Tarbert Begins Term as 14th CFTC Chairman

Jul 16, 2019

First Read

Hits & Takes
JLN Staff

Thank you to all the firms and schools that are sending interns and college students to our MarketsWiki Education World of Opportunity series starting today at Trading Technologies.~JJL

Thank you to all our sponsors of the event, including Trading Technologies, the Stuart School of Business at Illinois Tech, Barchart, OCC, FTSE Russell, The IFM and the sponsor of the backpacks, CME Group. We could not make this happen without you.~JJL

We are sold out for today, but we still have some seating for Wednesday’s session at Illinois Tech. Their auditorium on West Adams takes about 225 people. Sign up at www.marketswikieducation.com.~JJL

The Financial Times tweeted a feisty op-ed on corporate jargon called “Why companies like Ocado produce gobbledegook.” I had never heard of Ocado, but they are far from the only offender.~SR

According to BarclayHedge, the hedge fund industry posted a 1.94% return in June.~SD

Clearpool Execution Services was censured and fined $473,000 by FINRA and an array of stock exchanges for failing to adequately supervise “a foreign, unregistered proprietary trading fund (‘Fund X’) that was an affiliate and customer of Clearpool… Fund X traded through more than 1,000 foreign, unregistered individual traders, and triggered thousands of surveillance alerts at FINRA and multiple exchanges for potential manipulative trading known as ‘layering’ and ‘spoofing.'” When Clearpool was formed in 2013, two business partners who owned 76 percent of Clearpool were the same individuals who had “previously formed Fund X, provided Fund X’s investment, and owned 100 percent of Fund X’s investment manager.” Clearpool was on regulators’ radar from day one as the two partners behind Fund X (one of Clearpool’s earliest customers, by the way) had a prior prop firm that was also under suspicion for manipulative trading.~SD

The FIA released exchange-traded derivatives (ETD) volume and open interest report for June. The overall volume was 2.86 billion contracts, down 7.2% from May, but up 12.6% YoY. Sign up for FIA volume notifications here.~SD

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Where Satellite Imagery for Agriculture is Headed

JohnLothianNews.com

In this video, UrtheCast’s SVP of Data Analytics David Gebhardt talks about the applications of high quality satellite imagery for farmers and what is holding back full-scale adoption of the technology.

Watch the video »

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CME Group Congratulates CFTC Chairman Heath Tarbert
CME Group
CME Group today released the following statement on the swearing in of Commodity Futures Trading Commission (CFTC) Chairman Heath Tarbert: “CME Group congratulates Dr. Tarbert as he is sworn in today as CFTC Chairman, following his strong bipartisan confirmation last month. His experience and accomplishments in the international arena in his role as Acting Under Secretary for International Affairs at the U.S. Department of the Treasury position him extraordinarily well to lead the agency. We look forward to working with the new Chairman and Commissioners Behnam, Berkovitz, Quintenz and Stump to address cross-border regulatory challenges and ensure the continued growth and integrity of U.S. derivatives markets.
bit.ly/2jKMFQa

****** New chairman, full slate of commissioners, when was this last the case?~JJL

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Wall Street Gets Horsey in Water Mill to Fight Children’s Cancer
By Amanda L Gordon – Bloomberg
Son of Morgan Stanley banker received treatment at St. Jude; John Paulson, Goldman’s Carr, Citi’s MacDonald seen at Parrish
Danny and Shawna Birdsall met at a club in Amagansett on Fourth of July weekend in 2004, when they were in their 20s — a classic Hamptons love story.
/bloom.bg/2jFKpJX

***** This is good work.~JJL

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Trading Technologies Launches Colocated Access to the TT® Platform Through ICE Data Services’ European Liquidity Center in Basildon
Trading Technologies International, Inc.
Trading Technologies International, Inc. (TT), a global provider of high-performance professional trading software, infrastructure and data solutions, today announced the launch of colocated execution and client connectivity services through the ICE Data Services European Liquidity Center (EULC) in Basildon, UK. This expansion to Basildon provides TT’s global user base with the lowest-latency direct market access to ICE’s European derivatives markets through the TT platform, while also offering European customers an additional point of connection to TT’s global execution network. This colocated infrastructure allows users to access and trade 55 markets with speed and precision through the TT platform.
bit.ly/2jK1Wke

*****They had me at “Basildon.”~JJL

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Through My Eyes: The Floor of the New York Stock Exchange
Stacey Cunningham via LinkedIn
Not long ago, I gave a lecture at my alma mater and received a question about the relevance and future of a floor-based trading model in this day and age. At a time when discussions about innovation tend to focus on increased automation, it is not an uncommon question, especially given the limited viewpoint many have when they visit or see the New York Stock Exchange on TV.
bit.ly/2jJdEeU

****The floor versus the screen does not have to be a mutually exclusive issue.

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Monday’s Top Three
Floor traders like a good battle. Readers like a good story about floor traders. And so The Wall Street Journal took the top read story of the day with Floor Traders Clash With NYSE. Second was a job posting for a solutions engineer position at Char IQ via Indeed.com. Third was John Lothian‘s JLN piece, Letter to Heath Tarbert, Chairman of the Commodity Futures Trading Commission, about the need for more diversity at the agency.

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Lead Stories

Tarbert Begins Term as 14th CFTC Chairman; Chairman Tarbert: “Now Is the Time to Act.”
CFTC
Dr. Heath P. Tarbert officially began his term today as the 14th Chairman of the U.S. Commodity Futures Trading Commission (CFTC), succeeding J. Christopher Giancarlo.
bit.ly/2jJ8Ypp

Corzine Accepts Prop Trading Ban in His Wall Street Resurrection
By Miles Weiss and Hema Parmar – Bloomberg
SEC restrictions stem from collapse of Corzine’s MF Global; Limits come as part of his firm’s bid for SEC registration
Jon Corzine’s commodities firm blew up the last time he was trading on Wall Street. Now regulators want to make sure his new hedge fund doesn’t suffer the same fate.
/bloom.bg/2jJuf2f

FCA head warns Libor may fail regulatory test after 2021
Philip Stafford – FT
The head of the UK markets regulator has warned that it may be forced into a sudden discontinuation of Libor for new business if the banks that make daily submissions to the lending rate begin leaving rapidly after 2021.
/on.ft.com/2jFyJqB

Central Bankers Are Sick of Rescuing the World Economy Alone
By William Horobin and Simon Kennedy – Bloomberg
Monetary policy around the world near the limits of its power; Group of Seven meetings take place in France this week
Global central bankers are again in the driving seat when it comes to propping up the world economy, but many are demanding governments join them in the rescue effort.
/bloom.bg/2jIG5cX

Banks ‘must not wait’ to transition from using Libor – Fed’s Williams
Reuters
Federal Reserve Bank of New York President John Williams on Monday said the finance industry “must not wait” to stop using the Libor lending benchmark.
/reut.rs/2jKZPN6

CME Group Achieves Record Quarterly International Average Daily Volume of 5.3 Million Contracts in Q2 2019
CME Group
CME Group, the world’s leading and most diverse derivatives marketplace, today announced that it achieved its highest quarterly international ADV on record, with 5.3 million contracts traded during the second quarter of 2019, up 25% year over year and surpassing the previous quarterly record of 4.9 million contracts traded in Q1 2018. This record, reflecting all trading done outside North America, was driven mainly by growth of Interest Rate, Equity Index and Agricultural products.
bit.ly/2XPMscn

Why (Almost) Everybody Hates Facebook’s Cryptocurrency Libra
By Olga Kharif – Bloomberg
Facebook Inc. says its mission is to “bring the world closer together.” Its plans to launch a digital currency called Libra have succeeded in uniting central bankers and financial regulators from around the globe, along with U.S. President Donald Trump and his Democratic opponents in Congress. They’re dubious about the idea, at best. But Facebook isn’t alone in pursuing what is known as a “stable coin,” a form of cryptocurrency that so far has proved far more boring than, say Bitcoin. While some regulators are reacting to the idea that Facebook could leverage its 2 billion users to create a de facto global currency, other industry analysts wonder whether stable coins like Libra will find any widespread use at all.
/bloom.bg/2jKlxRk

Deutsche Bank hires AQR Capital technology chief; Neal Pawar will take on the role of chief information officer at Deutsche Bank in early September.
By Hayley McDowell – The Trade
The chief technology officer at AQR Capital is set to leave the investment management firm to join Deutsche Bank as its group chief information officer.
bit.ly/2jKHTlI

Charles Schwab in Talks to Buy USAA Wealth-Management, Brokerage Units; Discount-brokerage pioneer would pay roughly $2 billion to move further into financial advice
By Dana Cimilluca, Telis Demos and Justin Baer – WSJ
Charles Schwab Corp. SCHW 0.42% is in talks to buy brokerage and wealth-management operations from USAA for roughly $2 billion, a move that would push the discount-trading pioneer further into the coveted business of financial advice.
/on.wsj.com/2jFWBud

Cannabis CEOs Are White Men, Just Like in the Rest of Corporate America; As VCs and corporate money move in, women say they’re being pushed aside.
By Ellen MIllgian, Kristine Owram, Jordyn Holman – Bloomberg
When Nancy Whiteman, 61, founded her marijuana edibles company, Wana Brands, almost a decade ago in Boulder, Colo., the legal industry was relatively diverse and dominated by local startups. It helped that Wall Street banks and institutional investors took a hands-off approach to cannabis, leery of getting involved with a drug that’s still banned by the federal government. “It was a pretty even playing field for everybody—men, women, anybody who was interested,” Whiteman says.
/bloom.bg/2jIMjtl

Japan’s online brokerages target Nomura’s retail business; Rakuten and kabu.com among those planning a customer push linked to country’s pension crisis
Leo Lewis – FT
Nomura faces an aggressive challenge to its core retail business, as Japan’s five biggest online brokerages plan to put the country’s deepening pension crisis at the heart of a new push for customers.
/on.ft.com/2jKb5cy

Institutional Crypto Exchange Seed CX
Nikhilesh De – Coindesk
The New York Department of Financial Services (NYDFS) has granted virtual currency licenses to two subsidiaries of aspiring crypto derivatives provider Seed CX.
bit.ly/2jLbMlU

Exchanges, OTC and Clearing

CME Group sees quarterly trading records in Europe and Asia; Average daily volumes in Europe, Asia and Latin America reached record highs at CME Group in the second quarter this year.
By Hayley McDowell – The Trade
US derivatives exchange and clearinghouse CME Group has set a new international quarterly trading record during the second quarter of this year, driven by high volumes across Europe, Asia and Latin America.
bit.ly/2jIZKJN

Morgan Stanley offers client clearing through LCH CDSClear; Morgan Stanley is that latest investment bank to offer client clearing of credit derivatives through LCH CDSClear.
By Hayley McDowell – The Trade
Morgan Stanley has gone live with LCH as the latest investment bank to launch client clearing of credit default swaps via CDSClear.
bit.ly/2jKxI0w

Fintech

Bloomberg supports Itiviti with SSEOMS client transition; Itiviti is looking to transition clients from SSEOMS to its own multi-asset OMS after Bloomberg said it will exit the market.
By Hayley McDowell – The Trade
Bloomberg is working alongside Itiviti to transition clients from its sell-side execution and order management solutions (SSEOMS) platform, after announcing plans to withdraw the system from the market.
bit.ly/2jIZkTJ

Facebook launches tool to shutdown online scams; Martin Lewis lawsuit prompts new reporting procedure for fraudulent ads
Madison Darbyshire – FT
Facebook has launched a new tool aimed at shutting down online scams following a lawsuit filed by Martin Lewis, founder of MoneySavingExpert.com.
/on.ft.com/2jKxQgu

Cambridge VC firm IQ Capital raises $300m ‘deep tech’ fund; Investments focus on technologies developed based on significant advances, such as AI
Martin Coulter – FT
IQ Capital, a venture capital firm based in Cambridge, has raised more than $300m to invest in long-term “deep tech” projects.
/on.ft.com/2jKnBc4

Redline Trading Solutions’s RedlineFeed Reaches the Clouds
Redline Trading Solutions
Redline Trading Solutions, the premier provider of high-performance market data and order execution systems for automated trading, today announced the availability of RedlineFeed for access to real-time and delayed exchange market data to customer solutions deployed in the cloud.
bit.ly/2jLf8W4

Factbox – Blockchain projects: A status update
Anna Irrera, John McCrank – Reuters
Banks, exchange operators and other companies are investing billions of dollars to find uses for blockchain, a digital ledger used by cryptocurrencies like bitcoin.
/reut.rs/2jL3AlE

Bloomberg Terminals to Get Broad Access to Dow Jones News; Content now available alongside Bloomberg stories, articles from other news sources
By Kimberly Chin and Michael Dabaie – WSJ
Bloomberg terminal subscribers gained broad access to Dow Jones & Co. news content on Monday, according to the companies.
/on.wsj.com/2jJreir

Cryptocurrencies

Steven Mnuchin joins Facebook critics on Libra cryptocurrency; US Treasury secretary says social network has ‘a lot of work to do’ to win approval
Kiran Stacey and Hannah Murphy – FT
Facebook has “a lot of work to do” before the Trump administration will let it proceed with its planned cryptocurrency, the US Treasury secretary warned on Monday, a day before the company is due to testify before Congress about the project.
/on.ft.com/2jK2CpO

Ripple adoption gets another boost after Santander bank launches new payment corridor; Customers in the UK and Poland can now transfer up to 10,000 euros via the One Pay FX iOS app instantly.
By Rebecca Campbell – Decrypt
Spanish banking giant Banco Santander has announced its One Pay FX, a digital banking app powered by Ripple for cross-border payments, has added a new corridor to its blockchain powered service.
bit.ly/2jJfDQr

Polkadot Tokens Valued at $75 Pre-Launch in Crypto ‘Futures’ Offering
Leigh Cuen – Coindesk
The cryptocurrency futures exchange CoinFLEX, backed by Polychain Capital and investor Roger Ver, will launch its first initial futures offering (IFO) this week.
bit.ly/2jKMg08

Video and Transcript of U.S. Treasury Secretary’s Press Briefing on Cryptocurrencies
by Aislinn Keely – The Block Crypto
The U.S. Department of the Treasury Secretary Steven Mnuchin called concerns surrounding crypto a “national security issue” in a news briefing on cryptocurrencies today, stressing that the administration’s “number one issue” is keeping bad actors from utilizing crypto for nefarious activity. The Block has edited this transcript for clarity and length.
bit.ly/2jJgUab

CFTC’s New Chairman: Who Is Heath Tarbert, What He Thinks of Crypto?
By Kirill Bryanov – Cointelegraph
July 15 will mark the first day in the office for the United States Commodity Futures Trading Commission’s (CFTC) new chairman, Heath Tarbert. As the crypto community is bidding farewell to the regulator’s outgoing head, J. Christopher Giancarlo, his successor’s stance on digital assets remains unknown. Turning to Tarbert’s record as a civil servant and attorney in the financial markets field could shed some light on the direction that the agency might take under his leadership.
bit.ly/2jL9za6

New York Department of Financial Services grants virtual currency licenses to Seed CX subsidiaries
The Block Crypto
The New York Department of Financial Services (DFS) has awarded licenses to two subsidiaries of the Chicago-based cryptocurrency exchange Seed CX, Financial Services Superintendent Linda A. Lacewell announced.
bit.ly/2jGvkI5

Seed CX Receives Two BitLicenses for Crypto Trading and Settlement
By Tanaya Macheel – Cheddar
Cryptocurrency exchange Seed CX has received two virtual currency licenses, better known as a BitLicenses, from the New York State Department of Financial Services.
bit.ly/2jJzZJl

Politics

Treasury’s Mnuchin says deal to raise U.S. debt ceiling getting closer
Reuters
U.S. Secretary Steven Mnuchin said on Monday the administration and Congress are getting close to a deal on raising the U.S. debt ceiling and he has urged lawmakers to take action on the issue before their August recess.
/reut.rs/2LqmnPk

US lawmakers set to grill Facebook executive in charge of Libra
By Clare Duffy, CNN Business
The first of two Congressional hearings this week on Libra will kick off Tuesday. Facebook executive David Marcus will testify before the Senate banking committee at 10 am ET.
/cnn.it/2jGjM7H

Facebook Confronts Bipartisan Resistance to Cryptocurrency Plans; Treasury Secretary Mnuchin, other U.S. officials raise concerns about Libra project ahead of executive’s congressional testimony
By Dave Michaels, Kate Davidson and Sam Schechner – WSJ
The Trump administration raised national security concerns about Facebook Inc. FB -0.47% ‘s plans to launch a cryptocurrency as a growing chorus of U.S. and international officials voiced resistance to the tech giant operating its own digital money.
/on.wsj.com/2jFUZAF

What the U.S.-China Trade War Is Really About; The tariffs get all the attention, but the dispute is mainly over national security and geopolitical power.
By Tyler Cowen – Bloomberg
During my recent travels in Taiwan and China, I was asked repeatedly: What does America really want out of the trade war with China? In the interests of mutual understanding, here is my brief guide to America’s conflicting and complicated motives. Spoiler alert: The tariffs may get more attention, but the critical issues are Huawei and Taiwan.
/bloom.bg/2jKSDk4

Peter Thiel Says Elizabeth Warren Is Most ‘Dangerous’ Candidate
By Lizette Chapman – Bloomberg
Peter Thiel, the technology industry’s most prominent supporter of President Donald Trump, called Elizabeth Warren the most “dangerous” Democratic presidential candidate.
/bloom.bg/2jJpSUT

Regulation

Fed’s Williams Calls for More Urgency in Replacing Libor
New York Fed president tells financial firms to pick up pace on adopting new SOFR benchmark
Michael S. Derby – The Wall Street Journal
Federal Reserve Bank of New York President John Williams said Monday financial firms need to stop dragging their collective feet and transition to a new reference interest-rate system to replace the scandal-plagued London interbank offered rate regime.
“I don’t always sense urgency among market participants on this issue” of replacing what’s called Libor, Mr. Williams said a speech delivered at a conference held by the Securities Industry and Financial Markets Association.
/on.wsj.com/2LtOPQz

New platform to replace Gabriel and improve the way we collect data from firms
UK FCA
We have started work to improve the way we collect data from firms and plan to move to a new platform for our data collection systems, which will include replacing Gabriel. We want your views to help with this.
bit.ly/2jKShKe

The future of regulation: AI for consumer good
UK FCA
Speech by Christopher Woolard, Executive Director of Strategy and Competition at the FCA, delivered at The Alan Turing Institute’s AI ethics in the financial sector conference (link is external).
bit.ly/2jJa0BN

Nomura to Pay Misled Bond Customers $25 Million to Settle SEC Charges
SEC
The Securities and Exchange Commission today instituted two related enforcement actions against Nomura Securities International Inc., which has agreed to repay approximately $25 million to customers for its failure to adequately supervise traders in mortgage-backed securities.
bit.ly/2jKER0Q

SEC and NASAA Explain Application of Securities Laws to Opportunity Zone Investments
SEC
The Securities and Exchange Commission and the North American Securities Administrators Association (NASAA) have issued a summary that explains the application of the federal and state securities laws to opportunity zone investments. The “opportunity zone” program was established by the Tax Cuts and Jobs Act in December 2017 to provide tax incentives for long-term investing in designated economically distressed communities.
bit.ly/2jKRdpI

ESMA publishes the 23rd extract from the EECS database
ESMA
The European Securities and Markets Authority (ESMA), the EU’s securities markets’ regulator, has published an extract from its confidential database of enforcement decisions on financial statements.
bit.ly/2jKBG9q

ESMA consults on performance fee guidelines for retail funds, seeking greater harmonisation
ESMA
The European Securities and Markets Authority (ESMA) launched today a public consultation on draft guidelines on performance fees under the Undertakings for Collective Investments in Transferable Securities (UCITS) Directive.
bit.ly/2jG554x

July 2019 Disciplinary Actions
FINRA
FINRA has taken disciplinary actions against the following firms and individuals for violations of FINRA rules; federal securities laws, rules and regulations; and the rules of the Municipal Securities Rulemaking Board (MSRB).
bit.ly/2jKCsmQ

Accounting watchdog moves to beef up audit independence rules; FRC seeks changes to rules on conflicts of interest and limits on other services offered clients
Kate Beioley – FT
The UK’s audit watchdog has proposed more stringent ethical rules requiring firms to be independent from their clients following a series of high-profile accounting controversies at UK companies, including retail chain BHS and outsourcer Carillion.
/on.ft.com/2jKzcrA

How Fiduciary Regulation Is Failing Investors
Robert Schmansky – Forbes
I have a client who is determined to find the worst investment opportunities. The absolute bottom of the barrel, far “too good to be true” investments he finds I have found immense joy in analyzing and deconstructing over the years, though lately have become far more concerned about their ability to market confusing information and products directly to consumers.
bit.ly/2jLcGii

Nomura to Pay $25 Million Over Mortgage Bond Traders’ Lies
By Matt Robinson – Bloomberg
Firm failed to supervise CMBS and RMBS traders, SEC Says; SEC has focused on opaque mortgage bond market since crisis
A Nomura Holdings Inc. unit will repay customers about $25 million to settle U.S. regulators’ allegations that it failed to supervise traders who made false statements in negotiating sales of mortgage securities.
/bloom.bg/2jL1HW8

Investing and Trading

In a World of Negative Yields, India Bonds Rally to 2016 Highs
By Kartik Goyal – Bloomberg
Benchmark 10-year yield falls to 6.31%, lowest since Dec. 2016; Hopes of deeper RBI rate cuts fueling bond rally: DCB Bank
Sovereign Indian debt streaked ahead, sending benchmark yields to 2 1/2-year lows, amid growing expectations of deeper rate cuts by the central bank and increased foreign demand.
/bloom.bg/2jIGV9B

Sudden Jump in Hedge-Fund Exposure Flashes Warning for Equities
By Joanna Ossinger – Bloomberg
Sundial says S&P 500 tends to drop in setups like current one; Goepfert says issue is ‘primarily a shorter-term’ concern
Trend-following hedge funds have boosted exposure to U.S. stocks to a point that may signal declines ahead.
/bloom.bg/2jKSlcY

Electric Power Trader Gets Zapped; Also the European Investment Bank, stock ledgers and Bitcoin prices.
By Matt Levine – Bloomberg
Man, electric power markets are nuts. Here’s a story about a guy named Federico Corteggiano:
/bloom.bg/2jGuPhb

This Shale Fracker’s Decision to Sell Says It All; Carrizo bailing out at the bottom shows just how desperately the E&P sector needs to consolidate.
By Liam Denning – Bloomberg
A big deal in the Permian basin should be cause for fanfare in oil and gas circles. And yet, a distinct sad-trombone note sounds as Carrizo Oil & Gas Inc. falls into the arms of Callon Petroleum Co.
/bloom.bg/2jJiZTu

Institutions

JPMorgan Chase Posts Higher Second-Quarter Profit; Nation’s largest bank is the first of three major lenders to report results Tuesday
By David Benoit – WSJ
JPMorgan Chase JPM -1.21% & Co. said Tuesday that second-quarter profit rose. The nation’s largest bank reported a profit of $9.65 billion, or $2.82 a share. Analysts polled by FactSet had expected earnings of $2.50 a share. A year earlier, the bank reported a profit of $8.32 billion, or $2.29 per share.
/on.wsj.com/2jKupq8

KeyCorp Finds Fraudulent Activity Estimated at Up to $90 Million
By Chris Wack – WSJ
KeyCorp KEY -1.57% said it discovered fraudulent activity around July 9 associated with transactions conducted in the third quarter by a business customer of KeyBank National Association.
/on.wsj.com/2jIKZqk

Goldman Sachs Reports Lower Profit; Wall Street firm run by David Solomon dealt with uncertain markets in the second quarter
By Liz Hoffman – WSJ
Goldman Sachs Group Inc. GS -1.10% ‘s quarterly profit fell 6% as trading clients, spooked by trade tensions and interest-rate whiplash, kept their money on the sidelines.
/on.wsj.com/2jFUd6J

StanChart chief blasts investors as ‘immature’ for pay revolt; Winters’ criticism comes after 40% of shareholders failed to back remuneration policy
David Crow and Attracta Mooney – FT
The chief executive of Standard Chartered has launched a blistering attack on “immature” investors who recently staged a protest against his pay.
/on.ft.com/2jKmfhu

JPMorgan Bond Trading, Revenue Outlook Suffer From Fed Reversal
By Michelle Davis – Bloomberg
Bank lowers net interest income forecast by $500 million; Shares fall as fixed-income desks post fourth straight drop
JPMorgan Chase & Co. was hit by the Federal Reserve’s about-face on interest rates in the second quarter, posting its fourth-straight decline in fixed-income trading revenue and warning that lending income will fall in the second half.
/bloom.bg/2jFLn93

Schwab in Talks to Buy USAA Units to Diversify, WSJ Reports
By John Gittelsohn and Devon Pendleton – Bloomberg
Deal would be a further move into advice business for Schwab; Schwab shares are down this year as asset managers gained
Charles Schwab Corp. appears to be making a play to grab more advisory clients as fees fall for asset management and trading.
/bloom.bg/2jIIIeP

Irish Banks Pay Out Close to $770 Million in Mortgage Scandal
By Peter Flanagan – Bloomberg
Central bank publishes final report on overcharged borrowers; Regulator has fined one bank, investigating other main lenders
Irish banks paid out more than three quarters of a billion dollars to customers who were overcharged on their mortgages, a scandal that has tarnished the industry for a decade since the financial crisis.
/bloom.bg/2jKdvYG

Citigroup cuts costs as lending margins squeezed; US bank kicks off quarterly earnings season with revenues under pressure
Robert Armstrong – FT
Citigroup’s lending margins came under pressure in the second quarter of the year, suggesting pain ahead for other large US banks.
/on.ft.com/2jK1qmk

Banks lure customers with air miles and perks; With interest rates low, lenders look to attract depositors with different rewards
David Crow and Robert Armstrong – FT
In ancient Babylon, banks began paying interest on deposits. Two thousand years later, Standard Chartered has come up with an alternative.
/on.ft.com/2jFsZNz

Citigroup Shows That Banks Can’t Depend on Traders; Wall Street continues to see few market opportunities as stocks grind to record highs.
By Brian Chappatta – Bloomberg
12.49USD-0.19-1.50%
It’s a tough time to be a trader on Wall Street. (Cue playing of the world’s smallest violin.)
/bloom.bg/2YcXcpD

Regions

French central bank chief says ECB should not be driven by markets; François Villeroy de Galhau’s comments come as some forecasters expect ECB rate cut
David Keohane and Hannah Copeland – FT
France’s top central banker has said that monetary policy must remain independent of market inflation expectations as well as political pressure, pushing back at suggestions the ECB needs to act at its July meeting.
/on.ft.com/2jKpiGs

Poland Charges Ex-Deputy Finance Minister With Neglect of Duty
By Marek Strzelecki – Bloomberg
Polish prosecutors charged against a former deputy finance minister with neglect of duty in a tax-fraud case that resulted in 3 billion zloty ($792 million) losses for the state treasury.
/bloom.bg/2jIwBOQ

Why Is India Trying to Kill Off Hedge Funds?; The Indian taxman is strangling a nascent industry that the country should be nurturing instead.
By Andy Mukherjee – Bloomberg
India is killing off the one industry that can bring badly behaving tycoons into line while nudging savers away from an unproductive lust for gold.
/bloom.bg/2jKTvFm

Brexit

Why Brexiters do not fully trust Boris Johnson; History of wavering creates doubts about how ex-foreign secretary will respond as PM
George Parker – FT
Boris Johnson has been propelled towards Downing Street with the backing of Tory Eurosceptic MPs, who believe they have a blood oath from the prospective prime minister that he will take Britain out of the EU on October 31, with or without a deal.
/on.ft.com/2jFxh7D

Brexit Talks Get More Hostile as EU Considers Sweeteners to Deal
By Ian Wishart – Bloomberg
Meeting between negotiators was one of worst since 2016; Bloc may work on package from next month to avert ‘no deal’
A meeting of chief Brexit negotiators last week was one of the most difficult encounters of the last three years, according to European officials, who are bracing for talks to become more hostile under the next British government.
/bloom.bg/2jIprtZ

How Britain’s Savviest Investors Are Beating Brexit; They steer clear of U.K. companies or pick the ones that can flourish amid chaos.
By Matthew A. Winkler – Bloomberg
Since the U.K. decided more than three years ago to leave the European Union, the nation’s savviest investors have succeeded by putting their money where Brexit matters least.
/bloom.bg/2jL6RRY

Miscellaneous

Pearson Signals Demise of the College Textbook in Digital Drive
By Greg Ritchie – Bloomberg
Company will focus on regular digital updates of U.S. titles; Digital business now accounts for almost two-thirds of sales
The world’s biggest educational publisher will release all future editions of its U.S. titles digitally first, as students dump their traditional textbooks and switch to online learning.
/bloom.bg/2jKocKO

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