wsj.com/2Gi98v3

**See AFX’s record volumes in Exchanges.

SEC’s Lone Democratic Member Expected to Step Down in Fall; Departure of Robert Jackson Jr. could lead to rightward shift for commission’s regulatory decisions
Dave Michaels – WSJ
The only Democratic member of the Securities and Exchange Commission is expected to leave government later this year, paving the way for a more conservative tilt on some regulatory decisions.
/on.wsj.com/2UH45hO

Hacker Accused of JPMorgan Breach Is in ‘Fruitful’ Negotiations With Prosecutors
Christian Berthelsen – Bloomberg News
A Russian hacker allegedly at the center of the theft of financial data of more than 80 million JPMorgan Chase & Co. clients is in negotiations with U.S. prosecutors to avoid a trial, according to a court filing.
/bloom.bg/2IzzE60

Santander and Credit Agricole to Create $3.78 Trillion Custodial Bank; The joint venture comes amid a push for consolidation of European banks, which are struggling with low returns and high costs
Patricia Kowsmann – WSJ
Spain’s Banco Santander SA and France’s Credit Agricole SA are to combine their custody and asset-servicing operations, creating a EUR3.34 trillion ($3.78 trillion) custodian business with more scale to compete.
/on.wsj.com/2UH3SLy

First Acuiti Derivatives Insight Report Released Today – Performance Analytics From Across The Global Derivatives Market
The inaugural Acuiti Derivatives Insight Report has found that the global derivatives industry reported solid revenue performance in March but also highlighted the challenges that continuing uncertainty over Brexit is bringing to the UK market.
bit.ly/2Uojgrd

U.K. Watchdog to Probe Lagging Fund Managers and Name Them
Suzy Waite – Bloomberg
The U.K. financial watchdog says it plans to scrutinize underperforming actively managed funds, in another swipe at an industry under pressure.
/bloom.bg/2UFtAQx

In SEC vs. Elon Musk, a Question of When Tweets Matter; Court-ordered talks over 2018 civil fraud settlement focus on oversight of executive’s Twitter use
Dave Michaels – WSJ
Elon Musk agreed with the government last year to have Tesla Inc. lawyers preapprove tweets that “reasonably could contain” material information about the electric car maker’s business. Those words are now at the center of court-ordered talks between the two parties over his 2018 civil-fraud settlement.
/on.wsj.com/2UGTuDn

City of London cements dominance of renminbi trading; Average daily trading volumes of the Chinese currency in London reached £76.6 billion
Nikou Asgari – FT
London has retained its crown of being home to the largest offshore share of renminbi payments.
/on.ft.com/2UInM92

Euronext’s Fastmatch becomes Euronext FX
Euronext
Euronext announces today the rebranding of FastMatch, its Electronic Communication Network (ECN) for Foreign Exchange (FX) trading, into Euronext FX[1]. This is a new step in the further integration of FastMatch, which has been acquired by Euronext in 2017 as part of its strategy to diversify its top line and extend its “best execution” value proposition to an additional asset class.
bit.ly/2KX3Wm7

Morgan Stanley hit by trading and investment banking slump; Results bring the curtain down on a mixed season for US bank earnings
Laura Noonan – FT
Morgan Stanley reported a 9 per cent drop in profits in the first quarter of the year, as the last of America’s big banks to report earnings was haunted by the same falling trading revenues that assailed rivals and also suffered a sharp decline in investment banking fees.
/on.ft.com/2UGRknf

Boring banking is exciting again in the US; Analysts wonder whether retail profits can keep growing in a low-rate environment
Robert Armstrong – FT
Boring banking is exciting again. The stars of the first-quarter earnings season at the big US banks were not high-powered dealmakers, brilliant bond traders or wizards of corporate finance. They were tellers, mobile apps and credit cards.
/on.ft.com/2ULR0UF

Banks pledge millions to rebuild Notre-Dame after fire; SocGen, Axa, Carmignac and more donate funds to assist with the reconstruction of the Unesco World Heritage site
FN Staff
The world’s biggest financial services companies are coming forward with financial aid and support for the restoration of Notre-Dame, the medieval cathedral in the heart of Paris that was ravaged by fire on Monday night.
bit.ly/2Gd8HC4

Citigroup is reevaluating its policy on testing job applicants for marijuana use as Wall Street banks weigh whether to work with the $75 billion cannabis industry
Jeremy Berke – Business Insider
In a sign of the changing times, Citigroup has held ongoing conversations around reevaluating its policy on screening job applicants for marijuana use as Wall Street banks weigh whether or not to work with the industry, a spokesperson confirmed to Business Insider.
bit.ly/2Gn17ou

Exchanges, OTC and Clearing

American Financial Exchange Announces One-Day Record Volume on AMERIBOR Benchmark
AFX
The American Financial Exchange (AFX), electronic exchange for direct interbank lending and borrowing for American financial institutions, announced a record volume trading day on Monday, April 15. A record $2.522 billion were traded across all AFX products, surpassing the previous record of $2.354 billion traded on March 28, 2019. This marks a 7 percent increase from the previous record.
bit.ly/2Iq66Z4

SGX welcomes new Issue Managers Haitong International, W Capital and Evolve Capital Asia
Press Release
Singapore Exchange (SGX) is pleased to welcome Haitong International Securities (Singapore) Pte. Ltd., W Capital Markets Pte. Ltd. and Evolve Capital Asia Private Limited to a growing pool of accredited Issue Managers and Catalist Sponsors.
bit.ly/2UEZ09I

TMX Group Limited to announce Q1 2019 financial results on Thursday, May 9, 2019; Analyst conference call and Annual and Special Meeting of Shareholders to be held Friday, May 10, 2019
TMX
TMX Group Limited will announce its financial results for the first quarter ended March 31, 2019 in the evening of Thursday, May 9, 2019. An analyst conference call to review the results will be held at 8:00 a.m. EDT on Friday, May 10, 2019. The TMX Group Annual and Special Meeting of shareholders will be held at 2:00 p.m. EDT on Friday, May 10, 2019.
bit.ly/2UHOZbJ

Topic of the week: How to tackle risk?
Eurex
Risk management is all about identification, assessment and prioritization of risks, followed by a coordinated, economic use of resources to develop and execute the strategies to manage the risks i.e. control the probabilities and impact of losses. It is also about continuous re-assessment and improvement of risk management capabilities to cope with new emerging risks. So much for the definition. But what specifics risks is Eurex facing, how do we prepare for them and what risk management solutions do we have in place? We asked Thomas Laux, Chief Risk Officer of Eurex Clearing and Dmitrij Senko, his designated successor.
bit.ly/2KJj32m

Green Voices of Nasdaq Nordic: Local Government Plays Key Role in Blossoming Green Bonds Market; The Finnish municipalities have ambitious sustainability targets.
Nasdaq
The Nasdaq Nordic Sustainable Bond Market is flourishing due to our continued commitment to the environment, society and a more responsible future. With over one hundred green and sustainable bonds listed, it is a testament to the extensive integration of sustainable practices amongst Nordic companies.
bit.ly/2GhtaWr

Fintech

AI-assisted stock trading venue plans to use the technology for bigger trades
John McCrank – Reuters
Imperative Execution, a startup electronic stock trading venue operator, has found early success using artificial intelligence (AI) to reduce price movements after trades, and now it plans to use the technology to help brokers get larger trades done.
/reut.rs/2Ukh5VC

Quantum on the money: fintech is banking on the future of computing
E&T Magazine
The financial services sector thinks quantum computing can help supercharge its products and profits, but what impact could it have on cyber-risk exposure?
bit.ly/2KKQoKc

Solactive Drives Innovative Index Development With Cutting-Edge Emotional Data Intelligence Index, Serving As The Underlying For UBS Index Certificate
Mondovisione
Solactive is pleased to announce the development of yet another innovative index utilizing alternative data sources. The next index deployed by the German Index Provider is labeled Solactive Europe Big Data Sentiment Index and features a unique approach of using emotional data. The proprietary algorithm mines user-generated information from Social Media platforms, delivering the primary dataset of this particular index.
bit.ly/2UkjM9G

Apple’s Qualcomm Settlement Is Good News for Tons of Chip Stocks
Kit Rees – Bloomberg
End to legal dispute raises hopes of 5G-enabled iPhone in 2020; European suppliers jump; Morgan Stanley touts RF chipmakers
Qualcomm Inc. isn’t the only winner as its two-year legal fight with Apple Inc. comes to an end: lots of other Apple suppliers may benefit if the iPhone maker is now able to bring a 5G phone to market as early as next year.
/bloom.bg/2UpjgHw

FreightTech investment surges in 2019
Linda Baker – Freightwaves.com
PitchBook and FreightWaves have crunched the numbers and confirmed what most of us already know – the FreightTech sector, defined loosely as software companies that aid in the movement of freight, is on a tear. FreightTech growth has an analog in the broader transportation services category, with four of the five largest venture capital deals in the first quarter of 2019 going to companies that move people or stuff.
bit.ly/2Gjd5zF

Cryptocurrencies

Trading Technologies Launches Direct Market Access to Leading Bitcoin-based Trading Venue BitMEX Through the TT Trading Platform
Trading Technologies
Trading Technologies International, Inc. (TT), a global provider of high-performance professional trading software, infrastructure and data solutions, has partnered with HDR Global Trading, the owner of BitMEX, the world’s largest bitcoin-based trading platform by volume, to offer its market-leading trading tools to cryptocurrency derivatives traders via the TT platform for the first time.
bit.ly/2GnJ7dV

A Chicago trading tech firm is partnering with BitMEX to unleash crypto derivatives on professional traders
TheBlockCrypto
Trading Technologies, a Chicago firm that offers a platform to trade derivatives, equities, and crypto, announced Tuesday a partnership with BitMEX that would allow its users to trade crypto perpetual swaps alongside other cryptocurrency assets on its platform.
bit.ly/2KZDSXx

eToro launches cryptocurrency exchange, adds support for multiple fiat-based stablecoins
The Block
eToro, the global multi-asset trading platform has officially unveiled its fully regulated cryptocurrency exchange, eToroX.
bit.ly/2UGBtoN

Kraken Exchange Joins Binance, ShapeShift in Delisting Bitcoin SV
Anna Baydakova – Coindesk
Another major crypto exchange is delisting bitcoin SV (BSV) amid an ongoing feud between that cryptocurrency’s creator Craig Wright and outspoken members of the bitcoin community. San Francisco-based Kraken announced Tuesday that it will no longer support BSV, citing both community sentiment and ongoing litigation filed against the exchange by the coin’s advocates. Kraken will disable BSV deposits on April 22, trading will cease on all trading pairs April 29 and, finally, withdrawals will stop May 31.
bit.ly/2KN0jij

How Businesses Might One Day Use Cryptocurrency
Laura Shin Senior – Forbes
When Bitcoin first came on the scene, many people mistakenly thought it was an anonymous cryptocurrency. Unfortunately, criminals learned the hard way that it was easily traceable. Several privacy coins have since come on the scene, enabling people to transact without leaving their financial fingerprints on a blockchain, but many of them require a lot of computational resources. Enter a new protocol, Mimblewimble, described last week here, which has a way of creating confidential transactions that take less computer power, thus making it easier to, potentially, someday have many more people using coins built on it.
bit.ly/2Ujxb1O

Craig Wright’s Fight With a Cartoon Bitcoin Astronaut Cat Explained
Alyssa Hertig – Coindesk
There’s a legal conflict brewing between outspoken members of the bitcoin community and the controversial computer scientist who claims to be the cryptocurrency’s creator. It’s a complex story to untangle, but it boils down to Australian computer scientist Craig S. Wright – who has claimed to be bitcoin’s pseudonymous creator since 2016 – sending out legal letters to those community members that have called him a “fraud.”
bit.ly/2KTYb8m

Financier With Ties to an Oligarch Starts Crypto Derivative Hedge Fund
Alastair Marsh – Bloomberg
Gerald Banks, who has structured derivatives for Merrill Lynch & Co. and managed part of a Russian oligarch’s sprawling empire, is now turning his hand to cryptocurrencies.
/bloom.bg/2UGRviJ

Gemini Is Now the Largest Bitcoin Exchange to Add ‘Full’ SegWit Support
Alyssa Hertig – Coindesk
Cryptocurrency exchange Gemini announced Monday that it has added “full” support for segregated witness (SegWit), an important bitcoin code change that paves the way for scaling improvements.
bit.ly/2Gm5rEx

Japan’s Biggest Bank Invests in Crypto Sleuthing Startup Chainalysis
Yogita Khatri – Coindesk
Mitsubishi UFJ Financial Group (MUFG), Japan’s largest bank, has backed an additional $6 million Series B round for cryptocurrency sleuthing startup Chainalysis.
bit.ly/2GiC1as

Digital Asset’s Smart Contract Language Now Works on Hyperledger Blockchains
Ian Allison – Coindesk
Enterprise blockchain firm Digital Asset is integrating its smart contract modeling language into the Hyperledger Sawtooth framework.
bit.ly/2GjknUc

France adopts cryptocurrency regulation; asks EU to follow suit
The Block Crypto
France adopted cryptocurrency regulations last week and is now encouraging EU countries to do the same, Reuters writes.
bit.ly/2GikS0L

Blockchain Goes To Work At Walmart, IBM, Amazon, JPMorgan, Cargill and 45 Other Enterprises
Michael del Castillo – Forbes
On the Jersey side of the Hudson River just across from Manhattan’s Financial District, there is a glass-and-steel office tower designed in a severe International Style aesthetic. “DTCC” is emblazoned across the top, but few outside of Wall Street realize that in this building, occupied by the Depository Trust & Clearing Corp., are records for most of the world’s securities, representing some $48 trillion in assetsófrom stocks and bonds to mutual funds and derivatives.
bit.ly/2GnK2en

Crypto Cowboy Binance Wants to Play By the Rules
Jeff John Roberts – Fortune
Binance came out of nowhere in 2017 to become the world’s biggest cryptocurrency exchange. Its explosive growth has been fueled by a strategy of avoiding the regulatory headaches that go with the conventional banking system, and focusing instead on the freewheeling world of crypto-to-crypto trading.
bit.ly/2GkqPu5

Politics

Why Does Trump Want to Turn America Japanese?; He’s acting as though an economic model that’s produced years of stagnation is something to emulate rather than to fear.
Michael Schuman – Bloomberg
Asia expert Ezra Vogel published his influential book “Japan as Number One” 40 years ago. At the time, he argued that the U.S. needed to adopt aspects of Japan’s supposedly superior economic system if it wanted to compete with the East Asian powerhouse. Policymakers in Washington were wise to ignore him. While Japan sank into a financial crisis and three decades of malaise, the U.S. has continued to prosper.
/bloom.bg/2UFsyUQ

Trump’s Trade War With China Doesn’t Look Like a Win; Prevailing against a fast-growing country run by autocrats isn’t so easy.
Noah Smith – Bloomberg
In March 2018, President Donald Trump uttered his famous declaration that “trade wars are good and easy to win.” A little more than a year later, it looks as if Trump is losing the trade war he started with China.
/bloom.bg/2UHM3Mf

Regulation

Proposed Rule Change to Amend FINRA Rule 6730 (Transaction Reporting)
FINRA
Financial Industry Regulatory Authority, Inc. (“FINRA”) is filing with the Securities and Exchange Commission (“SEC” or “Commission”) a proposed rule change to amend FINRA Rule 6730 (Transaction Reporting) to provide members additional time to report to the Transaction Reporting and Compliance Engine (“TRACE”) transactions in U.S. Treasury Securities executed to hedge a primary market transaction, and to adopt a new modifier to identify such transactions.
bit.ly/2UHdZzT

TRAQS Connections
FINRA
FINRA has observed a small number of TRACE and ORF clients experiencing difficulties with their connections to the TRAQS website. FINRA is currently researching the problem.
bit.ly/2UIKu0E

SEC Approves Amendments to FINRA Rule 4512 to Permit the Use of Electronic Signatures for Discretionary Accounts
FINRA
The Securities and Exchange Commission (SEC) approved a proposed rule change to amend FINRA Rule 4512 (Customer Account Information) to permit the use of electronic signatures for discretionary accounts and to clarify the scope of the rule. These changes become effective on May 6, 2019. The text of the amended rule is set forth in Attachment A.
bit.ly/2UHewln

SEC and FINRA to Hold National Compliance Outreach Program for Broker-Dealers on June 27, 2019
SEC
The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) today announced the opening of registration for their 2019 National Compliance Outreach Program for Broker-Dealers, which will be held June 27, 2019, in Chicago.
bit.ly/2UHf0bb

FCA sets out its priorities for 2019/20
UK FCA
The Financial Conduct Authority (FCA) has today published its Business Plan for 2019/20, which outlines the key priorities for the coming year.
bit.ly/2ULTgeB

ASIC warns trustees about Protecting Your Super laws and provides guidance for consumers
ASIC
ASIC has called on superannuation trustees to provide helpful and balanced communications to their members regarding the Protecting Your Super package (PYSP) of reforms, which are due to take effect on 1 July 2019.
bit.ly/2UE6oCl

Deutsche Bank faces action over $20bn Russian money-laundering scheme; Exclusive: in confidential internal report seen by the Guardian, bank says scandal has hurt global brand
Luke Harding – The Guardian
Germany’s troubled Deutsche Bank faces fines, legal action and the possible prosecution of “senior management” because of its role in a $20bn Russian money-laundering scheme, a confidential internal report seen by the Guardian says.
bit.ly/2GgVRmw

EU banking watchdog clears Estonian, Danish regulators over Danske Bank
Jacob Gronholt-Pedersen – Reuters
The European Union banking watchdog said on Wednesday that its investigation into financial regulators in Estonia and Denmark in relation to suspected money laundering activities by Danske Bank did not find any breach of EU law.
/reut.rs/2GpE7pg

Britain’s markets watchdog to review post-Brexit rules
Reuters
Britain’s markets watchdog will review its rules as the country readies to leave the European Union, the source of its financial regulation for decades.
/reut.rs/2GjkgIg

Investing and Trading

Niche asset nears mainstream as investors warm to EU carbon market; There are four reasons to be optimistic about the attraction of the allowances scheme
Mark Lewis – FT
European carbon allowances, the carbon credits that serve as the unit of compliance under the European emissions-trading scheme, have been the world’s top-performing commodity over the past two years.
/on.ft.com/2UFuzQU

Trader Trafigura allies with Altis to gain access to petrochemicals; Joint venture gives commodity house access to key area of growth in oil demand
David Sheppard – FT
Trafigura, one of the world’s largest commodity houses, has entered into a joint venture that will give it a foothold in petrochemical trading for the first time, the company said on Wednesday.
/on.ft.com/2UIjizg

Bond sales running at record pace; Issuance reaches $747bn, a record in the year to date, on the back of corporate debt sales
Chelsea Bruce-Lockhart and Joe Rennison – FT
Bond sales are booming in 2019, running at a record pace globally for the year so far, as a pivot in monetary policy among the world’s central banks prompts a fresh binge in corporate borrowing.
/on.ft.com/2UGSKOB

Traders wake up to cost of coffee volatility as farmers down tools; Low prices lead coffee growers to abandon farms while others turn to coca
Emiko Terazono – FT
The lowest international coffee prices in a decade are leading many despairing farmers in Central and South America to abandon their farms, fuelling fears of an industry crisis.
/on.ft.com/2UDzdP8

Generalisations about coal are fraught with risks; Underlying drivers for fuel prices remain intact despite a softening in Europe’s market
Neil Hume – FT
All fossil fuels are not created equal. Take thermal coal, which is burnt in power stations to produce electricity. It almost defies categorisation as a commodity because differences in quality vary markedly from region to region.
/on.ft.com/2UJQ7Mf

Can the Oil Industry Win Over Generation Z?
Sam Unsted – Bloomberg
Generation Z has precious little love for oil and gas stocks, but winning over these younger, climate-conscious investors will be essential for the sector’s future, Barclays Plc analysts say.
/bloom.bg/2UGSAXF

Hemp In, Spinach Out as Investors Throw Money at Newly Legal CBD
By Hema Parmar and Craig Giammona – Bloomberg
Production of marijuana’s cousin is exploding in the U.S.; Demand for hemp products could rival cannabis, investor says
When Patrick Horsman’s small private equity firm purchased 10,000 acres in Yuma County, Arizona, in 2016, organic spinach and lettuce were on the menu.
/bloom.bg/2UEnNe6

Emerging-market forex revenues eclipse ‘G10’ for first time
Tommy Wilkes – Reuters
Investment banks are now earning more from trading emerging-market currencies than from the major G10 markets, as wild swings in the likes of the Turkish lira contrast with relative calm in the dollar, euro and yen.
/reut.rs/2Gl3DMg

Institutions

Metals Brokers Profit as Bank Exodus From Commodities Continues
Mark Burton – Bloomberg News
Metals brokers are enjoying a surge in trading profits as they exploit an exodus of banks from commodities markets.
Marex Spectron and Sucden Financial, ring-dealers on the London Metal Exchange’s open-outcry trading floor, last week reported a jump in earnings. As the investment banks that came to dominate during the commodities supercycle continue to pull out, the brokerages are profiting from renewed volatility in markets.
/bloom.bg/2GpJ1DQ

U.S. Bancorp Posts Higher Profit, Driven by Net Interest Income Increase; Noninterest income also rose
Allison Prang – WSJ
U.S. Bancorp reported a rise in profit in its first quarter as total revenue ticked higher, driven by an increase in net interest income.
/on.wsj.com/2UHpmrJ

BlackRock’s Profit Declines, but Assets Under Management Again Top $6 Trillion; Money manager faces heightened competition that is rippling across asset management world
Dawn Lim – WSJ
BlackRock Inc.’s first-quarter profit declined, squeezed by heightened competition and the aftereffects of a late 2018 market rout.
/on.wsj.com/2UHOf6r

Morgan Stanley Reports 9% Decline in Profit; Bank was hit by same trading slump that hurt other Wall Street firms; results beat expectations.
Liz Hoffman – WSJ
Morgan Stanley said its first-quarter profit fell 9% from a year ago, hit by the same trading slump early in the year that hurt other Wall Street firms.
/on.wsj.com/2UHcQIB

Former UBS compliance officer accused of helping trader make £1m; Court told Fabiana Abdel-Malek fed inside M&A information to friend
Barney Thompson – FT
A former compliance officer at UBS fed insider information on proposed mergers to her day trader friend using disposable SIM cards and “burner” phones, enabling him to make more than £1m, a court was told.
/on.ft.com/2UIjq1I

Hedge funds realise going long has its rewards; High-flying funds are finding the fastest growth coming from an unlikely part of their business
Lindsay Fortado and Laurence Fletcher – FT
Buying stocks and hoping they gain in price was once considered the poor cousin of hedge fund investing. But as the industry looks to recover from its first annual drop in assets since the financial crisis, high-flying fund managers are being forced to think again.
/on.ft.com/2UHc9it

BlackRock Bounces Back With ‘Huge Excitement’ Over Fixed Income
Annie Massa – Bloomberg
Fixed income products took in $80 billion in first quarter; Assets under management rose above $6 trillion again
BlackRock Inc. rebounded from a rocky end of last year, as customers jumped into its fixed-income products and showed interest in illiquid alternatives.
/bloom.bg/2UEUMim

Bank of New York Mellon Tumbles; CEO Warns of Yield-Curve Pain
Felice Maranz – Bloomberg
Bank of New York Mellon shares are dropping 4.6 percent in pre-market trading after the bank reported earnings per share, net interest margin and revenues that missed analysts’ expectations, and Chief Executive Officer Charlie Scharf warned the yield curve would hurt revenue for several quarters to come.
/yhoo.it/2GmZJ5m

Regions

Mining Opponents Harassed, Killed in South Africa, HRW Says
Antony Sguazzin – Bloomberg
Municipalities often block protests against mine projects
Police break up peaceful protests violently, report says
Community activists who oppose mining projects in South Africa are often harassed, threatened and sometimes killed, according to a report by advocacy groups including Human Rights Watch.
/bloom.bg/2KLTs8P

Argentina’s foreign exchange regime is broken; It must be fixed before it is too late
Marcos Buscaglia, Miguel A Kiguel and Eduardo Levy Yeyati – FT
When it comes to saving the peso, Argentina has tried everything under the sun, from an assortment of crawling bands and pegs in the 1970s and 80s, to a legal peg to the US dollar in the 90s, to (very) dirty floats in the 2000s. Sooner or later, they all ended in tears.
/on.ft.com/2UFvuRb

Singapore’s OCBC Seeks Partner for China Securities Business
Chanyaporn Chanjaroen and Juliette Saly – Bloomberg
Talking with several candidates, CEO says in an interview; Joins global rivals in eyeing China securities business
Oversea-Chinese Banking Corp. is looking for a Chinese firm to team up with on a securities joint venture on the mainland, the latest foreign bank seeking to capitalize on the nation’s financial-industry loosening.
/bloom.bg/2UGR1c5

China Is Producing More Steel Than Ever
Bloomberg News
Production of crude steel notched an all-time high in 1Q; Investment in railways, subways, sewage will boost demand: BI
China’s steel industry notched another production record in the first quarter, spurred by consumption in the infrastructure sector as government stimulus props up demand.
/bloom.bg/2UFsMeE

KKR Strikes Hedge Fund Gold With British Billionaire Pair
Tom Metcalf and Heather Perlberg – Bloomberg
Private equity giant owns 35% stake in U.K.’s Marshall Wace; Marshall Wace assets have doubled in four years to $39 billion
A pair of 200-year-old wooden elephants adorn the London lobby of one of the financial world’s biggest beasts. The carvings guard the Chelsea office of fast-growing $39 billion hedge fund Marshall Wace.
/bloom.bg/2V0SIRi

Credit Suisse Stops Some Japan Bond Underwriting
Issei Hazama – Bloomberg
Profit was said to be too low due to small number of deals; Stopping sales of RMBS, regional debt, govt-backed notes
Credit Suisse Group AG has stopped underwriting certain types of bonds in Japan, a business that offered only limited profits for the Swiss bank given the low number of deals it handled, according to a person familiar with the matter.
/bloom.bg/2UIlTcs

Brexit

UK financial watchdog admits pressures from Brexit demands; FCA’s priority is supporting an orderly transition period after Britain’s EU exit
Philip Georgiadis – FT
The UK’s financial regulator said Brexit will place “considerable demands” on it over the next year, as the complexity of extricating Britain’s financial services industry from the EU weighs heavily on its resources for the third year running.
/on.ft.com/2UIrXS0

Divorce Reforms May Make Breakups Easier for London’s Bankers
Will Mathis and Thomas Beardsworth – Bloomberg
New law eliminates need to cite adultery or bad behavior; Reforms may help rich spouses end unhappy marriages faster
London courts have long been home to some of the world’s most expensive and acrimonious divorces. Celebrities and scores of wealthy bankers have been caught up in ugly courtroom battles that have — at least in part — been triggered by archaic rules that forced one spouse to blame the other for the breakup.
/bloom.bg/2UIHQrK

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Past Newsletters

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