Week InReview:  October 10, 2014

IN THE INDUSTRY 

Nasdaq Service Battle: (Oct. 10) No decision yet on who will control a critical data service responsible for distributing stock prices for U.S. companies like Apple Inc.. The importance of the securities information processor, or SIP, was highlighted in August 2013 when a malfunction at Nasdaq halted trading in Apple, Google Inc. and thousands of other stocks for three hours. Read more.

ABS Incentives: (Oct. 10) EU financial-services chief Michel Barnier proposed banks should have the right to use a wider range of asset-backed securities to meet a planned liquidity rule. He also presented a definition of high-quality securitizations that would get preferential capital treatment in a bid to encourage insurers to enter the market. Read more.

ON THE HILL 

CFTC Turf War? (Oct. 8) Three U.S. senators say the CFTC undermined a government probe into a trader's alleged rigging of an energy market and that their $750,000 fine to settle the case is "an embarrassment." Read more. 

Delaying Extenders Could Delay Tax Refunds: (Oct. 7) The longer Congress delays action on tax extenders, the greater the risk that the tax filing season and millions of taxpayer refunds will be delayed, among other serious disruption, an IRS Commissioner said in a letter to the Senate Finance Committee Chairman. Read more.

AT THE AGENCIES 

EU Delaying Rule Would Discourage Clearing in U.S. (Oct. 9) CFTC Chairman Timothy Massad said that European regulators have decided to postpone implementing a rule that would impose greater capital requirements on European banks accessing U.S. clearinghouses. The rule currently is scheduled to take effect Dec. 15. Read more. 

Currency Wars: (Oct. 7) G-7 finance ministers and central bank governors pledged in February 2013 to use domestic policies to boost growth and "not target exchange rates," which the group said should be set by markets. Treasury Secretary Jack Lew agrees. "The language that was agreed to in the G-7 meetings at the beginning of 2013, I think was the right formula, and it's one that we should all stick with," he said. Read more. 

Trading Safeguards: (Oct. 6) Regulators have delayed action on a proposal to require trading firms to put in place new testing and maintenance checks aimed at preventing market mishaps. SEC Commissioners Luis A. Aguilar and Kara M. Stein have called on the SEC chair to apply the new requirements to wholesalers such as Citadel Securities and KCG Holdings, which collectively execute as much as 19% of shares traded. Read more.

This is not an all-inclusive list of congressional, agency and market participant actions related to these issues. It is a snap-shot of what we believe is of most interest to institutional investors. Some links are to subscriber-only sites. 

Be sure to check our website for this InReview, upcoming events, and all our INVESTORS updates.  www.association.institutionalINVESTORS.org