
Firms Tackle MiFID II Challenges at Bloomberg Event in London
This feature is upgradeable
For End Users
You can activate this feature and other links for ALL VENDORS with a VendorMatch Premium subscription. Additionally you can gain access to an increased depth of data, summary reports, RFX reports (detailed completed RFIs - available to financial institutions only) and comparison grids. Please click here for more information.
For Vendors
Vendors can activate their links and gain access to analytics by upgrading to VendorMatch PRO. Please click here for more information.
Speak with an analyst
Financial institutions and their advisors can subscribe to our Analyst Access* service. Effectively phone or (email) a friend you can have on tap advice and support provided by our analysts on this vendor, solution or solution category.
HOW TO SUBSCRIBE
To protect vendor data only financial institutions and recognized advisors can subscribe to VendorMatch Premium. Please click here for more information.
or contact us to discuss a subscription.
Subject to reasonable use.
Survey Summary
The Survey Summary provides a download of the vendor profile, solution profile and the VendorMatch Discovery survey vendor responses used to power the directory. All responses are provided by the vendor online.
Note that this report is a high level summary of the vendor's credentials and a solution's capabilities designed to assist with solution short-listing. The RFX report is the more comprehensive Request For Information report designed to support evaluation and selection, this will only show where the vendor has completed the "RFX" RFI.
HOW TO SUBSCRIBE
To protect vendor data only financial institutions and recognized advisors can subscribe to VendorMatch Premium. Please click here for more information on Premium features or contact us.
RFX Report
The RFX report is an XLS download of the Vendors response to the “RFX” Request for Information for this solution.
The RFX is a centralized golden copy of a RFI authored by our analysts based on their expertise in running real-life system evaluation and selection projects and completed by the vendor online.
Note to protect vendor that only Financial Institutions and recognized Advisor can subscribe to this feature.
In each instance the first time the link is used the user requests permission to access the RFX report and it is the vendor who is required to authorizes access. You will be alerted when the vendor has reviewed your request and granted permission.
HOW TO SUBSCRIBE
Please click here for more information on Premium features or contact us.
To learn more about subscribing to our service options, please contact us here
With less than 15 months remaining to implement MiFID II—the European Union’s all-encompassing set of regulations—financial services firms are under the gun to formulate a plan to meet the guidelines, particularly those related to record-keeping of communications, voice recording, and trade reconstruction.
Bloomberg recently hosted an event in London attended by more than 230 financial services professionals. The agenda focused on key challenges presented by the regulations, including record-keeping, next-generation surveillance, best execution, liquidity analysis, research and regulatory reporting—areas that are proving to be a test of firms’ current capabilities.
In an event survey, only 7% of attendees said their firm was ready to meet the requirements, while nearly 50% of respondents said that their firms are only now in the process of formulating a plan and willnot be prepared to implement by the January 2017 deadline.
According to Harald Collet, Global Head of Bloomberg Vault, “Due to the immense scope of MiFID II, and the fact that not all rules have been finalized, meeting the January 2017 implementation deadline will be a challenge for many firms. But, despite uncertainty, firms can still begin tackling the rules that are relatively straightforward and unlikely to change such as record-keeping and market abuse prevention mandates.”
The record-keeping requirements of MiFID II present a significant undertaking for many firms, but MiFID II is very clear on what needs to be done. Firms are required to adhere to:
- Record-keeping: comprehensive and accurate records must be captured, including all voice recordings of telephone conversations, minutes from in-person meetings, e-communications (such as email, instant messaging and fax) related to the reception, transmission or execution of any trade.
- “Readily available”: MiFID II mandates that records be readily available for search, analysis and retrieval upon request from the local regulator (NCA).
- Reconstructing records by events: records must also be categorized by transaction and by counterparty. This requirement introduces additional complexity into how each record is captured and tagged. For example, regulators can request all the communications for a trade or a counterparty.
- Retention: records kept in accordance with Article 16(7) must be available to clients for a minimum of five years; for regulators, up to seven years.
- Storage: records must be maintained in a durable medium, such as Write-Once-Read Many (WORM), that cannot be altered or deleted but must be searchable and readily available upon request.
Photographer: Akos Stiller/Bloomberg
Many firms are looking for a silver lining when investing in compliance solutions—MiFID II record-keeping requirements represent an opportunity. Indeed, 67% of those surveyed at the event in London noted that their compliance managers must currently rely on manual, labor-intensive procedures to fulfill supervisory tasks and perform enforcement actions, while 20% said their companies had no standard procedures at all. This mandate provides an opportunity to automate labor-intensive manual processes.
On another positive note, 82% of those surveyed said earlier investments to comply with other regulatory directives such as Volcker, Dodd-Frank Act and EMIR have accelerated their abilities to respond to MiFID II.
Other key challenges cited by those participating in the survey included:
- Talent shortage: high demand and tighter supply of legal/compliance and tech talent are slowing the efforts of many firms.
- Technology rollout and adoption: many are working to find the right solutions, in particular with regard to the changes in pre-trade transparency requirements.
- Understanding the details: finding a way to understand the nuances of these requirements and implementing effective procedures to disaggregate the data will be a high priority.
- Time-clock synchronization: firms with global operations may have difficulty with the requirement for clock synchronization in the markets.
- Data volume: the massive amount of records generated is resulting in many firms struggling to process and retain records.
- Engagement with regulators: most firms had encountered pushback from officials when they asked for greater clarity.
- Resolving conflict laws: global firms will have to reconcile differences between financial regulation and local laws in Europe, e.g., privacy laws.
As the implementation deadline comes ever-closer, firms must proactively assess how new technology can help them support a regulation-ready data-governance strategy.
The most proactive firms will use MiFID II to compete more effectively in a transformed industry.