Top Headlines

How Brexit Will Redraw Europe’s Financial Infrastructure – Financial Times (subscription)

London will continue to have a crucial role, thanks to the happy accident of geography, which places it at the centre of the global trading day. Being an island off the western continental shelf puts it in a prime position to accept transatlantic cables carrying trillions of dollars of trades from North America to London. Those cable connections have boosted London’s share of foreign exchange global turnover by as much as a third.

European Firms Oppose FX Swaps Reporting Reforms – Global Investor (subscription)

Most firms were reporting two legs so it is “ironic” Europe has requested only one, an expert has said.

Refinitiv CEO Readies for Data Tussle with Bloomberg – Financial News (subscription)

David Craig sees the firm created in a $17bn leveraged buyout as an established company with a start-up feel.

‘Cover 2’ Reserves Inadequate for Many CCPs: Study – (subscription)

Large clearing houses are supposed to hold resources capable of absorbing the simultaneous default of their two largest members. But this standard, known as “Cover 2”, fails to account forthe likely impact of a twin default on the network of interbank exposures, weakening other clearing members and increasing the strain on the centralcounterparty.

London Gold Market Comes Clean: It’s Not as Big as Thought – Bloomberg

London’s gold market owned up to the biggest secret inbullion: it’s not as big as some thought and, for last week at least, smaller than New York’s.

Investment Banks are Waging a War for Star Talent in 2018. Here are the Banks that Won – and the Banks that Lost – Business Insider

It’s been one of the most active years in senior investment banking hires and exits since the financial crisis, according to top Wall Street headhunters.

Sweeter Bonuses for Women This Year as Wall Street Confronts Gap – Bloomberg

Trading desks, renowned bastions of gender inequality, will sweeten compensation for women this year to narrow the gap with men.

Regulatory News

Fed’s Banking Watchdog Is Poised to Lead Global Regulator – Bloomberg

US Federal Reserve Vice Chairman Randal Quarles is expected to succeed Bank of England Governor Mark Carney as chairman of theFinancial Stability Board, a key global financial regulator.

CFTC Amends Margin Requirements, Confirms Hires – Global Investor (subscription)

CFTC approved rule to amend uncleared swap margin rules to better align with other US regulators.

Q&A: CFTC’s Quintenz Talks Bitcoin, Nasdaq Breach, Algo Trading – (subscription)

The young but savage spot market for cryptocurrencies has “significant” problems, says Commodity Futures Trading Commission commissionerBrian Quintenz. But he expresses confidence in the futures trade at establishedexchanges that price their crypto wares off those same spot arenas.

Banks Are Closing in on European Licenses for Life After Brexit – Bloomberg

Twenty-five banks have concluded, or are close to finishing, applications for EU subsidiaries, said Daniele Nouy, the industry’s chief supervisor at the European CentralBank.

MAS, Central Banks Explore Alternative Models for Cross-Border Payments – Regulation Asia (subscription)

The central banks of Singapore, Canada and England have jointly released a report discussing emerging opportunities for digital transformation in cross-border payments.

Crypto News

Bitcoin Drops Towards $4,000 Level in Broad Crypto Sell-Off – Financial Times (subscription)

Bitcoin dropped again on Tuesday, extending its recent falls and pushing towards the $4,000 level amid a broad cryptocurrency sell-off sparked by disagreements within the coin developer community and persistentconcerns about regulatory scrutiny.

Crypto Exchange Irregularities Prompt Regulation Concerns – Financial Times (subscription)

Pressure is building on regulators to increase oversight of cryptocurrency trading following a $15bn crash in bitcoin and irregularitiesat one of the world’s largest virtual trading platforms.

KPMG Report: ‘Cryptoassets are Now Impossible to Ignore’ But There are Still Challenges Facing Institutionalization – The Block

KPMG notes that “crypto assets are now impossible to ignore.” The firm believes that in 2017, crypto started competing against the traditional asset classes from an investment perspective. 

Hong Kong Regs Signal New Crypto Battle with Singapore – FinanceAsia

New cryptocurrency regulations couldlose Hong Kong business in the short-term but by instilling greater confidencein the market they could help further ahead.

Crypto Currencies Could Allow Central Banks to Stay in Money Game – Bloomberg

Issuing digital currencies would allow central banks to stay relevant in a time of disappearing cash, according to Cornell University professor Eswar Prasad.

Company News

Societe Generale to Pay $1.4 Billion to Settle Cases in the US – Reuters

The bank agreed to pay $1.34 billion to settle investigations into its handling of dollar transactions in violation of US sanctions against Cuba and other countries.

Deutsche Bank Has Got Some Interesting New Technology Teams. And They’re Hiring – eFinancialCareers

Housed within the global transaction bank, one isdescribed as an ‘early product software team’. Deutsche is also trying to jointhe data party. The bank has engendered something called the Alpha-Data Innovation Group, which wants to use machine and deep learning to deriveinsights from both financial and non-financial data.

The Power of Swaps Data Analytics: Q&A with JP Morgan’s Warren Rabin and Scott Hamilton – Tabb Forum

JP Morgan’s Warren Rabin and Scott Hamilton examine the benefits of data analytics technology for a bank’s swaps business, including improving risk management and client trading strategies.

BNP Paribas Selects Itarle Group for Independent Buy-Side TCA – The Trade

BNP Paribas has announced a new partnership with best execution order analytics firm Itarle Group to provide its buy-side clients with independent transaction-cost analysis.

Market Savvy

Sterling Slips on Market Selloff and Brexit Nerves – Reuters

Sterling slipped on Tuesday, dragged down by declines among risky assets and concerns about Brexit negotiations.

Euro Weakens as Equity-Market Selloff Supports Safe Havens – Reuters

The euro fell from a two-week high on Tuesday as a selloff in European stock markets and nervousness about Italian banks fed through to the currency.

Yuan Exposed to Vanishing US-China Yield Gap as Much as Trade – Bloomberg

The yuan could face more weakness and not only because of rising trade tensions between China and the US, or currency manipulation. For the first time in at least a decade, one-year Treasuries yield more than short-term Chinese debt, and BMO Capital Markets says that spells trouble forChina’s currency.