Securities firms have long made it a priority to adopt and implement robust compliance programs as part of their self-regulatory efforts and good business practices. The Compliance Department plays an important role in securities firms? Compliance programs. The purpose of this paper is to discuss the scope, limits of responsibilities...
In recent years, discussions of financial innovation and risk management invariably turn to credit derivatives. Although these instruments are drawing increasing attention and growing in importance, credit derivatives remain an obscure subject for many participants in financial markets. This introduction, which is drawn in large measure from recent presentations, is...
The combined total showed that, for all broker-dealers doing a public business in the United States, profits (pre-tax net income) reached $2.98 billion, 61.2% below results obtained in the same year-earlier period and 60.7% below profits recorded in 1Q'04. Gross revenues in 2Q'04 declined to $53.93 billion, down 8.1% from...
This paper discusses the security related issues used in Transaction Processing; the new Global Treasury Management committee will work on STP payments processing issues along with other treasury related issues within the broker/dealer community. The group will continue to review the new Check 21 legislation and its impact on broker/dealer.
The Securities and Exchange Commission has proposed a new rule governing the National Market System NMS dubbed NMS that touches on many aspects of the U.S. market structure and raises a variety of issues for all market participants. This piece will review the main components of proposed NMS and reactions...
After a three-year downturn, industry revenue growth resumed in 2003 and by year-end had become more robust and broad-based, spreading to virtually every product and service line. The improved results eased the pressure on securities firms to cut costs further after trimming non interest expense 15.6% over the past three...
The apparent market failure is primarily the result of two factors: the reinsurance industry not fully recapitalizing after losses stemming from a series of extraordinary, catastrophic events and the difficulties inherent in evaluating or "pricing" terrorist risk. Whether the temporary Terrorism Risk Insurance Act of 2002 needs to be supplemented,...
New equity research business models are rapidly emerging. The new business models are the product of structural changes, induced largely by dramatic alteration of the regulatory landscape. This in turn is transforming virtually every aspect of how research is produced, distributed and funded. The practical issues of managing the provision...
The private financial community continues to participate in efforts to strengthen crisis prevention, promote early crisis containment and hence mitigate the cost associated with financial crises in emerging markets and to provide a flexible, market-based approach to sovereign debt restructuring operations when a payments interruption becomes unavoidable. These efforts have...
The U.S. securities industry is on track to earn record profits in 2003. After a strong first half, improvement continued in 3Q 2003, as revenue growth became more broad based and profits jumped. The report expect 2003 profits for NYSE-reporting firms to reach $22.45 billion, more than triple last year's...
According to the report IIF also points to major unresolved issues in Basel II, as well as to regulations in the Accord that need streamlining, despite the Basel Committee's wish to come to a final agreement on the Accord by the end of the year. For example, the IIF points...
Market structure questions have been climbing steadily toward the top of the SEC priority action list for a variety of reasons, including Congressional pressure, causing everyone involved to revisit those issues that have arisen again and again since the National Market System was created in the mid-1970's. This article, reviews...
The threat of deflation is real and, should it arrive, could prove dangerous, harming both investors and consumers alike. While we are currently not yet experiencing deflation, it may not be far off. The time to deal with deflation is before it arrives, since it has a momentum of its...
Recent revelations of serious misconduct by certain high profile research analysts during the boom years of the 1990s has forced securities market regulators and market participants alike to examine how conflicts of interest, particularly those arising from the production and dissemination of research, can be better managed in today's integrated...
This report provides an update of recent performance and an outlook for the U.S. securities industry, along with alternative forecasts for U.S. financial markets and the U.S. economy, which drive prospects for the securities industry. Not surprisingly, near term forecasts are proving especially difficult, reflecting a long litany of uncertainties,...
Hedge funds as they exist today perform a very specific and very necessary role in the global financial marketplace: their managers utilize trading techniques often not available to managers of different investment vehicles that target temporary inefficiencies and dislocations in the market, effectively helping to minimize or eliminate those dislocations....
President Bush has proposed ending the double taxation of corporate earnings by eliminating the personal income tax on dividends. To support that worthy goal, an assessment of the absolute and relative costs and benefits of this significant change in our tax structure is presented below. We consider how the specific...
In the white paper, the Securities & Exchange Commission and other agencies distinguish between "core" industry participants and "significant" industry participants. They estimate that "core" firms should be able to resume operations after a major disruption in two hours, and that "significant" firm should be able to resume operations in...
This report expresses the view that "two and one half years into a severe cyclical downturn, clear evidence of a turnaround in the U.S. securities industry is still largely absent, although some hopeful signs have appeared." The report further, suggests that industry performance was "finding a bottom," and forecast a...
Two and one-half years into a severe cyclical downturn, clear evidence of a turnaround in the U.S. securities industry is still largely absent, although some hopeful signs have appeared. Wall Street's recovery will depend on a rebound in both business investment spending and a restoration in investor confidence, both of...
