Top Headlines

European Banks Face $52 Billion in Litigation Costs: Morgan Stanley – Reuters
Royal Bank of Scotland and Barclays may have to pay some of the biggest bills from an estimated $52 billion in fines and other litigation costs facing Europe’s banks in the next two years, Morgan Stanley analysts said. European banks have paid out about $104 billion so far and the $52 billion they still have to pay, much of it related to foreign exchange trading, could restrain how much they pay in dividends.

BAML Picks FX Specialist to Lead Equities Trading in EMEA – Financial News (subscription)
One of Bank of America Merrill Lynch’s top foreign exchange traders in Asia is moving to Europe to lead equities trading in the region.

Senate Approves Margin Carve-Out for Non-Financials – Risk.Net (subscription)
Non-financial derivatives users in the US are a step closer to being shielded from margin requirements for non-cleared swaps after the Senate overwhelmingly passed a bill confirming their exempt status.

Collapsing Oil Price Rattles Markets – The Wall Street Journal (subscription)
The fallout from collapsing oil prices continued to shake up markets, dragging down oil-related stocks, boosting government bonds and piling further pressure on the beleaguered Russian ruble.

Yen Near One-Month High vs Dollar as Oil Rout Sours Risk Sentiment – Reuters
The yen hit a one-month high against the dollar on Tuesday, buoyed by steady demand for safe-haven assets against a backdrop of plunging oil prices that has triggered worries about global growth.

UBS Global Chair Predicts Volatile Year – Australian Financial Review
Falling oil prices, a rising US dollar and competing agendas of central banks should make for an unpredictable ride in financial markets this year, according to UBS global chairman and former central banker Axel Weber.

Deutsche Bank E-Commerce Sales Chief Exits – Financial News (subscription)
Neehal Shah, the global head of e-commerce sales at Deutsche Bank who held a variety of senior foreign exchange roles, has left. His move comes after a year of change at the top of the German bank’s fixed income unit.

Greenwich Flags Top Market Structure Themes for 2015 – FX Week (subscription)
A fight for continuous FX benchmarks, increased competition among instant messaging providers, advances in clearing non-deliverable forwards and unbundling research costs are likely to be a few of the main market structure themes this year, according to financial consultancy Greenwich Associates.

Euro Approaches Nine-Year Low on Stimulus Outlook; Pound Drops – Bloomberg
The euro fell toward a nine-year low versus the dollar as officials fuelled speculation that the European Central Bank will begin buying government bonds as early as next week to stave off deflation.

Ericsson Report Reveals Early Warning Signs of Dramatic Disruption in Financial Services Industry – CryptoCoinsNews
Ericsson has released a new report that reveals the financial services industry is already “exhibiting some early indicators of potentially dramatic industrial disruption” due to cryptocurrencies.



Regulatory News

ESMA Announces Open Hearing on MiFID II/MiFIR
The European Securities and Markets Authority (ESMA) will hold an open hearing on 19 February on the issues set out in its Consultation Paper on MiFID II/MiFIR published in December 2014.

ESMA Plans Open Meeting on CSDR Implementation – Profit & Loss (subscription)
The European Securities and Markets Authority (ESMA) has organised an open hearing meeting today (13 January) at its offices in Paris to discuss proposed technical standards, technical advice and guidelines for implementing the Central Securities Depositories Regulation.

Opinion: On Retail Forex, Regulators Have Failed To Reach Far Enough – Forbes
The central problems in retail forex stem from conflicts of interest between FX dealers and customers under the traditional “dealing desk” trade execution model.



Company News

Standard Chartered Cuts Equities Unit, FX ‘Unaffected’ – Profit & Loss (subscription)
Standard Chartered has become one of the first global banks to exit the equity markets business resulting in 200 job losses, mostly from Asia. The move is not currently expected to have any impact on the FX business.

Gain Capital Appoints Head of Global Sales for GTX – Reuters
Online trading services provider Gain Capital Holdings said it appointed John Miesner managing director, head of global sales for GTX, the company’s institutional foreign exchange trading platform.

RBC Appoints Head North American Fixed Income and Currencies Sales – Bloomberg
Royal Bank of Canada has appointed Jeff Fields to head its North American fixed income and currencies sales team as it seeks to expand its presence in the US debt market.

HSBC’s Fung Departs: Wong Takes Newly Created Greater China Role – Profit & Loss (subscription)
Anita Fung Yuen-mei, chief executive of HSBC Hong Kong, is leaving after 19 years with the bank.



Market Savvy  

BoE to Look Though UK Inflation Surprise
BNP Paribas
This morning’s downside surprise to UK CPI does not alter our outlook for GBP to outperform over the months ahead. In the near term inflation is likely to push down to zero, but we continue to have a positive outlook for the GBP for several key reasons. First, our economists expect strong wage growth going forward given the diminishing labour market slack; second, our August BoE hike call is considerably more aggressive than what is priced into the UK rate curve; third, positioning in GBP is at its largest short since July 2013. The interest rate market pricing and FX positioning provide substantial scope for GBP to strengthen.



Press Releases

LMAX Exchange Launches in Hong Kong
LMAX Exchange, a UK FCA regulated MTF for global foreign exchange trading has launched LMAX Hong Kong Limited, an SFC licensed broker for leveraged FX trading.

Tullett Prebon Expands US Business After Agreeing Broker Acquisition From Murphy & Durieu
Forty new fixed income brokers will provide additional liquidity and expertise in a broad range of fixed income products.

Coinsetter Adds Post-Trade Settlement and Margin for Business Customers
Post-trade settlement will allow customers to place trades on Coinsetter’s order book before making a deposit, allowing them to trade without holding large balances on an exchange and limiting their exposure to third-party risks.

Fluent Trade Technologies Launches Low Latency Data Analytics with Big Data Release
Fluent Trade Technologies has released its real-time financial big data product providing foreign exchange market participants with faster, more intelligent analytical tools.

Derivatives and FX Most Active Markets on Moscow Exchange in December
The derivatives and FX markets were Moscow Exchange’s most active in December, with volumes up a respective 137% and 52% YoY.



Industry Events