John Lothian Newsletter: CME Group, LCH.Clearnet offer new margining solutions; ASX Chairman Gonski to Step Down, Manage Australia SWF; SGX Adds Trading Hubs in London, Chicago

Mar 14, 2012

CME Group (on Tuesday) and LCH.Clearnet (on Wednesday) each debut new solutions to allow clients to margin their positions in a more cost-effective way. The chairman of the ASX quits his job to take on a new role of managing a big chunk of Australia’s sovereign wealth fund. SGX teams up with Eurex and NYSE Technologies to interconnect trading networks. In today’s super-heavyweight Boca edition of the JLN, you’ll also find stories about Walt Lukken as a plumber; analysis of the effects of MF Global on the futures industry; major new product and service offerings from CBOE, Trading Technologies, ISE and others; the list of directors freshly elected to the FIA; FX commentary from Doug Ashburn on the value of bank stress tests; and an interview from JLN Metals with Jean Lucas, president of Women in Mining Canada. And lots more.

Observations – Statistics – Commentary

The rise of the derivatives technocrats
Tom Osborn – Financial News
“I’m a plumber, and I’m proud of it,” Walt Lukken, the new president of the Futures Industry Association, told assembled global media at the opening of the derivatives trade body’s annual conference in Boca Raton, Florida yesterday, likening his new job to a man who has been brought in to “unclog” a few blockages and fix a few leaks.
http://jlne.ws/xMo1h5

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Rising Costs and Risks Threaten Futures Brokers, DeWaal Says
By Matthew Leising – Bloomberg
Changes to how clearinghouses are used to back derivatives trades are putting brokerages on “a dangerous path” that threatens the futures business model, said Gary DeWaal, general counsel of Newedge USA LLC.
http://jlne.ws/wMEWCw

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MF Global Won’t Permanently Damage Futures Industry – FIA
By Jacob Bunge Of Dow Jones Newswires
The head of the main lobby group for the futures industry predicted Tuesday that the business will overcome the reputational damage suffered by the collapse of MF Global Holdings, one of its main players.
http://jlne.ws/wcN6PT

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Lines Between Futures, Swaps Will Become Blurred, Say Derivatives Experts
Dow Jones
Users of off-exchange derivatives or “swaps” are seen turning to listed futures–or swaps that more closely resemble futures–in select areas as pending regulations increase the costs of trading more complex instruments, panelists at a futures industry conference said Tuesday.
http://jlne.ws/y2tNTY

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FIA Elects Directors and Officers
The Futures Industry Association today announced the election of board directors at its annual meeting in Boca Raton, Fla. Seventeen directors were elected in total at this meeting, including eight regular member directors for two-year terms; four regular member directors for one-year terms; and five associate member directors for a two-year terms. Following the election, the new board elected the association’s officers and public directors.

For a complete list of directors and roles, visit http://jlne.ws/yngTzQ

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Former CFTC chief sees lack of swaps preparedness
By Jacob Bunge – Dow Jones
Many companies that use swap contracts to hedge financial and commodity risks remain unprepared for pending regulations that will tighten practices in the market, a former member of the Commodity Futures Trading Commission said Tuesday. “I’m appalled at the lack of readiness” among so-called end users, said Michael Dunn, a commissioner from 2004 until last October. He said regulators share some blame for not yet detailing key aspects of the planned swap-market overhaul.
http://jlne.ws/Alzysh

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ISE Options Exchange May Open New Venue With Trading Floor
By Nina Mehta – Bloomberg
The International Securities Exchange may introduce a second platform for U.S. equity options, opening what may be the nation’s 10th venue for the contracts, according to Chief Executive Officer Gary Katz.
http://jlne.ws/wdvRBM

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Trading Technologies Releases Milestone Platform Upgrade Featuring X_TRADER Version 7.11 with ADL
Trading Technologies International, Inc. (TT), a leading global provider of software and solutions for professional derivatives traders, today released a groundbreaking upgrade to the TT trading platform, including the flagship X_TRADER order-entry screen and the Strategy Engine (SE) proximity-based execution servers.

The new release of X_TRADER, version 7.11, features ADL (Algo Design Lab), a revolutionary visual programming platform that allows traders and programmers alike to design, test and deploy custom automated trading programs without writing a single line of code. Using drag-and-drop building blocks that offer extensive design flexibility, virtually anyone can construct sophisticated trading programs in a fraction of the time required by traditional manual programming.
http://jlne.ws/ySgAtf

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MBF Clearing Sued by CFTC, Accused of Not Segregating Funds
By Patricia Hurtado – Bloomberg
MBF Clearing Corp. was sued by the Commodity Futures Trading Commission and accused of failing to properly segregate customer accounts from its own funds and of violating the Commodity Exchange Act.
http://jlne.ws/y1a1fw

Broker accused of customer segregation failure
By Gregory Meyer in New York – Financial Times
A broker run by the high-profile US commodities trader Mark B. Fisher has been accused of violating a cornerstone protection of the futures market by failing to properly segregate customer funds.
http://jlne.ws/xmBPtN

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CBOE Introduces “VIX of VIX” Benchmark Index: Provides a Gauge for Measuring Volatility of the VIX Index Itself
The Chicago Board Options Exchange announced today that it began publishing values for the CBOE “VIX of VIX” Index this morning. As its name implies, the CBOE’s VIX of VIX Index tracks the volatility of the CBOE Volatility Index, the world’s most widely-followed market volatility index.
http://jlne.ws/yJo5CV

***JM: I love this so much, I hardly know where to begin. Are the two indexes “VIXen”? Will we be seeing even more dimensions, giving us a VIX of VIX of VIX? Do you say “of”, or do you just say, “VIXaVIXaVIX”? Will the new marketing slogan be, “Be afraid. Be VERY afraid”? Or maybe, “It’s like fear… in 3D!”

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JLN FX: We’ll Take Your Money, But Not Because We Need It
By Douglas Ashburn – JLN

In last week’s column (Connecting the Dots, JLN FX, March 6, 2012), I pointed out that the ECB’s second-round, EUR 530 billion long-term refinancing operation (LTRO) is really Europe’s version of the U.S. Federal Reserve’s TALF and TARP programs from 2008-09. From the column:

“Since the U.S recession predated Europe’s woes by a few years, it is further along the timeline. At this point in the U.S. the market is saying that stimulus is not really a “one-off event” – it must continue, lest the tenuous recovery falter. The current ECB is really the same story, only a couple rounds behind in terms of stimulus. But, as we see in the U.S. case, the economy has a steady pulse, but only while receiving periodic shock treatments.”

Case in point: Europe’s banking institutions are this week taking another page out of the U.S. playbook. Concurrent with the taking of tremendous amounts of emergency funding, the banks make public statements downplaying the need for such funding. Most notably, Deutsche Bank, who had earlier looked down its nose at its weaker brethren that utilized the first-round funding facility, tapped the ECB for up to EUR 10 billion in round two of LTRO. This came after earlier statements saying that Deutsche had never accepted government money, which demonstrated just how strong DB and how it is a source of their competitive advantage..

Credit ECB president Mario Draghi, though, for calling it as he sees it, criticizing such puffery as “statements of virility.”

For the rest of the commentary and daily news from the currency sector, visit the JLN FX website at http://jlne.ws/yq9t8y

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JLN Metals: Five Minutes With Jean Lucas
Jean Lucas is the president of Women in Mining Canada (WIM Canada) and the executive vice president of business development for Ontario-based environmental technology company Eco Waste Solutions. Lucas talked to editor/producer Nicole V. Rohr about WIM Canada’s recent reception at the Prospectors & Developers Association of Canada (PDAC) 2012 conference, and about changes affecting the mining and mineral exploration industries in Canada.

Q: What is the mission of Women in Mining Canada?

A: We are a national not-for-profit organization. We’re strictly focused on addressing the attraction, retention and advancement of women in the mining and minerals sector. There are 12 local Women in Mining branches all over Canada, with another couple set to come online this year. Women in Canada provides the linkage among all these branches… and we have a broader focus that includes advocacy and research. We produce one of the most important pieces of gender research for the mining industry in Canada called RAMP-UP, which is the foundation of our advocacy work.

Q: What are some of WIM Canada’s recent initiatives?

A: We’re really trying to increase the visibility of women in the mining sector, and raise the profile of individuals themselves. We work directly with employers to find solutions [and] launched a new reward program this year, which was revealed at PDAC 2012 where at our reception we had over 800 people this year. It was unbelievable. We announced the new Women in Mining Canada Trailblazer Award, where we recognize women who have made a particular impact on the industry. We’re also planning to have an award to recognize companies, but the first thing we’re going to do is work toward having an annual report card where we’ll report on the progress of companies in the industry and recognize those who are leading the way. The interest in women in mining in general is just growing by leaps and bounds all the time.

For the rest of the interview, visit MarketsWiki at http://jlne.ws/x52x9N

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First-Ever TEDxWallStreet to focus on ‘Redefining Success’ in a challenging world
The first-ever TEDxWallStreet, a not-for-profit event, will convene on March 30 at the New York Stock Exchange where pioneering thought leaders will address a diverse audience of 300 business, social and academic influencers, as well as a global audience via live webcast. The discussion will focus on “Redefining Success,” within the Wall Street community and beyond.
http://jlne.ws/y5SrKe

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FOW’s 4th Annual Derivatives World Latin America 2012
On Monday, April 2nd 2012, FOW’s 4th Annual Derivatives World Latin America will bring together the brightest talent and sharpest minds for a one-day conference looking at the way the derivatives landscape in Latin America is shaping up. This year’s programme includes a wide range of topics from how to access Latin American markets to what new developments in technology across the region means to traders. We will also be analysing trends within individual asset classes as asking how you can profit from them.

For complete details and to register, visit http://jlne.ws/A37uEl

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MarketsWiki Page of the Day
Craig S. Donohue
http://jlne.ws/w8MYNm

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MarketsWiki Recent Updates

People
Jean Lucas; Gil Mandelzis; Craig S. Donohue

Companies, Organizations and Groups
Women in Mining Canada; Eco Waste Solutions; ICAP

Miscellaneous
Job Postings; Five Minutes With Walt Lukken Of FIA; Five Minutes With Jean Lucas; Upcoming Events

Statistics
20,503,677 pages viewed, 6,745 articles, 137,945 edits
MarketsWiki Statistics

Lead Stories

CME to launch new service to cut traders’ margin costs
Reuters
CME Group Inc. said on Tuesday it will on May 7 give banks and other large interest-rate traders a new way to slash the margins they put up to back their trades, in a bid to boost the futures exchange operator’s rate swaps clearing business.
http://jlne.ws/zIR3Bd

LCH.Clearnet plans swaps margining
By Jeremy Grant – Financial Times
LCH.Clearnet, the Anglo-French clearing house, on Wednesday intensified the battle for market share in clearing of over-the-counter (OTC) derivatives by offering a way for big dealers to reduce the cost of trading swaps if they have offsetting positions in exchange-traded derivatives.
http://jlne.ws/xafJ6F

ASX Chairman Gonski to Step Down to Manage Australia Future Fund
Bloomberg
ASX Ltd. (ASX) Chairman David Gonski will step down from his role at Australia’s main stock market operator after being appointed to oversee almost A$90 billion ($95 billion) in the nation’s sovereign-wealth funds.
http://jlne.ws/xMkkAD

Singapore Exchange Adds Trading Hubs in London, Chicago
By Eleni Himaras – Bloomberg
Singapore Exchange Ltd. will create derivative trading hubs in London and Chicago, and offer MSCI Indonesia (MXID) futures as it steps up efforts to become the bourse of choice for Asian trading.
http://jlne.ws/woyq5z

***JM: SGX appears to have saved up a year’s worth of announcements for today. See the “Asia-Pacific News” section, further down, for lots of SGX stories and press releases.

Hong Kong Exchanges: slow build for high-frequency
By Jacob Bunge – Dow Jones
Hong Kong Exchanges & Clearing Ltd. is not rushing to open its markets to high-frequency trading firms, despite their power to drive turnover in stocks and derivatives, according to the company’s chief executive. Rapid-fire electronic trading strategies “ultimately will come” to Hong Kong’s markets, said HKEX CEO Charles Li, but neither the exchange nor regulators are in a hurry to tweak the market’s structure to accommodate them.
http://jlne.ws/wMgSkV

Swaps Users Face Serious Collateral Challenge, Executives Say
By Matthew Leising
Derivatives users will face significant challenges to meet new collateral requirements as the trades are forced into clearinghouses, according to industry executives. Investors have pledged about $200 billion to back futures trades around the world, Bill de Leon, a managing director at Pacific Investment Management Co., said today on a panel discussion at the Futures Industry Association annual conference in Boca Raton, Florida. That amount could be 10 times as large for the majority of trades in the $708 trillion over-the-counter derivatives market, he said.
http://jlne.ws/wzVCT5

Greece Has Ratings Upgraded by Fitch on Distressed Debt Exchange
Bloomberg
Greece had its long-term foreign and local currency issuer default ratings raised to B- with stable outlooks from Restricted Default by Fitch Ratings, which cited the 96 percent participation in the distressed debt exchange.
http://jlne.ws/wEDjjq

In a First, Europeans Act to Suspend Aid to Hungary Unless It Cuts Deficit
By JAMES KANTER – NY Times
European Union finance ministers agreed Tuesday for the first time to punish one of their members for flouting the bloc’s budget rules, deciding to suspend payment to Hungary of nearly 500 million euros in development money next year unless it makes progress on reducing its deficit.
http://jlne.ws/w3CTTQ

Despite Calls for Alternatives, Another American Is Expected to Lead World Bank
By ANNIE LOWREY – NY Times
Once again, the next head of the World Bank will be an American. The White House has not yet announced its nominee to lead the 67-year-old development institution, whose president, Robert B. Zoellick, will step down when his term is over at the end of June. But administration officials said this week that they would pick an American by the March 23 deadline for nominees.
http://jlne.ws/xbTkPx

A hard slog in the foothills of debt
By Martin Wolf – Financial Times
“Deleveraging” is an ugly word for a nasty journey: that towards lowering excessive debt after a credit bubble. What makes the effort particularly difficult now is that it affects the US and other large economies. This is a global, not just a local, event.
http://jlne.ws/xWLzMD

Stress Tests Show How Fed Pushed Banks to Bolster Balance Sheets
By Craig Torres, Cheyenne Hopkins and Ian Katz – Bloomberg
The resilience of the largest U.S. financial firms when tested against a recession more severe than the last one shows regulators have succeeded in pushing banks to build fortress-like balance sheets.
http://jlne.ws/wrmL1j

U.K. May Revive Long Gilt First Used in South Sea Bubble
Robert Hutton and Keith Jenkins – Bloomberg
Britain is proposing to revive “perpetual gilts,” first used in the wake of the 1720 South Sea Bubble crisis, to allow the government to borrow for as long as possible at record-low rates, according to two people familiar with budget discussions.
http://jlne.ws/z4kO3d

Environmental Trading News

Nobel economists urge Obama: back EU carbon limits
Reuters
Top U.S. economists, including five Nobel Prize winners, have urged U.S. President Barack Obama to drop his opposition to charging airlines for carbon emissions under a European Union scheme that has drawn fierce opposition from airlines and governments around the world.
http://jlne.ws/xLYLO1

Whisper it, but the EU’s climate strategy is working
Business Green blog
The contradiction is striking. Just as the European Union faces arguably the greatest crisis since its inception, leaving it visibly diminished on the world stage, the bloc’s ambitious and influential climate change strategy has never looked more powerful.
http://jlne.ws/y934TI

EU targets farm, forest land in extending CO2 curbs
Reuters
EU governments will have to record changes to forestry and farmland that alter the carbon balance under draft law published on Monday, as the European Commission presses ahead with new rules against greenhouse emissions.
http://jlne.ws/y5Pxpx

For more environmental trading news, subscribe to the Environmental Markets version of the John Lothian Newsletter edited by Jim Kharouf.
Visit http://www.jlnenvironmental.comto subscribe.

Exchange & ECN News

CFE And CBOE To Launch Futures And Options On Crude Oil ETF Volatility Index
CBOE Holdings, Inc. (CBOE) announced today that Chicago Board Options Exchange (CBOE) and CBOE Futures Exchange (CFE) will each launch a new volatility index product based on the CBOE Crude Oil ETF Volatility Index (OVX) in coming weeks.
http://jlne.ws/zNRDS0

NYSE Euronext delays European clearing decision
By Philip Stafford – Financial Times
NYSE Euronext has not made a decision on future plans for clearing the cash equities traded on its market and was watching the effects of sweeping industry changes on European clearers very closely, a senior executive said on Tuesday.
http://jlne.ws/zo1OeZ

ISE to List Options on ISE Max SPY Index
Press Release
The International Securities Exchange announced today that it has filed for approval with the Securities and Exchange Commission to list options on the ISE Max SPY Index, a new proprietary index that represents ten times the value of the SPDR S&P500 ETF Trust (SPY). Currently, options on SPY are the most actively traded contract in the options industry, with average daily volume of 2 million contracts on a year-to-date basis.
http://jlne.ws/wLFF6o

ISE Announces Optimise Roundtrip Latency of 250 Microseconds
The International Securities Exchange (ISE) announced that current median latency for its Optimise trading system equals 250 microseconds. This represents a reduction of approximately 39% since the completion of the Optimise rollout in August 2011. Significantly, ISE has reduced the latency tail so that 90% of all quotes submitted to the system are acknowledged within 340 microseconds, representing a 45% reduction in the past six months.
http://jlne.ws/xTlwbL

LCH.Clearnet, NYPC, DTCC and NYSE Euronext COLLABORATE TO PROVIDE UNPRECEDENTED CLEARING AND MARGINING EFFICIENCIES FOR MARKET PARTICIPANTS
LCH.Clearnet Limited, New York Portfolio Clearing LLC, The Depository Trust & Clearing Corporation and NYSE Euronext today jointly announced that they have agreed to explore expanding the existing combined “one-pot” cross-margining arrangement to include interest rate swaps cleared by LCH.Clearnet.
http://jlne.ws/zSlmSP

CME says new service to cut traders’ margin costs
By Ann Saphir – Reuters
CME Group Inc said on Tuesday it will on May 7 give banks and other large interest-rate traders a new way to slash the margins they put up to back their trades, in a bid to boost the futures exchange operator’s rate swaps clearing business.
http://jlne.ws/wm55i1

CME’s incoming CEO Gill isn’t seen as a change agent
Crain’s Chicago Business
(Crain’s)-New CME Group Inc. CEO Phupinder Gill, or “Gill” as he’s known in the futures industry, will put a new face on the Chicago exchange at a time when some customers are smarting from the MF Global Inc. debacle.
http://jlne.ws/z4KJ85

LCH.Clearnet Wants NYSE to Remain a Client, Axe Says
By Nina Mehta and Nandini Sukumar – Bloomberg
LCH.Clearnet Group Ltd., the clearinghouse that is selling as much as 60 percent of itself to London Stock Exchange Group Plc (LSE), wants NYSE Euronext to remain an owner and client, Chief Executive Officer Ian Axe said.
http://jlne.ws/z6n2MA

Deutsche Boerse, NYSE To Decide Soon On Challenge To EU Merger Finding
Jacob Bunge – Dow Jones
Deutsche Boerse AG and NYSE Euronext are nearing a decision on whether to launch a legal challenge to the European Union’s prohibition of their merger deal, according to a senior Deutsche Boerse executive.
http://jlne.ws/zdEKHT

Lower bonus cuts 2011 compensation for CME’s Donohue
By Alejandra Cancino – Chicago Tribune
The annual compensation for CME Group Inc.’s Chief Executive Craig Donohue fell slightly in 2011 to $6 million due in part to a 46 percent decline in his bonus as the company battled lower trading volumes after the collapse of MF Global Holdings.
http://jlne.ws/yvoOid

BM&FBOVESPA Announces Its Market Performance For February
http://jlne.ws/wjcXDF

[SIX] Bergbahnen Engelberg-Trübsee-Titlis AG is fined
http://jlne.ws/ycDvor

New Zealand’s Financial Markets Authority To Issue Revised Draft Guidance Note On Effective Disclosure In Offer Documents
http://jlne.ws/wPuZWb

Warsaw Stock Exchange In 2011: Consistent Implementation Of WSE Strategy Backed Up By WSE’s Robust Financial Standing
http://jlne.ws/xqatrb

Banks, Brokers & Dark Pools

Greek Bank Merger Off
BY ALKMAN GRANITSAS AND NEKTARIA STAMOULI – WSJ
Alpha Bank AE, Greece’s third largest lender by assets, said Wednesday that it will call a meeting of shareholders to scrap merger plans with cross-town rival EFG Eurobank Ergasias SA. In a filing to the Athens stock exchange, Alpha said it had informed Eurobank’s management of its intentions.
http://jlne.ws/Ah1vVk

Goldman Sachs to Pay $7 Million Over CFTC Trading-Account Claims
By Jesse Hamilton – Bloomberg
Goldman Sachs Group Inc. (GS) agreed to pay $7 million to resolve regulatory claims it failed to properly supervise commodities trading accounts, the U.S. Commodity Futures Trading Commission said. […] The company resolved the claims without admitting or denying wrongdoing, the CFTC said.
http://jlne.ws/xY4cHV

Newedge To Expand its Offering of Clearing Services to Centrally Cleared Interest Rate Swaps
Newedge, a global leader in multi-asset brokerage and clearing, today announced plans to develop its clearing facilities for interest rate swaps (IRS), thus extending its leading position in central clearing. Newedge’s entrance into this space significantly expands its existing activities and complements its leadership in global exchange-traded and cleared derivatives (ETDs).
http://jlne.ws/wXc9ox

Federal Reserve’s nightmare stress test scenario
Associated Press via Yahoo! News
The Federal Reserve’s stress test was designed to make sure banks can withstand an economic collapse worse than what happened in 2008. It imagined a nightmarish economic scenario:
http://jlne.ws/A7U3QM

Citigroup, SunTrust Banks Capital Plans Fail Federal Reserve Stress Tests
Bloomberg
Citigroup Inc., the third-largest U.S. bank, failed to meet the Federal Reserve’s minimum requirements in a stress test when examiners considered the effects of the bank’s plan for managing capital.
http://jlne.ws/AnjxIi

Pandit Repeats Moynihan Misstep as Fed Rebuffs Citigroup
Bloomberg
Citigroup was the biggest U.S. lender yesterday to fail the regulator’s exam of capital levels in a hypothetical economic downturn because of the New York-based firm’s plan to boost dividends or stock repurchases.
http://jlne.ws/yL8QbS

JPMorgan Dividend Announcement Surprises Investors, Irks Fed
By Dawn Kopecki – Bloomberg
JPMorgan Chase & Co., the biggest U.S. bank, surprised investors and the Federal Reserve when the firm announced two days early that it had received regulatory approval for a 20 percent dividend increase.
http://jlne.ws/yQi0JM

Broker departures accelerate at Merrill Lynch
Reuters via Yahoo! News
At least 50 advisers who managed nearly $12 billion in client assets at Merrill Lynch have left the “thundering herd” since January 1, based on moves tracked by Reuters. Many were veteran brokers that are hard to replace and who managed large sums of client assets at the firm.
http://jlne.ws/z5b2WK

Nomura Said to Be Cutting 30 Managers From Fixed-Income Division
Liam Vaughan – Bloomberg
Nomura Holdings Inc., Japan’s biggest securities firm, will cut about 30 managers in its fixed income unit, three months after naming Steve Ashley global head of the division, a person briefed on the matter said.
http://jlne.ws/xImTNF

Credit Suisse trader fined after game of ‘charades’
By Brooke Masters – Financial Times
The head of credit trading at Credit Suisse has been fined £210,000 for disclosing confidential information about a forthcoming E2.5bn bond issue after inviting a UK fund manager to “play charades” and guess the identity of the issuer.
http://jlne.ws/xsBgEv

Penson Announces Preliminary Agreement to Reduce Corporate Debt
Business Wire via Yahoo! Finance
Penson Worldwide, Inc. today announced that it has continued to take major steps forward with its previously announced strategic initiatives to strengthen its balance sheet, increase liquidity and improve performance in the face of challenging industry conditions.
http://jlne.ws/AEBRpg

Goldman Sachs Names Paulo Leme As Chairman For Its Brazil Unit
Dow Jones
Goldman Sachs Group Inc. (GS) named economist Paulo Leme as chairman of its operations in Brazil, it said Wednesday.
http://jlne.ws/zy8eBa

Goldman Officially Names Head Of Corporate Communications
Wall Street Journal Blogs
Goldman Sachs said Tuesday that Jake Siewert has joined the firm as managing director and global head of corporate communications.
http://jlne.ws/AjD6ek

Please join us in welcoming Jake to Goldman Sachs…
Posted by Paul Murphy – Financial Times
Hail Mary pass, or what? It was never going to be easy, being the new Lucas. Dealbook has the memo welcoming Richard “Jake” Siewert Jr to Goldman, penned by his line boss, John Rogers:
http://jlne.ws/AhTKzy

Goldman director savages ‘toxic’ investment bank
ShareCast
Greg Smith, Goldman Sachs executive director and head of the firm’s United States equity derivatives business in Europe, the Middle East and Africa – has quit in a savage open letter to the New York Times.
http://jlne.ws/xao6TH

Merger to Create Biggest Greek Bank May Be Scrapped
CNBC
Greece’s Alpha Bank plans to convene a shareholders meeting to pull out of a planned merger with Eurobank because of the impact of Greece’s bond swap deal on the banks, the lender said in a bourse filing on Wednesday.
http://jlne.ws/w3C9Ks

UBS Wealth Management Americas launches the Wealth Management Research Advisory Board
Business Wire via Yahoo! Finance
UBS Wealth Management Americas and its dedicated research arm, Wealth Management Research , today announced the creation of the Research Advisory Board, a collection of outstanding thought leaders and financial experts from across the industry who will regularly contribute to and inform the intellectual capital UBS makes available to financial advisors and clients.
http://jlne.ws/z3JC6X

HSBC Has No Plans To Pull Out Of New Zealand – Spokeswoman
FOX Business
HSBC Holdings PLC’s (HBC) New Zealand unit has no plans to exit the country and the unit isn’t under review, it said Wednesday.
http://jlne.ws/xr3zdc

Regulatory News

The SEC News Digest
The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.
http://www.sec.gov/news/digest.shtml

Modernize Wall Street Regulation Instead of Occupying the Industry
Forbes
Securities and Exchange Commission Director Cross raises provocative questions about our outdated regulatory system and hints at the need to create more modern approaches to raising capital. National regulatory critic Bill Singer is stunned by this dramatic and positive development.
http://jlne.ws/zmN0tN

Securities fraud settlements plummet: study
Jonathan Stempel | Reuters
Angry investors are seeing far fewer financial benefits from lawsuits accusing corporate America of securities fraud, but may be on the cusp of a turnaround. The number and size of securities fraud settlements that won final U.S. court approval fell in 2011 to the lowest in a decade, amid a drop in cases linked to accounting problems and U.S. Securities & Exchange Commission enforcement activity.
http://jlne.ws/xR5qDR

Madoff, Stanford Frauds Force FINRA to Step Up Fines, Surveillance in 2011
Financial Planning.com
FINRA is still dealing with the repercussions of massive Ponzi schemes operated by Bernard Madoff and R. Allen Stanford, resulting in double-digit increases in fines and disciplinary actions in 2011, according to the annual FINRA Sanctions Survey released by a Washington, D.C. law firm.
http://jlne.ws/y69M16

Volume of Volcker Rule Comments Was No Surprise, Regulators Say
By Phil Mattingly – Bloomberg
U.S. regulators said they weren’t surprised by the volume of the critical comments filed by financial companies and foreign governments over the Volcker rule, which bars U.S. banks from trading for their own account.
http://jlne.ws/zAeo8F

SEC Charges Three Mortgage Executives With Fraudulent Accounting Maneuvers in Midst of Financial Crisis
The Securities and Exchange Commission today charged the senior-most executives at formerly one of the nation’s largest mortgage companies with hiding the company’s deteriorating financial condition at the onset of the financial crisis. The plan backfired and the company lost 90 percent of its value in two weeks.
http://jlne.ws/yOi37Y

SEC Charges Five With Insider Trading on Confidential Merger Negotiations Between Philadelphia Company and Japanese Firm
The Securities and Exchange Commission today charged two financial advisors and three others in their circle of family and friends with insider trading for more than $1.8 million in illicit profits based on confidential information about a Philadelphia-based insurance holding company’s merger negotiations with a Japanese firm.
http://jlne.ws/Alu2F0

FSA slams ‘aggressive’ selling of retail investments
By Brooke Masters – Financial Times
The UK financial services industry “destroys trust” by aggressively selling complex, expensive products to retail investors and must do a better job of putting customers interests first, the Financial Services Authority official in charge of investor protection has warned.
http://jlne.ws/vZTOM3

[FSA] Head of European Credit Sales at Credit Suisse fined £210,000 for improper market conduct, disclosing client confidential information and exhibiting a lack of skill, care and diligence
http://jlne.ws/wWsJZ7

FSA publishes an analysis of the main risks facing consumers
http://jlne.ws/wlxALT

CFTC to Hold Open Meeting to Consider One Final Rule
The Commodity Futures Trading Commission (CFTC) will hold a public meeting on Tuesday, March 20, 2012, at 9:30 a.m., to consider one Final Rule: Customer Clearing Documentation, Timing of Acceptance for Clearing, and Clearing Member Risk Management.
http://jlne.ws/y8I27u

CFTC Vacates CME Clearing Europe Limited Registration as a Derivatives Clearing Organization
http://jlne.ws/x1nb4d

CFTC Charges Arjent Capital Markets LLC, Chicago Trading Managers LLC, Spencer Montgomery, and Brian Reynolds with Commodity Pool Fraud
The U.S. Commodity Futures Trading Commission (CFTC) today filed an enforcement action charging Colorado-based defendants Arjent Capital Markets LLC (Arjent), Chicago Trading Managers LLC (CT Managers), Spencer Montgomery, and Brian Reynolds with defrauding commodity pool investors by knowingly or recklessly issuing false account statements for three separate commodity pools.
http://jlne.ws/weVog5

CFTC Orders Chicago Futures Commission Merchant Fcstone, LLC And New York Introducing Broker Commodity Operations Inc. To Pay $260,000 For Supervision Violations
http://jlne.ws/xTzOgP

ASIC brings criminal charges against banned financial adviser
http://jlne.ws/xUXOov

BCSC Executive Director’s Bulletin: Securities regulator issues notice of hearing against West Vancouver Man
http://jlne.ws/yKfDZq

Investments – Indexes – Managed Futures – Managed Funds

Hedge funds launches surged in 2011
Reuters via Yahoo! Finance
The number of new hedge funds surged last year to the highest level since 2007, despite one of the most miserable annual performances in the industry’s history, according to data released on Tuesday.
http://jlne.ws/wJVbZ5

Man launches innovative commodities fund
Man Group Plc. (‘Man’), the global alternative investment manager, has launched the Man Commodities Fund, an innovative fund which offers retail and institutional investors exposure to global commodities markets in a UCITS format.
http://jlne.ws/x5opUR

Paulson’s Lacoursiere Said to Leave to Start Own Hedge Fund
Bloomberg
Robert Lacoursiere, the Paulson & Co. partner who oversaw the $23 billion hedge fund’s team of banking analysts, quit last week after four years to start his own fund, according to a person with knowledge of the matter.
http://jlne.ws/wYo8kR

Top-Ranked Nuveen Manager Iben to Join Vinik’s Hedge Fund
Bloomberg
David Iben, the top-ranked portfolio manager who heads Nuveen Investment Inc.’s Tradewinds global stock-picking unit, plans to join Jeffrey Vinik’s hedge fund.
http://jlne.ws/xlfRNH

Capula Investment’s Systemic Trading Head Dai Is Said to Leave Hedge Fund
Bloomberg
Qiang Dai, who oversees systematic investing at London-based Capula Investment Management LLP, plans to leave the $13 billion hedge fund to pursue personal interests, according to a person brief on his decision.
http://jlne.ws/wFrgu3

Hedge funds to pay more for litigation insurance
By Kara Scannell in New York – Financial Times
Hedge funds are being asked to pay an average 5 per cent to 10 per cent more to buy officers’ and directors’ insurance in response to an expected increase in litigation from insider trading and regulatory investigations, a survey has found.
http://jlne.ws/wZwd09

Pimco Deploys Derivatives in Race for Target-Date Fund Investors
Bloomberg
Invesco Ltd. (IVZ) and Pacific Investment Management Co. are adding riskier assets and complicated strategies in target-date funds as they seek to gain ground on Fidelity Investments and Vanguard Group Inc. in this fast- growing segment of the U.S. retirement market.
http://jlne.ws/xidEV9

Equinox Expands Product Range with Launch of Single CTA Program Mutual Funds
Business Wire via Yahoo! Finance
Equinox Fund Management, LLC , an innovator in alternative investment funds with almost $1.5 billion under management, announced today the launch of the Equinox Alternative Strategy Platform .
http://jlne.ws/zhLjTv

Schroder International Multi-Cap Value Fund Wins Lipper Award for Best Five-Year Performance in Category
PR Newswire
Schroder Investment Management North America Inc. (SIMNA) is pleased to announce that the Schroder International Multi-Cap Value Fund (IMCV) is the winner of the 2012 Lipper Award for Best Fund in its category over a five-year period.
http://jlne.ws/y7mot9

Horizon Cash Management sees improved environment for Managed Futures and CTAs
Two prominent CTA indices have published positive year-to-date returns for managed futures funds, highlighting a promising start to the year for this sector. The BarclayHedge CTA Index, a leading industry benchmark of representative performance of commodity trading advisors is up 0.85% for 2012 and the Newedge CTA index, designed to track the largest CTAs and be representative of the managed futures space is up 0.93% for the same period.

Hedge Fund Billionaire Dan Och Sued By One Of His Former Traders For $150 Million
Forbes
Arnaud Achache made a lot of money working for Dan Och, but Achache wants more.
http://jlne.ws/yg81Z8

Technology News

Saxo Bank Adopts SunGard’s Ambit Private Banking Solution on an ASP-Basis
Saxo Bank (Schweiz) AG has become the first bank in Switzerland to adopt SunGard’s Ambit Private Banking solution on an application service provider (ASP) basis.
http://jlne.ws/xhFQQ4

R.J. O’Brien & Associates Signs Deal for FFastFill’s Global Trading SaaS Execution
FFastFill plc, the leading provider of Software as a Service (“SaaS”) to the global derivatives community, is pleased to announce that its front office trade execution and management suite, Trading Pro, is to be deployed within R.J. O’Brien & Associates (“RJO”) operations in Europe and the US.
http://jlne.ws/xu44RE

Deltix and CitiFX Launch Automated FX Trading Solution at Equinix with Alacrity FX as first client
Deltix, Inc., a leading provider of software for the development and deployment of advanced alpha generation and execution strategies, and CitiFX Pro, the margin FX trading division of Citi, today announced an agreement to offer the Deltix Product Suite via CitiFX Pro.
http://jlne.ws/zFkluy

RTS Realtime Systems Launches DMA to BM&FBovespa
RTS today announced that it now offers DMA (Direct Market Access) connectivity for low-latency, high frequency traders to BM&FBovespa, Brazil’s securities, commodities and futures exchange. The new native connectivity comes with comprehensive pre-trade risk functionality that was audited and approved by the exchange and now can be used via DMA 1 and DMA 2 connectivity.
http://jlne.ws/AlpdVm

Media News

Encyclopaedia Britannica to end print edition after 244 years
By Robert Channick, Chicago Tribune reporter
There have been more than 7 million sets of Encyclopaedia Britannica printed and sold over the years, an indispensable home reference library lining bookshelves, fueling dreams and salvaging homework assignments everywhere. You can look it up. Online.
http://jlne.ws/AAj1x8

Reports

Briefing.com Economic Calendar
http://www.briefing.com/Investor/Public/MarketAnalysis/Calendars/EconomicCalendar.htm

USDA Today
http://www.nass.usda.gov/Publications/index.asp

CBOE Events Calendar
http://www.cboe.com/AboutCBOE/EventCalendar.aspx

Economic Release Calendar
The Economic Release Calendar (PDF) is a schedule of government, academic and industry economic releases, provided as a service to CME customers.
http://www.cmegroup.com/tools-information/calendars/

Asia-Pacific News

Eurex and Singapore Exchange to link centres
By Jeremy Grant in Boca Raton – Financial Times
Eurex, the futures exchange run by Deutsche Börse, and Singapore Exchange have said they will link their data centres to allow traders of each other’s derivatives products easier and cheaper access.
http://jlne.ws/yh5Tr6

SGX welcomes NYSE Technologies network to SGX data centre
Singapore Exchange (SGX) today announced NYSE Technologies, the commercial technology division of NYSE Euronext, is extending its Secure Financial Transaction Infrastructure (SFTI) network to the SGX data centre in Singapore.
http://jlne.ws/zPXlJf

S&P Indices taps SGX futures prices for new S&P CNX Nifty Futures Real-time Index
S&P Indices today launched the S&P CNX Nifty Futures Real-time Index, a measure of the returns on offshore exposure to the Indian equity market based on Singapore Exchange (SGX)-listed S&P CNX Nifty Index futures prices.
http://jlne.ws/xnTXAs

SGX links global liquidity pools to Asian economies, enables access to international markets
Singapore Exchange (SGX) today brings Asian markets closer to global investors with the launch of hubs in Chicago and London. The hubs are the first by an Asian exchange and will provide customers with convenient and cost-effective local connections to SGX markets.
http://jlne.ws/ApTeCD

SGX offers access to biggest ASEAN economy via MSCI Indonesia Futures
Singapore Exchange (SGX) is adding the MSCI Indonesia Index Futures to its suite of Asian equity index derivatives in the second quarter of this year. The new contract is based on the MSCI Indonesia Index, which measures the performance of the largest and most tradable stocks listed on the Indonesian equity market. It is a widely followed Indonesian benchmark for institutional investors.
http://jlne.ws/wBQik6

Thai Bourse Market Report For February
Daily Average Trading Volume Up 39.81 Pct Month-On-Month To USD 1.12 Bln – Market Cap At THB 9.52 Trillion, Up 13.27 Pct From End-2011 – Derivatives Trading Up 21.80 Pct Month-On-Month At 34,230 Contracts Per Day
http://jlne.ws/wSsbFw

Shanghai Stock Exchange Urges Securities Companies To Strengthen Investor Education In Rational Investment
Press Release
http://jlne.ws/AbHuuz

Frontier Markets

India bourses launch SME platforms
By James Crabtree in Mumbai – Financial Times
India’s two main stock markets on Tuesday launched the nation’s first investment platforms for small and medium-sized enterprises, aiming to replicate the success of London’s Alternative Investment Market and New York’s Nasdaq in raising capital for smaller, fast-growing businesses.
http://jlne.ws/wE3s2t

Tehran Stock Exchange Lists Iran Kish Credit Card Co.
http://jlne.ws/yOxfGi

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