Libor-Replacement Competitor Gains Strength From New Offerings

Apr 19, 2021

First Read

$37,826/$300,000 (12.6%)

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Hits & Takes
John Lothian & JLN Staff

Gary Gensler has been sworn in as the chairman of the SEC. – (Bloomberg), (SEC)

The World Health Organization warns of a global surge in COVID cases and deaths with the world approaching the highest rate of infection. Brazil and India are particularly affected. – (ABC News)

Robinhood Financial, LLC was hit with an order from the SEC that found that from 2015 through September 2018, Robinhood made material misrepresentations and omissions relating to its revenue sources, specifically its receipt of payment from certain principal trading firms for routing Robinhood customer orders to them, and relating to certain statements about the execution quality Robinhood achieved for its customers’ orders. The Commission also found that Robinhood’s customers received inferior execution prices compared to what they would have received from Robinhood’s competitors, caused in large part by the high payments for order flow resulting in Robinhood’s failure to satisfy its duty of best execution. Robinhood was fined $65 million, which went into a newly created “fair fund” so the fine can be distributed to harmed customers. The charges were originally brought in December 2020 – (SEC)

Amazon Web Services (AWS) is holding a financial services symposium on May 4, 2021. The virtual free conference is “designed for executives and professionals in the financial services industry seeking new strategies to drive business transformation.” – (AWS)

The World Federation of Exchanges is holding its 37th Clearing & Derivatives Forum this week. It is a virtual event. – (World Federation of Exchanges)

FlexTrade has a timely entry on their FlexAdvantage Blog by Ivy Schmerken titled “Converting Capital Markets to Cloud.” – (Flextrade)

The CME Group is holding a webinar on Tuesday, April 27, at 10 a.m. CT titled “Bitcoin for Institutions: The New Normal.” The webinar will explore the factors driving institutional interest and participation in bitcoin. Speakers will include Christine Sadler, head of sales of marketing for Fidelity Digital Assets, Tim McCourt, managing director and global head of equity products and alternatives investments, Michael Sonnenshein, CEO of Grayscale Investments, and Michael Moro, CEO of Genesis. – (CME Group)

Journalist Erin Arvedlund has a great commentary in Vanity Fair titled “20 Years After I First Questioned Bernie Madoff’s Success, the Great Villain of the Financial Crisis Is Dead.” – (Vanity Fair)

The Block announced via a blog post by The Block CEO Michael McCaffrey, “the successful close of a management buyout to form the only employee-owned firm in crypto research, news and information services.” – (The Block)

Katten partner Lance Zinman has been named to The American Lawyer’s 2021 Midwest Trailblazer’s list, recognizing him as an “agent of change” in the financial services industry. – (Katten)

DRW is looking for a compliance officer in their Chicago office to assist in the oversight of all North American-based compliance, including surveillance, monitoring, developing and enforcing compliance policy and procedures, and providing compliance education and counsel to internal futures trading businesses. – (DRW)

Curve Global CEO Andy Ross has a big grin on his bearded face these days as they just had their best quarter ever and they announced BNP Paribas is now live for their house STIR traders. Also, their “fee free” trading period continues until the end of September.

HSBC is letting U.S. interns pick between in-person and virtual work schedules for its 10-week summer program. – (Insider)

We had no new donations to the JLN MarketsWiki Education GoFundMe campaign yesterday. Remember, the next $17,300 in donations will be matched dollar for dollar by Trading Technologies. Support our efforts to preserve industry history by giving to our GoFundMe campaigns.

Today we have the first of a two-part video interview with Tom Ascher, executive chairman of Quantitative Brokers, for the Open Outcry Traders History Project. Later this week we will release videos of bond trader Jim Marzano and former CME Group CIO Jim Krause for The History of Financial Futures and The Path to Electronic Trading series, respectively.

Have a great day and stay safe and treat people the same way you want to be treated: with respect, equality and justice.~JJL

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Tom Ascher – Open Outcry Traders History Project – Part One
JohnLothianNews.com

Tom Ascher was interviewed by John Lothian News over Zoom for the Open Outcry Traders History Project. Ascher traded at the Chicago Board Options Exchange, and after getting into exchange politics he rose to vice chairman of the CBOE board. He later served as the CEO of Nasdaq-Liffe and had a long run as the chief strategy officer of the International Securities Exchange. Today, he is the executive chairman of Quantitative Brokers, which is majority owned by Deutsche Boerse.

Watch the video »

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Options traders make gargantuan VIX options bet; FINRA gently reminds members to exercise “reasonable diligence” – The Spread
JohnLothianNews.com

This week on The Spread, traders make a $40 million bet on VIX options, FINRA reminds its members to vet options trading accounts appropriately, MIAX announces a new partnership, and more.

Watch the video »

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Episode 9 of STA Trading Views: An Exchange with a View, features Ronan Ryan, president and co-founder of IEX, and John Ramsay, chief policy officer, IEX.
STA
Our conversation includes the ability for exchanges to compete in today’s regime; what a Gary Gensler chairmanship means for the SEC’s priorities and the backstory on IEX’s popular podcast, Boxes + Lines.
/bit.ly/3mV9IUv

****This ISDA podcast to listen to.~JJL

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The High Cost of the Slow COVID Vaccine Rollout
Michael Blanding – Harvard Business School
Aggressive investment in COVID-19 vaccine production earlier on could have saved lives and prevented $700 billion in global economic losses, says research by Scott Duke Kominers and colleagues.
/hbs.me/3gmoVNg

*****The faster the better. The faster, the more money we save.~JJL

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There’s a Name for the Blah You’re Feeling: It’s Called Languishing; It’s the neglected middle child of mental health, and can dull your motivation and focus. It may be the dominant emotion of 2021.
Adam Grant – NY Times
At first, I didn’t recognize the symptoms that we all had in common. Friends mentioned that they were having trouble concentrating. Colleagues reported that even with vaccines on the horizon, they weren’t excited about 2021. A family member was staying up late to watch “National Treasure” again even though she knows the movie by heart. And instead of bouncing out of bed at 6 a.m., I was lying there until 7, playing Words with Friends. It wasn’t burnout — we still had energy. It wasn’t depression — we didn’t feel hopeless. We just felt somewhat joyless and aimless. It turns out there’s a name for that: languishing.
/nyti.ms/2QCc2DI

*****I can relate. It is difficult to have goals when your horizon is hazy.~JJL

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Friday’s Top Three
The top-read story on Friday was from CNBC, There’s a single New Jersey deli doing $35,000 in sales valued at $100 million in the stock market. The second most widely read story was a profile of Sam Bankman-Fried, the founder of FTX, by the Wall Street Journal, This Vegan Billionaire Disrupted the Crypto Markets. Stocks May be Next. The third was from Bloomberg, ‘Dramatic’ Round of Regulation Seen Coming for Cryptocurrencies.

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Lead Stories

Libor-Replacement Competitor Gains Strength From New Offerings; Ameribor poses a challenge to the Secured Overnight Financing Rate, preferred by many Wall Street banks and regulators
Julia-Ambra Verlaine – WSJ
Financial industry pioneer Richard Sandor is ramping up his efforts to compete in the race to replace the London interbank offered rate, which helps set borrowing costs on everything from mortgages to business loans. Mr. Sandor—who helped create interest-rate futures in the 1970s and launched his own replacement for the scandal-marred short-term interest-rate benchmark in 2019—is expanding offerings to include one-month and three-month borrowing rates. Ameribor is set on the American Financial Exchange, which was founded by Mr. Sandor and is where banks lend to each other through mutual lines of credit. Some small and medium-size lenders favor Ameribor because it changes with their funding costs.
/on.wsj.com/32ue7nP

Global Derivatives Market Embraces Pact to Preempt Libor Pain
William Shaw – Bloomberg
Most major financial firms have signed on to ISDA protocol; There’s close to $280 trillion in derivatives linked to Libor
A sweeping agreement designed to prevent turmoil from being unleashed in the global derivatives market when Libor expires is gaining widespread acceptance. Nearly 14,000 parties have agreed to sign on to the ISDA protocol, according to the International Swaps and Derivatives Association. The pact allows for Libor to automatically be yanked from hundreds of trillions of dollars of interest-rate swaps, futures and options and replaced with another rate, addressing a major risk hanging over markets as the discredited benchmark’s end nears.
/bloom.bg/3n1BDlv

‘Litigation will take over’: US lawmakers warned of Libor chaos; Regulators and Wall Street unite to demand action from Congress to speed transition from rate benchmark
Joe Rennison, Colby Smith and Philip Stafford – FT
US regulators and government officials last week appeared en masse before a congressional committee to make a plea over the country’s sluggish transition away from scandal-hit interest rate benchmark Libor. Without an act of Congress, they said, there could be chaos.
/on.ft.com/32ofowS

Why Covid-19 Vaccination in Poorer Nations Has Slowed, Posing Global Risks; As the pandemic’s weight shifts to the developing world, a huge gap in vaccinations is opening with rich nations
Gabriele Steinhauser, Nicholas Bariyo and Jon Emont – WSJ
Efforts to vaccinate the poorest countries against Covid-19 have slowed to a trickle, leaving many with weakened defenses against the coronavirus just as the weight of the pandemic shifts from developed to developing nations.
/on.wsj.com/3ejeszv

Bank of England Joins Global Peers Exploring a Digital Currency
Lucy Meakin – Bloomberg
Task force will consider creation of BOE-issued digital money; ECB, Riksbank are also looking at possibility of CBDCs
Britain’s Treasury and the Bank of England are weighing the potential creation of a central bank digital currency, joining authorities from China to Sweden exploring the next big step in the future of money.
/bloom.bg/2QxdEi6

Netscape 2.0: Coinbase stock debut rekindles memories of web breakthrough; Crypto exchange’s market listing heightens Wall St debate over future of digital currencies
Eric Platt and Miles Kruppa – FT
For cryptocurrency enthusiasts, this week’s blockbuster US stock market listing for Coinbase is the modern equivalent of the Netscape debut that thrust the internet into the mainstream of finance a quarter of a century ago.
/on.ft.com/3x1joS5

Morgan Stanley boss deems multi-million-dollar trading loss from Archegos collapse money well spent; James Gorman, CEO at Morgan Stanley, told analysts the loss was ‘necessary’ and ‘money well spent’ as the bank totals losses far smaller than other prime brokers.
Hayley McDowell – The Trade
A multi-million-dollar trading loss suffered by Morgan Stanley due to the collapse of family office Archegos Capital Management was necessary and money well spent, the chief executive of the US investment bank has said.
/bit.ly/32uzPbk

Anti-Money-Laundering Prosecution Deals Setbacks to European Banks; ABN Amro agreed to pay around $575 million to settle a criminal case accusing it of violating money-laundering and terrorism financing rules
Patricia Kowsmann – WSJ
Failures to police money laundering procedures hit two major banks in Europe, dealing a further setback to a region that has struggled to stop financial institutions from serving as conduits for illicit transactions. ABN Amro Group ABN 2.36% NV said Monday that it had agreed to pay around $575 million to settle a criminal case accusing the Dutch lender of violating money-laundering and terrorism financing regulations repeatedly for several years.
/on.wsj.com/3n7HB4E

Harassment Allegations and Fear Haunt European Investment Bank; A December suicide sparked concern by employee representatives about the risk of more deaths. The bank says it’s focused on well-being.
Stephanie Bodoni, Gavin Finch – Bloomberg
The news came as a shock — another suicide at the Luxembourg headquarters of the European Investment Bank, the second on the premises in seven years. This one, on a cold, wet morning in December, involved a well-liked 51-year-old former semi-pro basketball player who worked as a back-office assistant at the European Union financial institution. Police didn’t give any reason why she jumped from a balcony at the bank. But elected staff representatives who had been talking to management about mental health issues for years, even before an intern fell to her death in the atrium of another building on the campus in 2013, were alarmed.
/bloom.bg/3gm96pz

The Archegos meltdown caused huge messes at some of the world’s largest banks — but it also proved the post-financial crisis rules made us safer
George Pearkes – Insider
Archegos, the family office of former Tiger Capital Management portfolio manager Bill Hwang, grabbed the attention of investors around the world in mid-March when the firm suffered catastrophic losses thanks to a portfolio that had two big problems: high leverage and intense concentration in a few stocks.
/bit.ly/3dsHJse

U.S., China Say They Will Cooperate to Tackle Climate Change
Dominic Lau and Philip Heijmans – Bloomberg
Countries issue joint statement after meeting of envoys; Two nations will work toward implementing Paris Agreement
The U.S. and China are committed to cooperating to tackle climate change, they said in a joint statement after meetings between senior envoys last week that were held amid rising geopolitical tensions between the two countries.
/bloom.bg/3aDWGGb

Covid Will Leave Deep Scars in World Economy Even After Recovery
Enda Curran and Simon Kennedy – Bloomberg
Policy makers urged to tackle pandemic’s economic scarring; Widening inequality is already an early legacy from the crisis
Just as some patients recovering from Covid-19 suffer long-lasting symptoms, it’s becoming clear that the same will be true for the global economy once this year’s V-shaped rebound fades.
/bloom.bg/3x8tYXx

India’s COVID Surge Affects the Entire World; The subcontinent was set to vaccinate dozens of other nations. Then its own outbreak spiraled out of control.
Nitish Pahwa – Slate
On Friday, India reached a record of 217,000 COVID-19 infections in 24 hours, far outpacing any other country (and likely still undercounting the total, considering the subcontinent’s long-inadequate testing regime). This week, it surpassed Brazil as the second-most-infected country in the world, and is now only behind the United States in total infection and death rates. Reports of packed hospitals, low oxygen supply, overflowing crematoriums, and the spread of multiple variants abound. As alarming as this is for India itself, the increased global demand for vaccines and the deadly new variants developing within the country pose grave dangers for the rest of the world as well.
/bit.ly/3gn5eom

These Technologies Could Hold Back Business Travel Indefinitely; The rise of Zoom studios and FaceTime tours—not to mention specially designed robots—suggest a new reality for business-to-business dealings even in the most hands-on of industries: manufacturing.
Christopher Mims – WSJ
It’s a sunny, breezy morning in Eugene, Ore., a place best known for access to the great outdoors, a history of environmental activism and being the birthplace of Nike. I’m standing outside a nondescript, one-story industrial space, speaking with Mark Frohnmayer, chief executive of Arcimoto, maker of a three-wheeled electric vehicle it calls a “fun utility vehicle.”
/on.wsj.com/3dtXEX0

When Fed Chief Talks, So Do Listeners—and They Provide an Earful; Virtual presentations by Federal Reserve Chairman Jerome Powell often include chat-room commentary. ‘Pump pump pump!!! Print the money!!!’
Paul Kiernan – WSJ
Federal Reserve Chairman Jerome Powell has worked hard to explain the central bank’s policies to ordinary people, hoping to shore up trust at a time of wavering public faith in institutions. The effort has produced some unintended results.
/on.wsj.com/3druCay

Hedge Funds Are Ready to Get Out of New York and Move to Florida; A tax hike is the latest reason the biggest moneymakers are debating leaving for the Sunshine State.
Ben Steverman and Katherine Burton – Bloomberg
Carl Icahn has already left New York. Dan Sundheim is planning to leave. Larry Fink is staying, but is worried about its future. New York was struggling to retain some of the world’s richest people and the firms they operate even before Governor Andrew Cuomo and state lawmakers hiked taxes on millionaires and billionaires. Wall Street’s biggest names — including Goldman Sachs Group Inc., Apollo Global Management Inc. and Point72 Asset Management — are taking steps to expand elsewhere, especially Florida.
/bloom.bg/3tA6w35

HSBC top brass forced to hot desk as HQ scraps executive floor; Senior staff evicted from 42nd level of Canary Wharf tower to make room for collaborative space
Stephen Morris – FT
HSBC chief executive Noel Quinn has abolished the entire executive floor of its Canary Wharf skyscraper in east London as the bank becomes the latest to drive through sweeping changes to post-pandemic working practices.
/on.ft.com/32rl5tT

Coronavirus

Global Covid Cases Hit Weekly Record Despite Vaccinations
Jinshan Hong – Bloomberg
More than 5.2 million people diagnosed with Covid last week; Record comes amid vaccine rollouts intended to slow new cases
More people were diagnosed with Covid-19 during the past seven days than any other week since the start of the pandemic — topping 5.2 million globally — with the worst outbreaks accelerating in many countries that are ill-equipped to deal with them.
/bloom.bg/3mZecta

The Real Vaccine Crisis Isn’t About J&J or AstraZeneca; One of the most serious Covid-era challenges the world will face is the unequal distribution of vaccines between rich and poor countries.
David Fickling – Bloomberg
To judge by the headlines, you’d think the most critical immunization issue facing the world is the safety and hesitancy concerns over the AstraZeneca Plc and Johnson & Johnson vaccines. That debate is genuinely important. Still, it shouldn’t distract from the biggest challenge the world will face over the coming months: the grossly unequal distribution of vaccines between rich and poor countries.
/bloom.bg/2OZmG70

Sydney Virus Cases Transmitted During Quarantine Raise Concerns
Emily Barrett – Bloomberg
Concerns in Australia about Covid-19 spreading in quarantine are mounting as three new cases among a family of returned travelers were discovered to have been transmitted in a Sydney hotel. The infections, initially recorded as contracted overseas, are now believed to have been picked up from a family of four in an adjoining room in a city quarantine hotel, New South Wales Health said in a statement Sunday. Investigations into how the transmission occurred are under way, it said.
/bloom.bg/3akOfPR

Covid Survivors May Require Just One Shot of a Two-Dose Vaccine
Carey Goldberg – Bloomberg
Findings take on added urgency with J&J, AstraZeneca issues; European countries make it policy, but U.S. awaits more data
Coronavirus vaccines were just rolling out in December when more than 1,000 staffers at Cedars-Sinai Medical Center in Los Angeles volunteered for a sweeping study. The goal: pinpoint how immune reactions to the jab might vary.
/bloom.bg/3x58lr0

WHO warns of global surge in COVID cases, deaths as world approaches ‘highest rate of infection’; The WHO said the global infection rate was approaching the highest so far.
Guy Davies – ABC News
The pandemic is reaching deadly new heights across the world, the WHO warned this week, even as the focus in some countries, including the U.S., has shifted toward how quickly to ease restrictions as vaccination figures eke upward.
/abcn.ws/3x08Jah

Vaccine Manufacturing Issues Force Moderna to Cut Supplies to Canada, U.K.
The problems involve the Covid-19 vaccine supply chain for countries other than the U.S., the company said
Peter Loftus and Paul Vieira – WSJ
Moderna Inc. MRNA 6.84% expects a shortfall in Covid-19 vaccine doses it will deliver to countries outside the U.S., including Canada and the U.K., citing issues with its European supply chain.
/on.wsj.com/3ttXqVG

Japan Virus Surge Raises Worries Over New Tokyo Emergency
Jon Herskovitz – Bloomberg
Yuriko Koike instructs officials to consider taking the step; Survey shows broad opposition to holding Games as planned
The governors of Tokyo and Osaka opened the door to declaring another virus emergency in Japan’s biggest metro areas as infections surge, adding to the challenges facing an Olympics that’s less than 100 days away in the capital.
/bloom.bg/32v0rJr

Empty middle seats reduce virus risk on planes, a new study says, taking no account of mask-wearing.
Emily Anthes – NY Times
Keeping the middle seats vacant during a flight could reduce passengers’ exposure to airborne coronavirus by 23 to 57 percent, researchers reported in a new study that modeled how aerosolized viral particles spread through a simulated airplane cabin.
/nyti.ms/3edJCIq

More News
– The Covid-19 Plasma Boom Is Over. What Did We Learn From It? – (NY Times)

– U.S. Is Unlikely to ‘Just Cancel’ J&J Shots, Fauci Says – (Bloomberg)

– COVID-19: Mounting calls for India to be put on travel ‘red list’ amid variant fears (Sky News)

– Why America’s white evangelicals shy away from covid jabs – (The Economist)

– Colombia Detects Cases of Covid-19 Variant First Found in U.K. – (Bloomberg)

– Covid Claims 3 Million Lives as Burden Shifts to Poorer Nations – (Bloomberg)

– Expat Americans Fly Home for Covid-19 Vaccination Shots – (WSJ)

– EU Orders Additional 100 Million Doses of Pfizer-BioNTech Shot – (Bloomberg)

– Italy seeks domestic production of mRNA Covid vaccines; Rome’s talks with manufacturers come as EU seems to be moving away from AstraZeneca and J&J – (FT)

– J&J Covid-19 Vaccine Pause Driven by Risk of Mistreating Blood Clots; Officials decided that strong action was needed to alert the public, doctors to unusual cases and their nonstandard treatment – (WSJ)

– Quarantine-Free Travel Starts Between Australia and New Zealand – (Bloomberg)

Exchanges, OTC and Clearing

AMERIBOR Forward Looking Term Rate Affirmed To Meet IOSCO Principles For Financial Benchmarks; AMERIBOR Benchmark Re-Affirmed For Third Year
Mondovisione
/bit.ly/3x1KF6Y

London Stock Exchange owner braces for backlash as advisor urges pay revolt; An influential advisory service has told investors they should vote against David Schwimmer’s pay rise, Sky News learns.
Mark Kleinman – Sky
The odds of a major revolt over the London Stock Exchange Group (LSEG) boss’s pay package have shortened after an influential advisory group recommended opposing it.
/bit.ly/3dqkSxo

Deutsche Börse Venture Network increases reach in Europe: Bulgarian Stock Exchange becomes new partner
Deutsche Börse
The Deutsche Börse Venture Network is expanding its offering in Central and Eastern Europe: Bulgarian startups can now become members of the Deutsche Börse Venture Network at an early stage and position themselves better vis-à-vis international investors and interest groups in one of Europe’s leading start-up networks. This is made possible by a partnership between the Bulgarian Stock Exchange (BSE) in Sofia and the pre-market platform of Deutsche Börse.
/bit.ly/32omL7w

Exchange Publishes Consultation Paper on Review of Corporate Governance Code and Related Listing Rules
HKEX
Exchange seeks comments on proposals to enhance Corporate Governance Code; New proposals include new diversity requirements to end single-gender boards among listed issuers
The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), today (Friday) published a consultation paper (Consultation Paper) outlining proposed enhancements to the Corporate Governance Code and Corporate Governance Report (the Code), as well as related amendments to the Listing Rules.
/bit.ly/2P7bFRm

More News
– Deputy British High Commissioner Engages Capital Market Stakeholders – (NationalAccordNewspaper.com)

– Bergen Carbon Solutions lists on Euronext Growth; Nok 80 Million Raised – Market Capitalisation Of Nok 380 Million – (Euronext)

– Norsk Solar lists on Euronext Growth; Nok 110 Million Raised – Market Capitalisation Of Nok 710 Million – (Euronext)

– Amendments to NYMEX/COMEX Rule 703.A. (“Conditions of Approval”) of NYMEX/COMEX Chapter 7 (“Delivery Facilities and Procedures”) – Responsible Sourcing for NYMEX Platinum and Palladium and COMEX Silver – (CME Group)

– SGX welcomes Econ Healthcare (Asia) Limited to Catalist – (SGX)

– DGCX’s launches Pak rupee futures contract – (Khaleej Times)

Fintech

This startup is working on a chip to save traders precious microseconds using AI; In the unfathomably fast realm of high-frequency trading, a South Korean startup’s plan to build a microchip that speeds markets up by a few microseconds is bound to get some attention.
Bloomberg
In the unfathomably fast realm of high-frequency trading, a South Korean startup’s plan to build a microchip that speeds markets up by a few microseconds is bound to get some attention. The company, Rebellions Inc., was set up six months ago in Seoul by Park Sunghyun, who used to work as a quant developer at Morgan Stanley in New York, with two partners. The chip they’re developing aims to run artificial intelligence more efficiently, which could cut precious millionths of a second off the reaction times of automatic-trading machines.
/bit.ly/32qgAQh

LiTDX: FinTech of the Year 2020 – OpenFin
Annabel Smith – The Trade
Following an industry-wide vote, OpenFin won the FinTech of the Year award as part of LiTDX. Here, CEO of OpenFin Europe, Adam Toms, talks to Annabel Smith about the role FinTech has played during the global pandemic.
/bit.ly/3tvTJ1v

Revolut’s latest funding could result in $10bn valuation
Joanna England – Fintech Magazine
Revolut, one of the UK’s top three challenger banks, is reportedly planning a new funding drive that could see the fintech reach a valuation of more than $10bn. According to Sky News, Revolut’s founders, Nikolay Storonsky and Vlad Yatsenko are aiming to collaborate with FT Partners, the US-based fintech investment bank, which will advise Revolute on the new funding drive schedule to take place in Q3. Although sources say the process is not yet in motion, investors in Revolut have anticipated its raised valuation to hit at least $10bn – with a top speculative figure of $15bn. The new funding drive would make Revolut’s founders multibillionaires.
/bit.ly/3spUnfO

Fintech IPOs: Four foundational keys to success
Sandeep Gupta and Kirby Rattenbury – Fintech Magazine
It’s a fascinating time for fintech. The virtual-first environment has accelerated the adoption of many of the industry’s innovations, while a significant amount of money is up for grabs in the capital markets. More and more fintech companies are considering pursuing a public listing via an initial public offering, a special-purpose acquisition company, or a direct listing. Of course, this entails rock-solid financial and operating processes and practices – table stakes for any company looking to go public.
/bit.ly/3nbkOFb

How The Cloud Is Changing Fintech
Dmitry Dolgorukov – Forbes
The 2020s are the era of the cloud. Not only are more organizations moving their infrastructure to the cloud, but over 55% say they are using multiple public clouds, according to the 2020 IDG Cloud Computing Study. And a sizable slice of companies’ IT budget (32%) is dedicated to this purpose. With purported benefits such as accessibility, ease of use and fast deployment, it’s not hard to see why businesses are drawn to this relatively new technology. But what does this mean for fintech?
/bit.ly/3e7Evcw

LiTDX: FinTech of the Year 2020 – OpenFin
Annabel Smith – The Trade
Annabel Smith: How does it feel to win the LiTDX FinTech of the Year 2020 award?
Adam Toms: We at OpenFin feel honoured to have won the FinTech of the Year 2020 award. OpenFin is the operating system (OS) of finance, an open and collaborative platform for the industry to be more successful. We are building for the industry and that has always been our goal. To be recognised in an industry vote is fantastic.
/bit.ly/3tvTJ1v

Goldman invests £50m in UK digital bank Starling; Start-up lender aims to boost growth ahead of targeted initial public offering
Nicholas Megaw – FT
Goldman Sachs has invested £50m in UK digital bank Starling, as the start-up looks to ramp up growth and bring in significant investors ahead of an eventual initial public offering.
/on.ft.com/2QzVxbs

More News
– Founder of Adobe And Developer of PDFs Dies At Age 81 – (Associated Press)

Cryptocurrencies

Wall Street Bets allows members to discuss select cryptocurrencies on its Reddit forum after years of limiting posts on digital assets
Shalini Nagarajan – Insider
Wall Street Bets, the Reddit forum that kickstarted GameStop’s epic trading frenzy, is allowing its members to exchange views on some cryptocurrencies, according to a recent moderator post. The subreddit has a “No Cryptocurrency” rule, listed as part of a content guide, that limits posts solely tied to cryptocurrencies or the technology they run on. Some other rules include “No Pump & Dump” and “No Market Manipulation.”
/yhoo.it/3e2VhK0

Coinbase Hangover Rattles Crypto Assets With Bitcoin Falling
Shamim Adam and Emily Barrett – Bloomberg
Bitcoin sinks as much as 15% days after record; pares losses; Other coins plunge by double-digits; Dogecoin resumes climb
The mania that drove crypto assets to records as Coinbase Global Inc. went public last week turned on itself on the weekend, sending Bitcoin tumbling the most since February.
/bloom.bg/2Qf5Dyn

Bitcoin’s Green Haven Is Running Out of Surplus Electricity
Ragnhildur Sigurdardottir, Lars Paulsson, and Jesper Starn – Bloomberg
Clean Nordic Power available for Nordic mining set to dwindle; Electricity needed to mine Bitcoin surged 66-fold since 2015
The Nordic region is losing its edge in green Bitcoin mining, just as the industry faces growing scrutiny for its carbon emissions and everyone from Elon Musk to mom-and-pop investors pile in.
/bloom.bg/3duZze5

Coinbase CEO Sold $291.8M in Shares on Opening Day
The amount represents roughly 1.5% of his holdings.
Kevin Reynolds – Coindesk
Coinbase insiders and investors sold about $5 billion in shares in total during the leading cryptocurrency exchange’s first day of trading on the Nasdaq earlier this week, according to a series of filings made Friday with the U.S. Securities and Exchange Commission.
/bit.ly/3n0vGVX

Retail Traders Drove Bitcoin Higher Leading Up to Coinbase Listing, Data Shows; “The whale entities chart could show that smaller retail investors are purchasing bitcoin, and large holders are selling into that rally,” one hedge fund CEO said.
Omkar Godbole – Coindesk
Bitcoin’s price rally in the days leading up to Coinbase’s hotly anticipated debut on the Nasdaq this week was largely driven by retail traders eager to get in on the action while whales were happy to take their money and swim away, blockchain data shows.
/bit.ly/3mWnMgz

What is Dogecoin? How a joke became hotter than bitcoin
David Goldman – CNN Business
Dogecoin is the hottest, quirkiest cryptocurrency on the planet. The total value of the dogecoins in circulation is nearly $50 billion — not bad for a digital currency that started as a joke.
It is the No. 5 most-valuable cryptocurrency on the market, according to CoinMarketCap, having increased more than 6,000% this year.
/cnn.it/3mXHcBD

How Cryptocurrency Will Transform The Future Business Forever
Mike Swigunski – Forbes
If you haven’t quite yet warmed up to the idea of cryptocurrency, you are in good company. Only an estimated 15% of Americans currently own some form of digital currency like Bitcoin or Ethereum. A large portion of these investors has bought in over the past two years. Regardless of your investment stance, there is a strong possibility that cryptocurrency will be impacting you and the future of business transactions.
/bit.ly/3dwrISa

Crypto Is Minting Lobbyists; A growing web of trade groups aims to influence policies that will aid (or squash) the digital gold rush.
Ephrat Livni – NY Times
A week before Coinbase made its blockbuster debut on Wall Street on Wednesday, the cryptocurrency exchange was part of a much quieter, but symbolically important, launch — in Washington, D.C. Yep, here come the lobbyists.
/nyti.ms/32qUnl8

Dogecoin Frenzy Overloads Robinhood Crypto Order System
Joanna Ossinger and Vildana Hajric – Bloomberg
Coinbase’s listing offered momentum to the whole asset class; Binance Coin, Dogecoin surge amid broad digital-money interest
The frenzy around digital tokens is taking its zaniest turn yet in the price of a token created as a joke, buckling the crypto trading system at Robinhood Markets. Dogecoin, boosted by the likes of Elon Musk and Mark Cuban, rallied more than 110% Friday before dropping by 26% on Saturday, according to CoinMarketCap.com. It now has a market value of more than $36 billion and is still up 13,400% from a year ago, when it traded for $0.002 and was worth about $250 million.
/bloom.bg/3sxFLLg

SEC Causing ‘Confusion’ Over Digital Currencies in Legal Case With Ripple: WSJ Editorial Board
Jamie Crawley – Coindesk
The Wall Street Journal’s editorial board criticized the U.S. Securities and Exchange Commission (SEC) for causing “confusion” over its approach to cryptocurrency in an editorial. Regulators are “creating danger” for retail investors as exemplified by the SEC’s lawsuit against Ripple over its alleged issuance of native currency XRP as an unregistered security, according to the WSJ.
/yhoo.it/2QDhiqR

Bahamas Tops China in Ranking of Central Bank Digital Currencies
Joanna Ossinger – Bloomberg
Cambodia takes #2 in retail digital currency project maturity; Most efforts globally use blockchain as underlying technology
Mainland China is third behind the Bahamas and Cambodia in a ranking of the maturity of central banks’ retail digital currency projects, according to a report from PwC.
/bloom.bg/3n1CrXz

Coinbase listing is a lament for some bitcoin believers; Purists believe platform has forsaken crypto’s true principles
Izabella Kaminska – FT
For all those bitcoin true believers who survived the crypto winter of 2017-2020 with their holdings intact, the listing of digital currency exchange service Coinbase must have felt a vindication.
/on.ft.com/3akuOqo

More News
– Crypto’s Coming of Age May Kill the Bitcoin Bubble; Coinbase is being taken as a sign of the industry’s maturity; that’s another way of saying that excitement has passed its peak. – (Bloomberg)

Politics

Trudeau to Pile on Record Debt Steering Canada Out of Pandemic
Kait Bolongaro and Theophilos Argitis – Bloomberg
Spending-heavy budget could be prelude to national election; Childcare and green initiatives top list of Liberal priorities
Justin Trudeau is set to unveil a vision for Canada’s post-pandemic recovery that will double as an election platform, heavy on new spending and assurances the mounting debt is affordable.
/bloom.bg/3v4C9lx

SIFMA Welcomes Introduction of the LIFT Act
SIFMA
SIFMA today issued the following statement from president and CEO Kenneth E. Bentsen, Jr. on the introduction of the Local Infrastructure Financing Tools (LIFT) Act:
/bit.ly/3n0wWs9

EU split over delay to decision on classing gas as green investment; Brussels impasse over whether fuel should be classified as partially sustainable
Mehreen Khan – FT
The European Commission is split over whether to postpone a decision on classifying gas generated from fossil fuels as green energy under its landmark classification system for investors.
/on.ft.com/3mY3Ytf

Wirecard inquiry: Germany’s political and financial elite exposed; The investigation into corporate fraud reaches a climax with Merkel and Scholz to appear before MPs
Guy Chazan and Olaf Storbeck – FT
It was an innocuous question, posed shortly before midnight some nine hours into an exhausting parliamentary hearing into the Wirecard scandal.
/on.ft.com/2RI5bZX

Why Political Sectarianism Is a Growing Threat to American Democracy; The country is increasingly split into camps that don’t just disagree on policy and politics — they see the other as alien, immoral, a threat. Such political sectarianism is now on the march.
Nate Cohn – NY Times
American democracy faces many challenges: New limits on voting rights. The corrosive effect of misinformation. The rise of domestic terrorism. Foreign interference in elections. Efforts to subvert the peaceful transition of power. And making matters worse on all of these issues is a fundamental truth:
/nyti.ms/3x5ubdZ

U.S. Sanctions Squeeze Russia’s Bonds Despite Economic Strength; Diplomatic campaign in response to alleged cyberattacks and election interference is raising borrowing costs for Russian government
Matt Wirz – WSJ
Russia’s markets reacted modestly to U.S. sanctions last week, but the country’s bonds have been weakening for months, indicating that for investors, geopolitical pressure is outweighing the country’s economic strength.
/on.wsj.com/3tyBBEa

How Corporate Donations Changed After the Capitol Riot; New fund-raising disclosures show a shift in giving.
Andrew Ross Sorkin, Jason Karaian, Sarah Kessler, Michael J. de la Merced, Lauren Hirsch and Ephrat Livni – NY Times
Corporate campaign donations, a quarter later
After the January 6 riot at the Capitol, scores of companies vowed to pause their political donations. Some stopped giving to all politicians, while others shunned only those 147 Republicans who voted to overturn the presidential election results. A recent deadline for candidates to release fund-raising details for the first quarter revealed more details about how corporate giving has changed.
/nyti.ms/3mXHfNV

More News
– Treasury Puts Taiwan on Notice in Currency Report but Strikes Measured Tone – (NY Times)

– Treasury Releases Report on Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States – (U.S. Department of Treasury)

Regulation

Biden Pick Gary Gensler Is Sworn In as SEC Chairman
Erik Wasson and Benjamin Bain – Bloomberg
Former CFTC chair takes reins as Wall Street’s top cop; Archegos, GameStop fallout seen as early Gensler challenges
Gary Gensler was sworn in Saturday to be chairman of the Securities and Exchange Commission, where he’ll be President Joe Biden’s top cop on Wall Street. Maryland Democratic Senator Ben Cardin swore in Gensler, 63, at a ceremony in Baltimore, the new chairman’s home town, three days after the Senate approved his nomination on a 53-to-45 vote.
/bloom.bg/3eh0jCE

Gary Gensler Sworn in as Member of the SEC
SEC
Gary Gensler was sworn into office today as a Member of the Securities and Exchange Commission by U.S. Senator Ben Cardin. He was nominated to Chair the SEC by President Joseph R. Biden on February 3, 2021 and confirmed by the U.S. Senate on April 14, 2021.
/bit.ly/3ai1Ffi

Joel R. Levin, Director of Chicago Regional Office, to Leave SEC
SEC
The Securities and Exchange Commission today announced that Joel R. Levin, the Director of its Chicago Regional Office, will leave the agency at the end of May.
/bit.ly/3drwj7X

SIFMA Statement on Preserving Securities Arbitration
SIFMA
SIFMA released the following statement from Kenneth E. Bentsen, Jr., SIFMA president and CEO on legislation introduced today that would ban arbitration clauses in all consumer contracts, including the retail contracts of investors who utilize the services of broker-dealers:
/bit.ly/3tzbD3I

SEC Reopens Comment Period for Universal Proxy
SEC
The Securities and Exchange Commission today voted to reopen the comment period on the proposed rules for the use of universal proxy cards in all non-exempt solicitations for contested director elections.
/bit.ly/3mYc70A

ECB cracks down on deficiencies in big banks’ risk modelling; Central bank says lenders should invest in the models they use to determine the riskiness of assets
Martin Arnold – FT
The biggest eurozone banks have repeatedly been too optimistic in their risk-modelling, the European Central Bank said as it presented the results of a five-year review that has wiped out a chunk of their capital ratios.
/on.ft.com/32rhBaL

UK scraps MiFID II requirements in ambitious capital markets reform; Proposed reforms to the UK capital markets include the removal of the share trading obligation and the controversial double volume caps for dark trading.
Annabel Smith – The Trade
Chancellor Rishi Sunak has set out plans to scrap certain MiFID II requirements in an ambitious plan to reform the UK’s capital markets regime following Brexit. The proposed changes announced by the HM Treasury on 19 April include the removal of several MiFID II restrictions inherited from Europe such as the share trading obligation (STO) and the double volume caps (DVC) related to dark pool trading.
/bit.ly/3n0PHMr

Nausicaa Delfas’s appointment as Interim Chief Executive and Chief Ombudsman of Financial Ombudsman Service
UK FCA
The Financial Ombudsman Service has today announced that Nausicaa Delfas, Executive Director of International and interim Chief Operating Officer, has been appointed as the organisation’s interim Chief Executive and Chief Ombudsman. Nausicaa will take up the role in mid-May.
/bit.ly/32Ftni5

More News
– ASIC secures 20-year ban for Mayfair 101 director James Mawhinney from fundraising and promoting investment products – (ASIC)

– FCA makes key sustainability and technology hires; We have appointed Sacha Sadan as Director of Environment Social and Governance. – (UK FCA)

– RegTech Industry Backs FCA Calls For ‘Purposeful’ AML Policies -(Mondovisoine)

Investing and Trading

WeWork’s New Stock-Listing Plan Has Echoes of Its Past; Shared office-space company is touting fast future growth and high profitability
Jean Eaglesham and Eliot Brown – WSJ
WeWork, which had one of the most spectacular IPO implosions in recent years, is trying to go public again—and some of the factors that worried regulators on the first deal are back again. WeWork isn’t doing an initial public offering this time, but merging with a special-purpose acquisition company, or SPAC. Rules around SPACs are looser than for IPOs, giving WeWork more leeway to tout its future.
/on.wsj.com/3aiD9KT

SPAC Wipeout Is Punishing Followers of Chamath Palihapitiya
Brandon Kochkodin – Bloomberg
Equal-weighted basket of his SPACs has underperformed index; Clover Health investment hampered by SEC investigation
Just as Chamath Palihapitiya was the face of the SPAC frenzy that gripped financial markets at the start of the year, he is today the face of the bust. All six of Palihapitiya’s Social Capital Hedosophia-linked blank-check companies, including three that already completed mergers, have plunged more than the broader SPAC market since it hit its peak in mid-February. One of them — Virgin Galactic Holdings Inc., a space tourism business that’s backed by Richard Branson — is down more than 50%. All of these losses are greater than the 23% average decline in SPACs, as measured by the IPOX SPAC Index, over that time.
/bloom.bg/3uVBHGc

Historic Oil Glut Amassed During the Pandemic Has Almost Gone
Grant Smith and Julian Lee – Bloomberg
About a fifth of stockpile surplus remains as of February; Tightening has propped up prices, concerns consumers
The unprecedented oil inventory glut that amassed during the coronavirus pandemic is almost gone, underpinning a price recovery that’s rescuing producers but vexing consumers.
/bloom.bg/2RNmpFp

Stock Market Thrill Ride Is Breaking Bonds’ Grip on Mom and Pop
Lu Wang – Bloomberg
Equity inflows spark talk about big shift in asset allocation; Risk tolerance seen playing a key role in investor decisions
Besides enriching Reddit traders and making the stock market front-page news again, the world’s cultural obsession with risk-on assets is doing something that has almost never happened in the past three decades. Turning bonds into an also-ran.
/bloom.bg/2QdyDXs

Tesla Runs on Faith, Exxon Runs on Discipline. Only One Is Right; CEOs Elon Musk and Darren Woods have incompatible visions and styles that belie their companies’ similar belief premiums.
Liam Denning – Bloomberg
The future of energy boils down to the competing visions of a self-styled Technoking and a man so low-profile that Wikipedia isn’t sure which year he was born. Elon Musk, the chief executive officer of Tesla Inc., and Darren Woods, his counterpart at Exxon Mobil Corp., could hardly be more different. Musk’s symbiosis with the publicity industry drives much of the conversation around Tesla’s electric vehicles as well as his other ventures, from rockets and neural implants to tunnel-boring machines and the odd flamethrower. Woods’s most headline-grabbing gesture so far was the time he showed up to an earnings call.
/bloom.bg/3dt1xLR

Traders turn to tried and tested algo strategies in market volatility; As the percentage of funds trading via algos continued to rise, the long-only results of The TRADE’s Algorithmic Trading Survey 2021 reveal that traders relied on tried and tested VWAP and TWAP strategies during the market uncertainty.
Editors – The Trade
2020 was a wild year for global equity markets and that is putting it mildly. After investors watched on in horror last March as the dramatic sell-off in markets seemed to spell financial Armageddon, it did not take too long for central banks and governments to realise the seriousness of the situation. An enormous program of bond-buying and rate cuts set the stage for a series of record-breaking rallies and heightened equity market activity as companies looked for financing and restructuring solutions.
/bit.ly/3dwdhgN

Quick-Fire Dealmakers Are Fueling a $129 Billion Buyout Boom
Jan-Henrik Foerster – Bloomberg
Firms move quickly to strike deals amid fierce competition; Record amount of dry powder, cheap credit boost spending power
It took Ardian SAS just two days in February to buy German laboratories company GBA Group. That’s fast work even in a year when some of the biggest auctions, including the multibillion-dollar sales of software firm Unit4 NV and laboratories group Cerba HealthCare, have been sealed in double-quick time, according to half a dozen buyout executives and advisers.
/bloom.bg/3gke3z9

More News
– Palladium prices hit a record as rally extends into a 6th straight year – (MarketWatch)

-GameStop chief executive to step down; George Sherman is expected to go by July 31, depending on when a successor is in place – (FT)

Environmental, Social and Corporate Governance

Criticism of carbon offsets doesn’t acknowledge changes to how projects are approved, monitored; Properly managed carbon offset credits can play a significant role in reducing Canada’s emissions
Geoff Stiles – CBC News Opinion
There has been a lot of criticism lately about the use of carbon offsets in Canada’s Output-Based Pricing System (OBPS). Much of it is misplaced, ignoring the advances made in using offset credits to reduce emissions effectively and sustainably. With a few minor improvements, Canada’s use of offset credits could be a significant part of the country’s efforts to meet its Paris Agreement commitments.
/bit.ly/3e8Kgqy

Gas Is the New Coal With Risk of $100 Billion in Stranded Assets
Rachel Morison – Bloomberg
Cost of renewables has dropped, making gas less competitive; Some executives report struggle to sell gas-fired facilities
Natural gas is falling out of favor with emissions-wary investors and utilities at a quicker pace than coal did, catching some power generators unaware and potentially leaving them stuck with billions of dollars of assets they can’t sell.
/bloom.bg/3uUtqT0

Bond Giant Pimco Attempts to Change Its Culture; Recent lawsuits have brought new scrutiny to the money manager’s dog-eat-dog environment
Justin Baer – WSJ
For years, money manager Pacific Investment Management Co. wore its cutthroat reputation as a badge of honor. Ambitious young people have long flocked to Pimco’s Southern California trading floor with dreams of working alongside some of the bond market’s brightest investors. They might endure sharp elbows, long hours and fickle management decisions on their way to the top, but the dazzling paydays made it all worthwhile.
/on.wsj.com/3svJ9WY

Banks Face Growing Pressure to Phase Out Fossil-Fuel Lending
Alastair Marsh – Bloomberg
Investors managing $11 trillion have called on the world’s biggest banks to phase out financing of fossil-fuel companies and throw their weight behind the goals of the Paris climate agreement.
/bloom.bg/32rFuPr

Coalition of big investors pushes banks to defund carbon emitters; Group managing $11tn in assets call for financing to be linked to zero emissions goal
Attracta Mooney and Stephen Morris – FT
Goldman Sachs, HSBC, BNP Paribas and 24 other global banks are coming under pressure from a coalition of large investors to stop financing carbon-intensive projects and to scale up their green lending.
/on.ft.com/2P0lIHI

Rush for carbon credits spurs surge in power company schemes; Questions raised over climate impact of offsets generated by projects that are already well-funded
Camilla Hodgson – FT
A rush by companies to buy credits to offset carbon emissions has led to contentious schemes being developed by large power companies including India’s Adani Group and US-based NextEra Energy.
/on.ft.com/3svb75e

Loan Markets Are Pricing In Climate Transition, Penalizing Coal
Alastair Marsh – Bloomberg
Credit markets are starting to price in the transition to a low carbon economy. New research from Oxford University that analyzes changes in loan spreads — a measure of credit risk — found the cost of financing renewable energy projects shrunk dramatically over the past two decades, while the opposite was true for coal, the most carbon-intensive of the fossil fuels.
/bloom.bg/3xaZYKG

More News
– BP Wants to Stop Burning Off Gas in America’s Top Oil Field – (WSJ)

– Shell, Exxon Look to Profit From Capturing Customers’ Carbon Emissions; Big oil companies are exploring charging for carbon storage, hoping to benefit from the drive to reduce emissions – (WSJ)

– Landmen Who Once Staked Claims for Oil and Gas Now Hunt Wind and Sun; The slumping petroleum industry is shifting work from securing drilling rights to lining up properties for wind turbines and solar panels. But the landman profession is shrinking. – (WSJ)

– Princeton Gets $20 Million From Bloomberg Philanthropies Toward Diversity; Ivy League school aims to boost support for first-generation and low-income students while helping other schools with their programs – (WSJ)

Institutions

Bank of America to Set Record for Largest Bank Bond Sale at $15 Billion
Jack Pitcher and Brian W Smith – Bloomberg
Bank of America Corp. is poised to sell $15 billion of bonds, setting a fresh record for the largest bond sale by a bank just a day after rival JPMorgan Chase & Co. sold what was then the biggest such offering, according to data compiled by Bloomberg.
/bloom.bg/3am4QTr

Citigroup Refocuses Asia Strategy as It Pulls Back From Consumer Banking; The New York-based bank is planning to hire 2,300 people and expand assets under management to $450 billion in Asia
Jing Yang – WSJ
As Citigroup Inc. C -0.12% moves to shed most of its consumer banking operations across Asia, it is planning to scale up what it sees as a more-lucrative endeavor: serving the rising number of wealthy entrepreneurs and their businesses in the region.
/on.wsj.com/32s0wxy

Big Banks Rake in Record Profits as Stimulus Props Up Consumers
Lananh Nguyen – Bloomberg
Firms release billions set aside for loans that never soured; Consumer is ‘healthiest we have seen’ after a crisis: Fraser
The U.S. government piled trillions of dollars of emergency funds into Americans’ accounts during the pandemic. That’s boosting the bottom lines of the banks that store their cash.
/bloom.bg/3mZtlL3

Mike Mayo Blasts Morgan Stanley for Secrecy Over Archegos Hit
Sridhar Natarajan – Bloomberg
Mayo: The bank compounded mistakes by delaying information; Record revenues at the firm irrelevant to decision, Mayo says
The roar of Morgan Stanley’s record quarter is being drowned out by its prolonged silence over a near billion-dollar loss from the Archegos collapse — and that’s inviting a tongue-lashing from the most outspoken Wall Street analyst.
/bloom.bg/3dtYtiy

HSBC Top Staff to Hot Desk at HQ as Bank Scraps Executive Floor
Denise Wee – Bloomberg
Bank has turned offices on the 42nd-floor into meeting rooms; HSBC eventually plans to shrink its property footprint by 40%
HSBC Holdings Plc has scrapped the executive floor of its Canary Wharf headquarters in London and turned the private offices of its top staff into client meeting rooms and collaborative spaces.
/bloom.bg/3uYvXvu

ABN Amro Sees Quarterly Loss After $574 Million Settlement
Joost Akkermans – Bloomberg
Probe found shortcomings in anti-money laundering processes; CEO Swaak says settlement marks end of ‘painful’ episode
ABN Amro Bank NV agreed to pay 480 million euros ($574 million) to end a Dutch investigation that found “serious shortcomings” in the lender’s processes to combat money laundering.
/bloom.bg/3spHPoI

JPMorgan forced out trader who cooperated with fed probe: lawsuit
Kathianne Boniello – NY Post
JPMorgan Chase treated indicted employees better than an executive who cooperated with federal investigators, according to a lawsuit. Commodities trader Donald Turnbull claims in court papers he was abruptly canned from the bank’s precious metals trading group as soon as JPMorgan execs discovered the extent of his cooperation with the U.S. Department of Justice. Ultimately, the DOJ indicted six JPMorgan traders in 2019 for spoofing, or market manipulation through creating fake supply and demand.
/bit.ly/3swRwS4

Danske Bank CEO Quits Amid Dutch Probe of Laundering Allegations
Frances Schwartzkopff and Joost Akkermans – Bloomberg
Dutch investigations haunt former ABN Amro, ING executives; ABN Amro to post quarterly loss after settling Dutch case
Danske Bank A/S is replacing Chris Vogelzang as chief executive officer after a Dutch money-laundering investigation implicated the former ABN Amro Bank NV executive, complicating the Danish lender’s efforts to get past its own scandal.
/bloom.bg/2QgsGc7

Credit Suisse’s New Chair Horta-Osorio Faces Toughest Crisis Yet
Stefania Spezzati – Bloomberg
Outgoing Lloyds chief executive to join Swiss lender in May; Credit Suisse is grappling with Archegos and Greensill fallout
The last time Antonio Horta-Osorio started a new job, he was plunged into the middle of a crisis roiling Britain’s biggest mortgage lender. Ten years later, he’s facing an even tougher challenge.
/bloom.bg/3alrZVK

More News
-Citi Plans New China Investment Bank Within 18 Months – (Bloomberg)

– Vanguard launches price war in UK pensions market; World’s second largest asset manager unveils low-cost retirement advice service – (FT)

– Robotics ETFs hit by ‘massive’ outflows in March; Sharp reversal has hit Europe hardest with assets falling 8.5% to $5.4bn – (FT)

Regions

EXCLUSIVE China’s Ant explores ways for Jack Ma to exit
Julie Zhu – Reuters
Ant Group is exploring options for founder Jack Ma to divest his stake in the financial technology giant and give up control, as meetings with Chinese regulators signaled to the company that the move could help draw a line under Beijing’s scrutiny of its business, according to a source familiar with regulators’ thinking and two people with close ties to the company.
/reut.rs/2QB0fWe

Bob Diamond’s African Bank Exits Another Market With Botswana Deal
Emele Onu – Bloomberg
Atlas Mara Ltd.’s footprint in Africa is shrinking by another country. The African banking group started by former Barclays Plc Chief Executive Officer Bob Diamond agreed to sell its stake in African Banking Corporation Botswana to Nigeria’s Access Bank Plc, according to statements on Monday. The deal marks the second transaction between Atlas Mara and Nigeria’s biggest lender, which agreed to buy its Mozambique unit last September.
/bloom.bg/2OZiC6M

China’s Retail Investors Fall Out of Love With Mutual Funds
Bloomberg News
April set for worst month for fund launches since Oct. 2019; Just 26 new funds were issued as of April 14, according to UBS
China’s retail investors are quickly cooling their enthusiasm for mutual funds. New issuance of equity and mix-allocation funds – the latter also mostly exposed to stocks – has fallen to 16.4 billion yuan ($2.5 billion) in the two weeks through April 14, according to UBS AG data. That’s less than 10% of the amount raised in March and puts April on track to be one of the worst months for fund launches in well over a year.
/bloom.bg/32Fi8Gp

Rio Tinto copper chief quizzed on payments to Mongolian citizens; Miner starts discussions over future of most important project
Neil Hume – FT
The head of Rio Tinto’s copper business faced tough questions from politicians in Mongolia after he arrived in the country for discussions over the future of the miner’s most important project.
/on.ft.com/2Qe68c8

London Needs A Tech IPO Hit To Forget Its Deliveroo Debacle; A listing of cybersecurity firm Darktrace has to go well if the city hopes to attract more high-growth tech startups.
Alex Webb – Bloomberg
London is finally getting a proper test of its appetite for loss-making, high-growth technology stocks. The impending initial public offering of cybersecurity startup Darktrace Plc fulfills many of the criteria that much-hyped Deliveroo Holdings Plc didn’t, but investors are still being asked to overlook some issues that would likely be less of a concern in the U.S.
/bloom.bg/3ejodO9

More News
– Champagne and steak back on menu as City reopens for business; Early signs of life have given authorities hope that financial district can bounce back – (FT)

Brexit

Irish trucks taking route around the UK to avoid Brexit red tape
Jonathan Keane – CNBC
As the EU adjusts to its new relationship with the U.K. after Brexit, fewer freight trucks are making the trek across the Irish Sea.
For decades, the route through the U.K. (called a land bridge that takes approximately 15 hours) has been a vital and reliable artery for getting goods from Ireland to mainland Europe.
/cnb.cx/3svjHBc

Cargo volumes plummet at Dublin Port due to Brexit effect
Eoin Burke-Kennedy – The Irish Times
Brexit triggered a major reduction in cargo volumes at Dublin Port in the first quarter of this year. The Dublin Port Company said trade volumes fell by 15.2 per cent in the first three months of 2021.
/bit.ly/2QFXMtu

Northern Ireland: Did anyone warn about Brexit border checks?
Chris Morris – BBC News
The recent street protests among loyalist communities in Northern Ireland have been sparked by a series of complex factors, and Brexit is part of the mix. “I recognise there are concerns about the implications around the Northern Ireland protocol,” Northern Ireland Secretary Brandon Lewis told MPs on 13 April. The protocol, part of the December 2019 deal that took the UK out of the EU, keeps Northern Ireland following many of the rules of the EU single market. That fact is what creates the checks on goods moving from Great Britain into Northern Ireland, and other border bureaucracy, which many loyalists bitterly oppose.
/bbc.in/2Q5WB73

Brussels Brexit chief calls for ‘good faith’ as relations with UK improve
Jim Brunsden, Michael Peel, and Laura Noonan – FT
The EU’s Brexit chief has said he is convinced solutions can be found to “minimise” the disruption of Brexit on Northern Ireland, calling for a “good faith” approach to applying new trading rules in a way that can reduce tensions. Maros Sefcovic, the EU commission vice-president in charge of Brexit, told the FT he believed discussions with the UK could yield approaches that protect the EU market from illicit entry of goods and reduce problems for people and businesses in Northern Ireland — although he also stressed there needed “to be an effort from both sides”.
/on.ft.com/3v5tT4K

Miscellaneous

Whisky world at war as tech allows spirits to be ‘aged’ instantly; Brands that speed up the ageing process with heat, light and reactors have upset traditional barrel-agers
Judith Evans – FT
In HG Wells’s 1901 short story “The New Accelerator”, a scientist invents a potion that enables anyone who drinks it to move through time considerably faster than normal, travelling long distances in what others perceive as just a fraction of a second.
/on.ft.com/3swaLLV

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