John Lothian Newsletter: Deutsche Bank Drops to Record as Some Clients Reduce Exposure; ICE Clear Credit Recognized As Third-country Central Counterparty Under EMIR; Derivatives surge sees two thirds of firms increasing tech investments

Sep 30, 2016

First Read

Who Needs Tickets?
Next week is the A Leg To Stand On Rocktoberfest event here in Chicago, at City Winery on October 6 at 6 p.m.

This year Geneva Trading is providing four tickets for the event, each valued at $200 per ticket.

If you’d like to attend and want a chance to win the 4-pack, please click on the link Geneva Trading and go to Geneva Trading’s page on Marketswiki. The fifth person to click on the page wins. Simple, no strings and the winner and friends will have a great time.

If you have not been to Rocktoberfest, it is a great time for a great charity, which helps provide free prosthetic limbs and corrective surgery to kids in developing countries. This small but powerful charity has provided care to more than 15,000 kids so far.

The event features bands from the industry and is well worth checking out. For more information on the event, please check out ALTSO Rocktoberfest

And don’t worry, Cubs fans, game one isn’t until October 7th. You can make it.

The winner will be contacted by John Lothian & Co. by the email used to click on the Geneva page. (Yes, we can do that.) We’ll connect and get you the tickets. Good luck!

Or if you just want to buy tickets directly for the event, go to www.altso.org/rocktoberfestchicago#tickets. There are still some tickets available.

++++

John Lothian News Brings A World of Opportunity to London For Third Year
MarketsWiki Education
John Lothian News is bringing its MarketsWiki Education World of Opportunity series to London for the third straight year on Monday, October 31, 2016. The registration is up and ready on the MarketsWiki Education page of the John Lothian News website.Interns, new employees and anyone interested in learning more about opportunities, trends and careers in the capital and derivatives markets should attend. Please pass this information on to anyone who you think would be interested in attending.
jlne.ws/2dJXE7Y

**** We have set up a Google Form for registration; however some firms are blocked from using Google apps. In that case we need an email to johnlothian@johnlothian.com with the names of the attendees, their email addresses, the name of the supervisor and their email address.

++++

MWE Europe 2016

++++

Intercontinental Exchange Announces Promotion of Hester Serafini to President of ICE Clear U.S. as Tom Hammond Retires
ICE
Intercontinental Exchange, a leading operator of global exchanges and clearing houses and provider of data and listings services, announced that derivatives industry veteran, Thomas Hammond, will retire as President of ICE Clear U.S. on January 1, 2017. Hester Serafini, currently Chief Operating Officer of ICE Clear U.S., will become President at that time. Hammond will begin transitioning his ICE Clear U.S. responsibilities to Serafini starting October 1, and, beginning January 1, will take on new responsibilities advising on global strategic clearing initiatives.
jlne.ws/2cEkxoe

***** Tom Hammond retiring is big news. He is a much respected figure in the Chicago futures clearing world. He was never afraid to call things as he saw them – an important trait to have at the top of the clearing house. He may have been the most relaxed clearing executive in the industry, which exuded confidence in the markets and the structure.

++++

Invest in the Future; Trading Tech Awards Event to Launch Merit Badge Workshop Program Expansion
By John J. Lothian
For 45 years the financial community of Chicago has been supporting the Boy Scouts of America with an event that used to be held right on LaSalle Street under a big circus tent in front of the U.S. Federal Reserve Building. The event was the LaSalle Street Dinner. It still exists, but in a different form.
In the past, leaders from the financial community, prominent bankers, brokers, clearinghouse executives and exchange leaders served as the chairs of the event. This year a humble media executive/Scouter and an FIA Principal Traders Group member firm executive serve as co-chairs of the event. Matt Haraburda, president of XR Trading, is the latter and I am the former.
/goo.gl/dtLGGD

***DA: You can register for the event HERE.

++++

OSTC’s Jonny Aucamp Riding High (25 vertical feet high!) for Colon Cancer Awareness
John Lothian News
Jonathan (Jonny) Aucamp is the Group Executive Chairman of OSTC Ltd. in the Greater London area. He is leaving his cushy executive’s chair and strapping on the cycling shorts to raise money to raise awareness for colon cancer research. He is part of a team of 50 riding to support the work of the world leading specialists at St Mark’s Hospital in London, via the charity 40tude.
/goo.gl/dg5OCS

***** Please support Jonny’s efforts, we did.

++++

New CEO for Baltic Exchange
Heavy Lift
The Baltic Exchange Limited (Baltic Exchange) has named Mark Jackson as its next ceo. Currently chief commercial officer of AM Nomikos Group and a former chairman and director of The Baltic Exchange, Jackson is expected to take up his appointment early in 2017 and replaces the current ceo Jeremy Penn, who last year announced his intention to stand down this summer.
jlne.ws/2cZyUV4

***** I am guessing this Mark Jackson is not the former Knicks point guard Mark Jackson.

++++

Kenny Polcari, O’Neil Securities – Charting a Career
MarketsWikiEducation.com

“Let me go and check this out. I’m either going to love (an intern job at the NYSE) or I’m going to hate it. If I hate it, OK, chalk it up to experience, but if I love it, it may change the course of my life. And, in fact, it changed the course of my life.”

Market strategists love to follow charts. They look for trends, breakouts and key reversals. They pay close attention to entry points and exit strategies. Most importantly, they know they must concentrate not on the last trade, but rather the next one.

In this highly energetic and entertaining MarketsWiki Education talk, Kenny Polcari charts his 30-year career in the context of a 30-year chart of the Dow Jones Industrial Average. The stock market, like most people’s careers, will see plenty of highs and lows, periods of consolidation and periods of volatility. And if you are lucky, you will also see a whole lot of action and a whole lot of fun.

Watch the video »

***DA: This is the fourth of our ten New York 2016 presentations. Last week we released Kristin Boggiano of Guggenheim Partners, Bill Harts of the Modern Markets Initiative and Adena Friedman of Nasdaq. We will finish out the New York run just as the team steps onto the plane for the European tour.

++++

Thursday’s Top Three
Yesterday’s top clicked story came out of Bloomberg – Peak Finance Looks Like It’s Over. Apparently, peak finance is a lot like peak oil, in that it is often predicted but never seems to come about. In second place was an interview with TransMarket Group founder Ray Cahnman, conducted by Trading Technologies’ CEO Rick Lane. A good read for anyone who knows Ray, or anyone who has been around the industry a while.
Rounding out the top three was news from Reuters that the Securities and Exchange Commission is about to release new rules on clearing houses deemed systemically important. Read about it HERE.

Lead Stories

Deutsche Bank Drops to Record as Some Clients Reduce Exposure
William Canny, Jan-Henrik Foerster – Bloomberg
Millennium, Capula among counterparties shifting positions; CEO says bank has never been more stable in past two decades
Deutsche Bank AG Chief Executive Officer John Cryan rushed to shore up confidence in his beleaguered lender after concern some clients are reducing exposure to the company pushed shares to record lows.
/goo.gl/BW8PoS

ICE Clear Credit Recognized As Third-country Central Counterparty Under EMIR
ICE
Intercontinental Exchange (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that ICE Clear Credit was recognized as a third-country central counterparty (CCP) for products regulated by the U.S. Commodity Futures Trading Commission (CFTC) in accordance with the European Market Infrastructure Regulation (EMIR). Additionally, the European Securities and Markets Authority (ESMA) gave further relief for security-based swaps, which are regulated by the Securities Exchange Commission, while they work toward an equivalence determination.
/goo.gl/6WGO9C

***DA: Big day for ICE.

Derivatives surge sees two thirds of firms increasing tech investments; Firms look to increase tech investment in 2017 amid surge in derivatives activity.
By Hayley McDowell -The Trade
Over two thirds of financial institutions will increase investments in technology in 2017 to keep up with the surge in derivatives activity, according to a recent survey by FINCAD.
/goo.gl/U5NDIU

Goldman’s Libya Salesman Was a Little Too Good
By Matt Levine – Bloomberg
I used to sell equity derivatives at Goldman Sachs, which puts me in fascinating company. For instance there is Youssef Kabbaj, a London-based equity derivatives salesman who, in 2008, was described internally as “perhaps Goldman’s top salesman globally.”
/goo.gl/hLl2aw

Och-Ziff to pay $413M to settle cases over bribery in Africa
By Carleton English – NY Post
Hedge funder likens low interest rates to crack-cocaine
Och-Ziff, the $39 billion New York hedge fund, agreed on Thursday to pay $413 million in fines, penalties and disgorgements to settle US criminal and civil charges that it paid bribes to secure business in Africa over a five-year period.
/goo.gl/PO1UoL

German bank woes will dash Frankfurt’s great dream
ALLISTER HEATH – Telegraph
Fears are growing about the financial health of Deutsche Bank, Europe’s biggest lender
Funny, that. If you were to spend too much time listening to the Brexit debate, you might be forgiven for thinking that the City is facing a catastrophe while Frankfurt is poised to boom, or at least to seize vast amounts of business from London.
/goo.gl/ObQzkq

Japan suffers setback in war on deflation; Slowing in underlying inflation highlights challenge BoJ faces in reaching target
by: Robin Harding in Tokyo
Japan remains in the grip of deflation, with consumer prices falling for a fifth consecutive month and price momentum slowing further in August.
/goo.gl/SxZOYV

French sacrifice may not be enough for LSE/Deutsche Börse
By Tim Cave – Financial News
With the ink barely dry on a European Commission document referring the merger between Deutsche Börse and the London Stock Exchange Group to an in-depth antitrust review, the LSE revealed its intent to give up its French clearing business in a sale to remedy competition concerns.
/goo.gl/DYArjD

Martin Fraenkel Named President of S&P Global Platts
PRNewswire
S&P Global (NYSE: SPGI) today announced that Martin Fraenkel has been appointed as President of S&P Global Platts and will join the S&P Global Operating Committee reporting to Mike Chinn effective immediately.
/goo.gl/BmXk7P

Deutsche Bank News

The Ghost of Lehman Brothers Haunts Deutsche Bank; But parallels to failed investment bank are misleading
By JAMES MACKINTOSH – WSJ
Eight years ago this month, Lehman Brothers failed in large part due to panicked hedge funds pulling their money. With some big hedge funds worried enough to cut their exposure to Deutsche Bank AG, the parallel is obvious—but also deeply misleading.
/goo.gl/luVV0N

Deutsche Bank, UBS, RBS Said to Mull Selling Tradeweb Stakes
Matthew Leising and Matthew Monks – Bloomberg
Deutsche Bank AG, UBS Group AG and Royal Bank of Scotland Group Plc are considering selling their minority stakes in Tradeweb Markets LLC, a bond and derivatives trading system, according to people familiar with the matter.
jlne.ws/2cZobda

Hedge funds pull business from Deutsche Bank; Pressure on German bank weighs on its shares and the wider US market
by: James Shotter in Berlin, Martin Arnold and Laura Noonan in London – FT
Hedge funds have started to pull some of their business from Deutsche Bank, setting up a potential showdown with German authorities over the future of the country’s largest lender.
/goo.gl/YqRXR0

Deutsche Bank admits ‘perception issue’ as shares slide
By Gernot Heller and Andreas Rinke – Reuters
Deutsche Bank shares were indicated down 6.2 percent ahead of the opening of the Frankfurt market on Friday, after Germany’s largest lender admitted it had an image problem with investors as fresh concerns over its stability emerged.
/goo.gl/7AOQsX

Ten People Who Will Be Key in Deciding Deutsche Bank’s Future
Alessandro Speciale, Angela Cullen, Patrick Donahue – Bloomberg
Players include Merkel, Achleitner, Draghi and Schaeuble; DBK boss Cryan: Raising capital is “currently not an issue”
Pressure on Deutsche Bank AG has increased since the lender revealed two weeks ago the U.S. Justice Department is asking for $14 billion to settle a probe tied to residential mortgage-backed securities the bank traded before the 2008 financial crisis.
/goo.gl/HYNRe9

Deutsche Bank’s Troubles, Europe’s Failures
Bloomberg Editorial Board
Less than a decade after the financial crisis, Deutsche Bank is in trouble again, with investors speculating about whether the German government will have to rescue one of the world’s largest financial institutions. The sad thing is how easily this predicament could have been avoided.
/goo.gl/CvLDV7

Exchanges, OTC and Clearing

London Metal Exchange Looks to Win Back Business
WSJ
It is getting harder to know how much of the world’s metal is in storage, and that is a problem for anyone trying to determine a market price for aluminum, copper or nickel. Warehouses registered with the London Metal Exchange have been a major storage hub of base metals for dozens of years. These facilities provide inventory data on a daily basis, making them a handy gauge of industry supply.
jlne.ws/2cZyTjW

Cadillac Fairview and TMX Group announce lease agreement in MontréalA- A+ Print
September 29, 2016; Montréal Exchange to relocate to Deloitte Tower in city’s burgeoning Quad Windsor district
TMX
Cadillac Fairview and TMX Group are proud to announce today the signing of a long-term lease agreement to relocate the Montréal Exchange (MX) to Deloitte Tower in 2018. MX and the Montréal offices of The Canadian Depository for Securities, Canadian Derivatives Clearing Corporation, Toronto Stock Exchange and TSX Venture Exchange will occupy approximately 44,000 square feet on two floors of the 26-storey office building, and will start adapting the space for occupancy this fall.
/goo.gl/Ti5iVH

Holiday schedule on 3 October
Eurex
On Monday, 3 October 2016 (German Unification Day) Eurex is closed for trading in German Equity and Equity Index Derivatives as well as different ETF and ETC Derivatives.
/goo.gl/xBBkb

Takeaway.com celebrates its first day of trading on Euronext; Successful Tech IPO raises EUR 328 million
Euronext
Euronext Amsterdam today welcomes Takeaway.com (ticker code: TKWY), a leading online food delivery marketplace in Continental Europe. The listing follows the company’s successful Initial Public Offering (IPO), with a total offering of EUR 328 million.
/goo.gl/BYjO8x

ASX to Decide on Replacing CHESS Platform with Distributed-Ledger Solution by End of 2017
Wei-Shen Wong – WatersTechnology
The Australian Securities Exchange (ASX) has completed its distributed-ledger-based prototype for a new equities clearing and settlement platform, but will only make its final decision whether or not to replace its existing Clearing House Electronic Subregister System (CHESS) platform at the end of 2017. “At the back-end of calendar year 2017 we will be in a position to announce whether this will indeed replace CHESS,” ASX said in an announcement in conjunction with its annual general meeting on Sept. 28.
jlne.ws/2cZwo18

Low-Code Development Pays Off For Commodities Exchange
Curtis Franklin – InformationWeek
CME Group sounds like the sort of organization that would hew to a conservative, time-tested development platform for applications. But according to Ari Studnitzer, managing director of architecture and product management at CME Group, the company has embraced a low-code platform that is helping keep both users and regulators happy.
jlne.ws/2cZxD0o

BSE’s international stock exchange to go live in Jan
Shrimi Choudhary – Business Standard News
Asia’s oldest bourse BSE plans to operationalise its international stock exchange during the Vibrant Gujarat Global Summit in January 2017. The exchange is planning to invest Rs 500 crore for setting the exchange, which would initially start off with derivatives products, said a source in direct know of the matter.
jlne.ws/2cZu2PO

FTSE Russell Announces Results Of FTSE Annual Country Classification Review
London Stock Exchange Group
China A-shares remain on Watch List for future inclusion as a Secondary Emerging market; Argentina, Nigeria and Romania join Watch List for possible reclassification; FTSE Russell provides progress update on current Watch List countries Poland, Kuwait, Saudi Arabia, Kazakhstan & Mongolia
FTSE Russell, the global index and data provider, today announces the results of the FTSE Annual Country Classification Review for 2016. FTSE Russell formally reviews country classifications within its FTSE Global Equity Index Series (FTSE GEIS) each September using a comprehensive, transparent and consistent methodology. This annual review incorporates ongoing country classification research and feedback from the independent FTSE Russell external advisory committees to designate markets as Developed, Advanced Emerging, Secondary Emerging or Frontier.
/goo.gl/qedV9E

LCH adds Commonwealth Bank of Australia as first Australian PPS Bank
LCH
Addition of CBA as a PPS bank allows LCH to pay and collect Australian Dollars in the local time zone; Underlines LCH’s commitment to growth in Australia and Asia Pacific
LCH, a leading global clearing house, announced today that Commonwealth Bank of Australia (CBA) has become its first Australian Protected Payments System (PPS) Bank. Having an Australian PPS Bank enables LCH to make and receive Australian Dollar payments in the local time zone.
/goo.gl/VljSdh

Report on Initial Public Offering Applications, Delisting and Suspensions
HKEX
/goo.gl/I2Sck0

Politics

‘Trump’s promises are empty’: energy experts lay waste to proposals
Peter Stone – The Guardian
Donald Trump’s energy agenda – which includes pledges of “complete energy independence”, making coal great again and ditching the Paris climate deal – is drawing bipartisan fire from industry analysts, former members of Congress, and even one coal mogul.
jlne.ws/2cZpfhl

Donald Trump Pointed to 9/11 Attacks in Asking SEC for Leniency During Fraud Probe; Businessman said he had worked to bring ‘company back from a very difficult time’ after terror attacks
By REID J. EPSTEIN and DAVE MICHAELS – WSJ
When Donald Trump’s casino company was facing a civil fraud investigation over its accounting practices, the New York businessman asked the Securities and Exchange Commission to show mercy because of the Sept. 11, 2001, terrorist attacks.
/goo.gl/DGTsDV

Wall Street Journal editorial board member endorses Clinton
By Harper Neidig – The Hill
A member of the Wall Street Journal’s traditionally conservative editorial board has endorsed Hillary Clinton for president, calling her “eminently sane” and bashing Republican nominee Donald Trump as the candidate of “white supremacists and swastika devotees.”
/goo.gl/jfRxbJ

Investing and Trading

Even OPEC Can’t Break Oil Out of This Range
Nicole Friedman – WSJ
OPEC’s move toward a potential production cut surprised the market yesterday — but not enough to break prices out of their months-long range. U.S. oil has traded roughly between $40 and $50 a barrel since mid-April. Investors and traders largely believe it will hold in that range through at least the end of the year.
jlne.ws/2cZuJIX

Japanese stocks: unloved and stuck in the shadow of Abenomics
Leo Lewis – Financial Times
This has flown comfortably under most investor radars, but Japan’s marriage services sector has been seized by a fever of high-premium buyouts, IPOs and consolidation chatter. For those wanting to punt on this enchanting nuptial theme, there is a glut of ways to do so. Japan has as many listed wedding organisers as the UK has listed drinks manufacturers, with a far more beguiling diversity of market shares, specialities and price/earnings multiples to choose from.
jlne.ws/2cZvTnw

Och-Ziff Plea Stalls Rise of Hedge-Fund Billionaire’s Protege
Nishant Kumar, Franz Wild – Bloomberg
Michael Cohen led the firm’s investments in Europe and Africa; Bribe investigation coincided with retirement from the fund
At the turn of the century, hedge-fund billionaire Daniel Och sent protege Michael Cohen, still in his twenties, to spearhead Och-Ziff’s expansion into Europe. Cohen’s team bet so successfully on equities and corporate deals that less than a decade later he was able to buy a 900-acre estate in the English countryside.
/goo.gl/rR5bkx

Rare Google Bear Sighting Reported
Dan Gallagher – WSJ
The Google Bear is a rare breed. When James Dix of Wedbush Securities downgraded Internet giant’s parent company Alphabet to an underperform rating this week, he joined a relatively exclusive club. In fact, he’s the only member. Mr. Dix is the sole Wall Street analyst tracked by Factset to currently rate the stock as the equivalent of sell and is the first to do so since late 2010.
jlne.ws/2cZuDRF

European Market Outlook: Banking sector woes intensify
Eurex
/goo.gl/Wlx3HW

Institutions

BOJ chief seeks to extend ultraloose legacy beyond his term
Jun Ishikawa – Nikkei Asian Review
Although the Bank of Japan’s pivot toward interest rate controls has been the subject of much interest, Gov. Haruhiko Kuroda was mostly focused on an entirely different issue when forming the new monetary framework: how to ensure the ultraloose stimulus continues even after he steps down.
jlne.ws/2cZuqhk

Banks tighten SWIFT system security after hacks
Tom Bergin – Reuters
Banks are tightening the security of their SWIFT messaging networks – used by the industry to shift trillions of dollars each day – following revelations that hackers are increasingly able to get into this system to steal money.
jlne.ws/2cZvEsN

Wells Fargo Chief Blames Employees, Not Company Culture, for Scandal
Stacy Cowley – NY Times
In more than four hours of intense and hostile questioning on Thursday, lawmakers denounced Wells Fargo’s history of illegally created sham bank and credit card accounts opened by its employees in the names of real customers: It was “theft,” “a criminal enterprise,” identity fraud, an outrage, and a devastating blow to the entire banking industry.
jlne.ws/2cZsOUv

Some Deutsche Bank Clients Reduce Collateral on Trades
William Canny – Bloomberg
Amid mounting concern about Deutsche Bank AG’s ability to withstand pending legal penalties, about 10 hedge funds that do business with the German lender have moved to reduce their financial exposure. The shares slumped.
jlne.ws/2cYYycn

Deutsche Bank Still a Buy, Says Rare Analyst With Bullish Rating
Donal Griffin – Bloomberg
Deutsche Bank AG is a “great restructuring story,” and short sellers have helped drive the lender’s shares to a record low this week, according to an analyst at Kepler Cheuvreux. The share-price decline “has been driven by concerns about the bank’s credit profile, which we believe are unjustified,” Jacques-Henri Gaulard, one of three analysts with a buy rating on the stock, wrote in a note to clients Thursday.
jlne.ws/2cZmP2a

IBM Shakes Up AI Race for Banking by Buying Promontory
Rob Blackwell – American Banker
IBM has agreed to buy Promontory Financial Group — a consultancy so influential it has been dubbed the industry’s “shadow regulator” — in a move that could extend artificial intelligence into every aspect of banking. Under the deal, which was announced Thursday, Promontory’s stable of ex-regulators and former industry executives will be tasked with teaching IBM’s Watson to address risk management and compliance issues at banks.
jlne.ws/2cZrxwN

Rise of Shadow Banks Is Amplifying Monetary Policy, IMF Says
Andrew Mayeda – Bloomberg
The growing role of shadow banks in the global financial system is enhancing the potency of monetary policy, according to the International Monetary Fund. Some economists have argued that the decline in traditional bank lending has dampened the impact of changes in interest rates by central banks. But in a paper released Thursday, the IMF said the opposite is true: the transmission of monetary policy actually appears to be slightly stronger in countries with large shadow banking sectors.
jlne.ws/2cZrmSk

TD looks to acquire corporate loans in United States
Reuters
Toronto-Dominion Bank (TD.TO) wants to increase its corporate lending in the United States by acquiring loans from other foreign banks retreating from the country, one of its top executives said on Thursday. TD has been beefing up its U.S. investment banking operations at a time when European lenders have been pulling back in the wake of tougher regulations and the need to bolster their balance sheets.
jlne.ws/2cZprxb

RBS Resurrects NatWest Markets as Part of BOE Ringfencing Plans
Richard Partington – Bloomberg
New structure will help bank meet plans taking effect in 2019; Bank selects name used by the securities unit in the 1990s
Royal Bank of Scotland Group Plc said it would resurrect the NatWest Markets brand for its investment bank as part of its plan to meet rules designed to prevent a repeat of its 45.5 billion-pound ($59 billion) taxpayer-funded bailout during a financial crisis.
/goo.gl/hsGRQO

Lloyds May Face $2.1 Billion Charge on Pension and PPI, UBS Says
Richard Partington – Bloomberg
London-based bank may need funds to meet pensions liabilities; Additional PPI charge will probably result in lower dividends
Lloyds Banking Group Plc, Britain’s largest mortgage lender, may take a 1.6 billion-pound ($2.1 billion) charge in third-quarter earnings to cover a pension deficit and customer compensation, according to analysts.
/goo.gl/eOUKWr

Secret Alpine Gold Vaults Are the New Swiss Bank Accounts; “There has been a real interest in alternatives to bank deposits.”
Hugo Miller, Stephanie Baker – Bloomberg
Deep in the Swiss Alps, next to an old airstrip suitable for landing Gulfstream and Falcon jets, is a vast bunker that holds what may be one of the world’s largest stashes of gold. The entrance, protected by a guard in a bulletproof vest, is a small metal door set into a granite mountain face at the end of a narrow country lane. Behind two farther doors sits a 3.5-ton metal portal that opens only after a code is entered and an iris scan and a facial-recognition screen are performed. A maze of tunnels once used by Swiss armed forces lies within.
/goo.gl/RAvQRB

Fintech

AI is ‘Next Big Thing’ to worry about
Richard Waters – Financial Times
After talking up its latest “Next Big Thing” as world-changing in its impact, the tech industry now finds itself in the uncomfortable position of trying to argue that it will not end up being world-destroying instead.
jlne.ws/2cZuD3N

Trustly to Double Staff as European Fintech Expansion Gains Pace
Niklas Magnusson, Hanna Hoikkala – Bloomberg
Swedish startup expects to have 260 employees in two years; Financial services has biggest potential among business areas
Trustly Group AB plans to double the number of employees in the next two years as the Swedish startup’s push to cut the middlemen from online payments and win banks as customers gains traction.
/goo.gl/HMUcRg

Cultural shift needed amid FinTech focus; Industry must undergo a cultural shift and leverage FinTech applications to be successful in the future.
By Paul Walsh – The Trade
A distinct cultural shift is required in the industry as firms needs to embrace millennial culture in their pursuit of FinTech developments, according to a panel.
/goo.gl/ylLHcj

Regulation

Wells Fargo Troubles Mount With Penalty for Soldiers’ Loans
Jesse Hamilton and Tom Schoenberg – Bloomberg
Wells Fargo & Co., reeling from weeks of pummeling over fraudulent customer accounts, is now facing a Justice Department sanction over improperly repossessing cars owned by members of the military, according to two people with knowledge of the investigation.
jlne.ws/2cZnZKU

After 11 Years of Waiting, Judge Tries to Speed Up Civil Trial of AIG’s Greenberg
Leslie Scism- WSJ
A New York state judge is trying to get the wheels of justice to turn a little faster in the long-delayed civil-fraud trial of former American International Group Inc. Chairman Maurice R. “Hank” Greenberg. On Wednesday, Judge Charles Ramos asked Mr. Greenberg to refrain from drawing out his answers to questions from the state attorney general’s office. Mr Greenberg had made repeated comments about how the amount of money involved was immaterial to overall results at the global insurer.
jlne.ws/2cZs16b

MF risks: SEBI mulls stronger scales
Business Line
After the investment shocks of last year that rattled some mutual fund buyers, capital market regulator SEBI has been working on strengthening the overall risk management system of the industry. According to sources, the regulator is keen on introducing stronger risk parameters to secure public investments further in the 15-lakh crore mutual fund industry.
jlne.ws/2cZzCl5

Och-Ziff CEO Cleared Africa Deals, U.S. Says in Bribe Probe
Keri Geiger and Matt Robinson – Bloomberg
Hedge fund founder Dan Och allowed investor funds to flow to deals in Africa over the objections of his legal team, and the firm then booked a series of bribes as investments. Failures by Och, the chairman and chief executive officer of Och-Ziff Capital Management LP, are at the heart of a U.S. criminal and regulatory settlement unveiled Thursday that describes a widespread conspiracy of bribery to win natural resources deals in which the fund invested across Africa.
jlne.ws/2cZoC7j

New appointment To Hong Kong’s Securities And Futures Commission Committees
Press Release
The Securities and Futures Commission (SFC) is pleased to announce the appointment of Mr Thomas Atkinson, Executive Director of Enforcement, as a member of both the Securities Compensation Fund Committee (Note 1) and the Investor Compensation Fund Committee (Note 2) effective 28 September 2016.
jlne.ws/2cZpjxr

CFTC fines, bans former Delta Air fuel executive over illegal trades
Reuters
The U.S. Commodity Futures Trading Commission on Thursday penalized a former Delta Air Lines fuel trading executive $5.25 million over futures and options trades the agency said were illegal.
jlne.ws/2cZu8GZ

Barclays FX ‘Cartel’ Trader Ashton Loses Unfair Dismissal Suit
Jeremy Hodges – Bloomberg
Ashton was banned from U.S. banking by Fed last month; Trader shared confidential information with rivals, bank says
A Barclays Plc trader fired amid the foreign-exchange market manipulation scandal lost his unfair dismissal case in London.
/goo.gl/V3AB5m

CFTC Orders Jon P. Ruggles to Disgorge More than $3.5 Million in Trading Profits and Pay a $1.75 Million Penalty for His Illegal Futures and Options Trading
CFTC
The U.S. Commodity Futures Trading Commission (CFTC) today entered an Order filing and settling charges against Jon P. Ruggles of Orlando, Florida, for engaging in fraudulent, fictitious, and noncompetitive trades in crude oil and heating oil futures and options and RBOB gasoline futures on the New York Mercantile Exchange (NYMEX), a division of CME Group, from March 2012 to December 2012. During that time, Ruggles resided and worked in Atlanta, Georgia.
jlne.ws/2cEAj7i

CFTC Charges Options Trader Thomas C. Lindstrom with Fraud
CFTC
The U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement Complaint, charging Thomas C. Lindstrom, of Winnetka, Illinois, with fraud in connection with his trading of options on 10-year U.S. Treasury note futures (T-Note Options). Lindstrom is registered with the CFTC as a floor broker, has been a member of the Chicago Board of Trade (CBOT) since 1993, and is a long-time trader of T-Note Options offered on the CBOT.
jlne.ws/2dhnX2M

BBX, ex-CEO win new U.S. trial in SEC financial crisis case
Reuters
BBX Capital Corp, a Florida company once known as BankAtlantic Bancorp, and its ex-chief executive have won a new trial in a lawsuit by the U.S. Securities and Exchange Commission accusing them of defrauding investors before the 2008 financial crisis.
jlne.ws/2cZoSTW

SEC charges former Puma Biotech employee with insider trading
Reuters
The U.S. Securities and Exchange Commission said on Thursday it had charged a former employee of Puma Biotechnology with insider trading, and that the Justice Department was pursuing a parallel criminal case.
jlne.ws/2cZu4a8

Canadian Securities Regulators Issue Guidance On Derivatives Reporting Obligations
Press Release
Staff of the securities regulators in Alberta, British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, Saskatchewan and Yukon today published CSA Multilateral Staff Notice 91-305 Frequently Asked Questions relating to Multilateral Instrument 91-101 Derivatives: Product Determination and Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting.
jlne.ws/2cZs3uY

FCA outlines tighter unbundling rules; RPAs can be funded through CSAs, but brokers can no longer retain money intended to pay for research.
By Hayley McDowell – The Trade
Under MiFID II rules, research payment accounts (RPA) are allowed to be funded by commission sharing agreements (CSA), although CSA cash cannot be retained by brokers to pay for research.
/goo.gl/iVEKXk

Regions

India cottoning on to ending cotton ties with Pak
Business Standard News
India’s $782-million worth of cotton exports to Pakistan is likely to come to a halt, with exporters keen to divert shipment to other cotton scarce countries, following talks of withdrawal of the Most Favoured Nation (MFN) status to its neighbour.
jlne.ws/2cZp85e

China Seeking to Succeed Where Japan Failed in Yuan Global Push
Justina Lee, Enda Curran – Bloomberg
Major reserve currency impossible with closed markets: analyst; Yen’s challenge to dollar petered out as economy declined
As China’s yuan takes the first steps toward becoming a global reserve currency, Japan offers a lesson on how hard it is to rival the dollar’s supremacy.
/goo.gl/YdZ9nY

PBOC Seen Switching to Monetary Tightening as Soon as 2017
Bloomberg News
Easing since late 2014 has fueled property bubble, rising debt; Economists see new methods of tightening amid policy evolution
With China’s economy stable for now and home prices in major cities soaring, analysts are dialing back forecasts for additional monetary stimulus, with some betting on a switch to tightening mode.
/goo.gl/KSRW9c

France rewrites rule books in anticipation of mass UK exodus
29 September 2016 | Finextra
French regulator are speeding up licensing procedures and providing an English-speaking contact for British financial institutions and fintech firms looking to relocate their business in the event of a hard exit from the European Union.
/goo.gl/Vy7CHE

FTIL sells entire stake in Bourse Africa for $10.5 million; In 2014, Continental Africa Holdings had agreed to buy Bourse Africa for $40.5 million
LiveMint
Financial Technologies India Ltd (FTIL), renamed as 63 Moons Technologies Ltd, on Thursday announced that it has sold its entire stake in Bourse Africa Ltd for $10.5 million to Continental Africa Holdings Ltd (CAHL).
/goo.gl/1eGveo

Miscellaneous

Family pressing for answers in deaths of two sisters who died on African island vacation; The bodies of Annie Korkki, 37, of Denver, and Robin Korkki, 42, of Chicago, were found Sept. 22, 2016, at the Maia Luxury Resort on the tropical African island of Seychelles.
William Lee – Chicago Tribune
A Chicago woman who “just really cared about life” was one of two sisters found dead while they were vacationing on a tropical African island.
/goo.gl/G8vW5W

**** Robin Korkki was a commodities trader.

Offshore Wind Farms See Promise in Platforms That Float
By DIANE CARDWELL – NY Times
The sun was beating down on the leafy campus of the University of Maine one afternoon last month. But inside a hangarlike laboratory, a miniature hurricane was raging.
/goo.gl/ayLuqP

John Lothian Newsletter

We visit more than 100 websites daily for financial news (Would YOU do that?)

“John Lothian and Company… our industry intelligence.”

Rick Lane

CEO, Trading Technologies

Past JLN Newsletters

ETF trading surges on European stock exchanges

ETF trading surges on European stock exchanges

First Read $26,851/$300,000 (9.0%) Denise Knabjian ++++ Hits & Takes JLN Staff The U.S. has surpassed the 25 million Covid-19 infections level, according to data reported Sunday by Johns Hopkins University. JPX has signed a memorandum of understanding, or MOU,...

Pin It on Pinterest

Share This Story