Hayes Handed 14 Year Prison Sentence for Libor Rigging

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Hayes Handed 14 Year Prison Sentence for Libor Rigging – Profit & Loss (free story)

Tom Hayes, the first individual to be charged and stand trial in the UK for manipulating the Libor benchmark, has been sentenced to 14 years in prison.

HSBC Sets Aside $1.3 Billion for Ongoing FX Investigations Profit & Loss (free story)

HSBC has put aside $1.3 billion in legal provisions to resolve the ongoing investigations into FX market manipulation according to its interim half-year report

‘Jury Still Out’ on Local Currency Clearing: CIMB  – Risk.net (subscription)

ASEAN OTC derivatives market is not big enough to warrant clearing.

Algorithmic Trading May Elevate Risks of Flash Events: Treasury, Fed  – The American Banker (subscription)

Federal Reserve Board Gov. Jerome Powell and the top adviser to Treasury Secretary Jack Lew said that, based on the recent autopsy of the October 15, 2014 spike in Treasury yields, there is reason to believe that high-frequency or algorithmic trading may elevate the risk of similar events in the future.

Trading the 4pm FX Fix: A Window into Market Impact – Tabb Group

More and more transparency is coming to the foreign exchange market. In the wake of the recent Fix manipulation scandals, the methodology for calculating the 4pm WM/R Fix was changed, and banks have shifted how they handle client orders around the Fix in order to show they are meeting execution standards, relates David Mechner, CEO, Pragma.

Regulatory News

New York Financial Regulator Opens New Deutsche Bank Libor Probe  – Global Investigations Review (subscription)

Deutsche Bank has admitted that it failed to disclose chat records to enforcers investigating Libor rigging – the latest in a string of errors by the bank, which was criticised in April by the FCA for mistakenly destroying hundreds of tapes of phone conversations.

Regulation: Too Early to Tell on Too-Big-to-Fail – Euromoney

With much fanfare, the US Dodd-Frank Act celebrated its fifth birthday last month. Hailed as a landmark piece of legislation to ensure the orderly liquidation of financial firms, the act mitigates systemic risks associated with banks’ size, interconnectedness, complexity, cross-border activities and funding, among other things.

Citi study raises questions about CCP default waterfalls – Risk.net (subscription required)

 The amount of “skin in the game” a central counterparty holds results in a level of risk sharing too low and gives “rise to a fundamental misalignment of interests,” according to clearing specialists at Citi.

Company News

LCH considering FX products for 2016 – FOW (subscription required)

Following LCH.Clearnet’s settlement services tool launch next year, the London-based clearinghouse is considering what foreign exchange options products to add.

Trading on SGX Derivatives Market Suspended Due to Technical Fault – Channel News Asia

Trading was suspended at 7.56pm the SGX says. “We are investigating and will update the market as soon as possible,” the bourse says.

Multi-legged order entry facility in currency futures soon: BSE – The Economic Times

Leading stock exchange BSE today said it will soon introduce multi-legged order entry facility on its currency derivative platform.

Market Savvy  

Australia’s Central Bank Holds Rates, Tempers Call for A$ Fall – Reuters

Australia’s central bank held interest rates at record lows on Tuesday in a widely expected decision, but surprised markets by toning down calls for a further fall in the local dollar.

Brazil Real Leads Losses as BNP Paribas Says Pain Not Over Yet – Bloomberg

Brazil’s real led declines among major currencies and fell to a 12-year low as BNP Paribas SA and London Capital Group said it was poised for another 10 percent decline.

Press Releases

Hotspot to Offer Free Trade On New London-Based Matching Engine

Hotspot, a leading institutional foreign exchange (FX) market owned and operated by BATS Global Markets (BATS), today announced plans to incentivise customers by offering free trading for all transactions on its planned London-based matching engine to the end of 2015.

Industry Events