Top Headlines

Banks’ Civil Forex Settlements Near $2 Billion – Wall Street Journal(subscription)
The total amount paid by banks to settle a civil lawsuit tied to allegations traders manipulated the currency market has now reached almost $2 billion following a recent round of settlement agreements.

Accountability for Conduct Dominant Theme at Iosco – Profit & Loss (free story)
Making management more accountable for conduct and culture was a prevalent theme in private member meetings this week, according to the chairman of the International Organisation of Securities Commissions (Iosco), the global umbrella body for securities regulators.

UK Watchdog Defends Hefty Fines for Banks Who Break Rules – Reuters
Stiffer fines for banks caught trying to rig markets have not undermined financial stability or the ability of lenders to stay solvent, a senior British regulator said on Wednesday.

China Banks Turning Net Foreign Exchange Buyers Stabilise Flows –Bloomberg
China’s banks turned net buyers of foreign exchange on behalf of their clients in May for the first time in nine months, signalling capital flows are stabilising. Lenders purchased CNY 24.5 billion yuan ($3.95 billion) more overseas currencies than they sold last month, the State Administration of Foreign Exchange said in a statement on Thursday.

FX: The Great Internalisation Debate – Euromoney 
The widespread practice of internalisation in foreign exchange has officially come under fire from regulators for a lack of transparency and is fast losing its shine, but it remains crucial to the smooth running of the world’s largest market.

Derivative Exchanges Eye Asia for Growth and Liquidity – Profit & Loss (free story)
Major derivative exchanges are keeping a close watch on developments in Asia, particularly China, as higher margin requirements in Europe and the US encourage institutional investors to move clearing to other jurisdictions.

HFT Nightmare Gets Some Validation, But Only if You’re a Whale – Bloomberg
To critics, high frequency traders harm other investors by sniffing out their strategies and completing the juiciest trades first. New academic research from the Netherlands suggests naysayers have it at least partly right.

Regulatory News

Iosco to Establish Global Conduct Task Force – Financial News
An international body of securities regulators is set to launch a global task force to examine conduct in financial markets and the responsibilities of senior managers, hot on the heels of a major conduct review published by the Bank of England last week.

Global Regulators Throw Spanner into Planned Asset Manager Rules –Reuters
The world’s umbrella body for market regulators will launch an immediate full review of potential risks from asset management activities and products, throwing into doubt planned new global rules for top funds.

EU Seeks Transaction Tax as 11 States Meet in Bid to Choose Path –Bloomberg
The 11 European nations seeking a financial-transactions tax will meet Thursday in Luxembourg in a bid to decide how to design the measure, according to European Union officials.

FCA’s Wheatley Speech: Confidence to Crisis and Back
Commenting on positive conduct and its impact on trust and growth at the Iosco conference in London, Martin Wheatley, CEO of the Financial Conduct Authority, says that the core challenge today is effectively completing that post-Libor post-FX remediation phase.

Company News

Bullion Capital Adds VitalMarkets – Profit & Loss (free story)
Online precious metals exchange Bullion Capital, has announced the signing of prime broker boutique VitalMarkets to join its membership base, which now counts almost 70 brokers.

DTCC Calls for Standard Approach to Trade Reporting – FOW (subscription)
The Depository Trust & Clearing Corporation (DTCC), operator of the world’s largest global trade repository, has called on international regulators to harmonise trade-reporting standards and has issued a number of recommendations, including standardised data fields.

Market Savvy  

Your Starter for 10: Why isn’t the Euro Falling?
Financial Times
It’s a puzzle, what with the whole Greece-possibly-about-to-default-and-maybe-drop-out-of-the-euro thing. We asked some analysts and investors why they think the euro’s exchange rate against the dollar is so steady.

Dollar Droops as Fed Refrains from Clearer Rate Lift-Off
The dollar index shed 0.6% to hit a one-month low on Thursday after the Federal Reserve disappointed investors who had hoped for a clearer signal on when the US central bank will lift interest rates.

Financial Market Perspectives
Most major asset classes reversed early losses to finish mixed to modestly higher Wednesday after the FOMC presented a more dovish policy outlook than had been expected. Ahead of the Fed news Treasuries were down fairly sharply and US equities were moderately lower in anticipation of somewhat hawkish guidance from the FOMC.

Press Releases

Iosco: Meeting the Challenges of a New Financial World
The International Organization of Securities Commissions (Iosco) met this week at its Annual Conference in London to progress its work across its policy, research, capacity building and co- operation agenda.

SIFMA Statement on Iosco Strategic Direction Announcement
SIFMA issued a statement from Tim Cameron, managing director and head of SIFMA’s Asset Management Group, on the communiqué released today by the Board of the International Organization of Securities Commissions (Iosco).

Industry Events