ICMA - International Capital Market Association’s Post

Municipal Securities Rulemaking Board (MSRB) Welcome to the Municipal Securities Rulemaking Board (MSRB), the self-regulatory organization dedicated to protecting investors and promoting a fair and efficient municipal securities market. Established under the Securities Acts Amendments of 1975, the MSRB plays a crucial role in regulating the municipal securities industry, which includes municipal bonds, notes, and other related securities. Our Mission The MSRB's mission is to enhance the integrity of the municipal securities market by establishing rules and policies that govern the activities of brokers, dealers, and municipal advisors. We aim to ensure transparency, fairness, and investor protection in the issuance and trading of municipal securities, thereby fostering public confidence in the market. Key Functions Rulemaking: The MSRB develops and enforces rules that govern the conduct of municipal securities firms and advisors. These rules are designed to protect investors and ensure fair practices in the market. Market Transparency: Through our Electronic Municipal Market Access (EMMA) system, we provide free access to municipal securities data, including official statements, continuing disclosures, and trade data. This transparency helps investors make informed decisions. Education and Resources: We offer a wealth of educational materials and resources for both industry professionals and the public. Our goal is to promote understanding of municipal securities and the regulatory framework that governs them. Research and Analysis: The MSRB conducts research on market trends and trading patterns, providing valuable insights that help stakeholders navigate the complexities of the municipal securities market. Why Choose MSRB? Expertise: With a dedicated team of professionals and a comprehensive understanding of the municipal securities landscape, the MSRB is a trusted authority in the industry. Commitment to Integrity: We prioritize the protection of investors and the public interest, ensuring that our rules and practices uphold the highest standards of integrity. Community Engagement: The MSRB actively engages with market participants, regulators, and the public to foster collaboration and dialogue on key issues affecting the municipal securities market. Get Involved Stay informed about the latest developments in the municipal securities market by visiting our website at msrb.org. Whether you are an investor, a municipal advisor, or a member of the public, we invite you to explore our resources and join us in promoting a transparent and efficient municipal securities market.

When a crypto-asset is considered as a financial instrument under #MiFID II and not #MiCA? (Quick overview of the last ESMA consultation) ⚠️whether a CA should be considered a financial instrument should remain a case-by-case exercise. 👉Guidance only. 1️⃣ When a crypto-asset is classified as a transferable security? When grant rights similar to shares, bonds or other securities (e.g. securities embedding a derivative). - It should be part of a « class of securities » In order to form a class, crypto-assets are generally viewed as (i) interchangeable, (ii) issued by the same issuer, (iii) having similarities, and (iv) providing access to equal rights. - Must be negotiable on the capital market - Should not be an instrument of payment. 2️⃣ When a CA is classified as a money-market instruments? - Having a legal and residual maturity as required for in the Money Market funds regulation - Exhibiting stable value and minimal volatility and - Aligning returns with short-term interest rates. a CA that would function as a representation of a short-term debt commitment issued and endorsed by a government, should also be classified as a MMI. a CA that represents a short-term negotiable debt obligation issued by either a bank or a corporation. 3️⃣ When a CA is classified as a unit in collective investment undertakings? Qualification of an entity as a collective investment undertaking: - Absence of a general commercial or industrial purpose of the entity, - The pooling together of capital raised from investors for the purpose of investment with a view to generating a pooled return for those investors, and - The absence of day-to-day control of the unitholders or shareholders over the entity. The CA should encapsulate capital raised from a number of investors for the purpose of investment with a view to generate a pooled return for the benefit of those investors. 4️⃣ When a CA is classified as a derivative? - Digital representation of a contract - Have an underlying reference, which determines its value. - The value of the crypto-asset should fluctuate based on changes in this reference asset. - An agreement between involved parties, detailing the terms, maturity (if any), price and other conditions, without necessarily be a compulsory condition or a criterion. Derivative contracts relating to a CA, a basket of CA or an index on CA as an underlying should be qualified as financial instruments within the meaning of MiFID II as it captures derivative contracts, which refer to an underlying such as assets, rights, obligations or indices. 5️⃣ When a CA is classified as an emission allowance? - must represent a right to emit a specified volume of greenhouse gases and comply with the EU Emissions Trading Scheme or an equivalent framework. - should grant an explicit emission right and be tradable. General note💡A substance over form approach needs to be adopted to determine if a CA is qualified as a financial instrument.

I've long held the view that the Indian Government has made the right step in first differentiating between crypto and asset backed / reference tokens. The next leap is in identifying the nature in which a VDA is utilised - as a security, commodity, derivative, money market instrument, or currency. Cryptocurrency exists in that grey area which requires the regulator to create new laws for the burgeoning economic potential of DLT based financial assets. #adoptdontstop #bringitonchain #thefutureofassetownership

As the regulatory landscape that our market operates within is ever expanding, this horizon scanner will help firms engaging in securities lending to navigate the waters ahead. Upcoming elections in major jurisdictions and a potential shift in the political landscapes will likely bring new perspectives and priorities around financial services legislation, directly and indirectly impacting our market in 2024. I look forward to discussing these in further detail with members in the coming weeks!

#ESMA #SFTR #financialstability ESMA publishes first overview of EU securities financing transactions markets The ESMA market report on EU securities financing transactions (SFT) markets provides first comprehensive market-level overview of the EU repo market, based on information reported by market participants. It contributes to ESMA’s financial stability objective, by monitoring repo market developments and providing key risk metrics for its monitoring framework on securities financing transactions. The main findings of the report are:  SFT markets overview: The total outstanding exposure of SFTs was EUR 9.8tn in September 2023. Repos accounted for EUR 6.7tn or 68% of the total, securities lending for EUR 2.3tn (23%), buy-sell back for EUR 743bn (8%), and margin lending for EUR 124bn (1%). Repo market participants: Banks are the major participants in repo markets with 52% of repo amounts, and are predominantly concentrated in a few EEA jurisdictions, with France as the primary domicile holding 55% of EEA repo borrowing and 53% of EEA repo lending in September 2023. Other main countries include Germany (17% borrowing / 19% lending), Italy (7% borrowing / 5% lending) and Ireland (5% borrowing / 6% lending). Cross-border linkages: 41% of the repo amounts observed are between EEA counterparties. Links with the UK are strong, with EEA repo borrowing from the UK amounting to 12% of repo amounts, and EEA lending to the UK to 9%. Clearing & settlement: 61% of repo transactions are uncleared, with 55% processed bilaterally and 6% managed with a third-party. Repo collateral use: Government bonds are the main collateral employed. The cleared segment predominantly makes use of EEA sovereign bonds (88% of collateral), while the non-cleared segment features slightly more collateral heterogeneity (79% of sovereign bonds as collateral). Repo haircuts: Since CCPs collect margin at the portfolio level using proprietary risk models, cleared repos often report zero haircuts at the transaction level. This contrasts with higher haircuts in non-cleared transactions, especially when involving a more diverse pool of asset classes. Non-cleared repos backed by government bonds often display no haircut.  The Securities Financing Transactions Regulation (SFTR) created a Union-wide framework under which details of SFTs can be efficiently reported, responding to the need to enhance the transparency of securities financing markets. ESMA will continue to monitor and analyse risks in SFT markets. Best regards, Hartmut Renz Further details, please see: https://lnkd.in/ehF9VwPy

ISLA is pleased to announce the publication of its 2024 Securities Lending Regulatory Horizon Scanner in collaboration with Clifford Chance From Basel 3 to SFTR, the Scanner provides a high-level overview of key ongoing and expected EU and UK regulatory developments that are likely to have an impact on the industry over approximately the next 2 years. Developments are grouped thematically and there are also spotlight sections on US developments relating to reporting of stock loans and short selling as well as certain EU tax-related developments. To access and download the paper visit: https://hubs.la/Q02kVkq50 Many of the regulations outlined are covered within ISLA’s Working Groups, which you can find out more about here.https://hubs.la/Q02kVl7D0 #ISLANews #securitieslending #securitiesfinance #Regulations #CliffordChance

🗞 On August 19, 2024, the International Capital Market Association (ICMA) and the International Securities Lending Association (ISLA) jointly announced the release of the Digital Assets Annex. This new annex to the Global Master Repurchase Agreement (GMRA)* introduces a standardised framework and set of terms designed to facilitate the documentation of repo transactions involving digital assets. These include transactions collateralised by, or involving payment in, digital cash, digital securities—such as tokenised traditional securities—and asset-backed digital assets. * According to ICMA, the GMRA serves as the primary master agreement for cross-border repos worldwide and is also widely used in many domestic repo markets. Announcements: https://lnkd.in/eARk6Sr5 and https://lnkd.in/eVuPQax4.

Another research article in MixBytes' blog by our auditors/researchers, describing an interesting case with balances and invariant integrity in Aave markets. The article "Investigating Balance Integrity in Aave Markets" is here: https://lnkd.in/e2TgZwwD #defi #smartcontracts #audit

Requirements For Authorisation As A Post Trading Service Provider In The UK In the UK, becoming an authorised post-trading service provider involves a comprehensive process that ensures the provider can operate within the legal and regulatory framework set by the Financial Conduct Authority (FCA) and other relevant authorities. Here is an outline of the steps and requirements involved in obtaining authorization: 1. Understanding the Regulatory Framework Key Regulations The Financial Services and Markets Act 2000 (FSMA): Provides the foundation for financial regulation in the UK. The Markets in Financial Instruments Directive II (MiFID II): European Union legislation that the UK adhered to, governing firms that provide services to clients linked to 'financial instruments' (shares, bonds, units in collective investment schemes, and derivatives), and the venues where those instruments are traded. The Central Securities Depositories Regulation (CSDR): Regulates Central Securities Depositories (CSDs) in the EU, applicable to entities involved in post-trading activities such as the safekeeping and settlement of securities. UK's Uncertificated Securities Regulations (USRs): Governs the transfer of title to securities without a written instrument, relevant to entities providing clearing and settlement services. 2. Types of Post-Trading Service Providers Central Counterparties (CCPs) Firms that facilitate trading in various securities by becoming the buyer to every seller and the seller to every buyer. Central Securities Depositories (CSDs) Entities that provide the infrastructure for securities settlement, holding securities in electronic form and facilitating their transfer between accounts. 3. Application Process Pre-Application Initial Discussion: All role payers in the application (not consultants)will engage with the FCA early to discuss the nature of the business and understand the regulatory requirements. Documentation: Prepare necessary documentation, including a detailed business plan, financial projections, governance structure, and risk management framework. Application Submission FCA Application: Submit the application to the FCA after paying the prerequisite fees, providing comprehensive information about the firm, its activities, management, and compliance with regulatory requirements. Form A: Information about individuals performing controlled functions. Form E: External business interests and directorships. Business Plan: Detailing the operational model, technology infrastructure, and compliance strategies. Risk Management Framework: Including details on how the firm will manage operational, financial, and legal risks. See Key Requirements On Next Post

Should prop firms be subject to the same regulations as FX/CFD brokers? Head over to Finance Magnates, as Greg Rubin, Head of Axi Select at Axi, shares his insights on this important topic. Read all about it here: https://bit.ly/4cBFfDJ  𝖯𝗋𝗈𝗆𝗈𝗍𝖾𝖽 𝖻𝗒 𝖠𝗑𝗂𝖳𝗋𝖺𝖽𝖾𝗋 𝖫𝗍𝖽. 𝖢𝖥𝖣𝗌 𝖼𝖺𝗋𝗋𝗒 𝖺 𝗁𝗂𝗀𝗁 𝗋𝗂𝗌𝗄 𝗈𝖿 𝗂𝗇𝗏𝖾𝗌𝗍𝗆𝖾𝗇𝗍 𝗅𝗈𝗌𝗌. 𝖭𝗈𝗍 𝗂𝗇𝗍𝖾𝗇𝖽𝖾𝖽 𝖺𝗌 𝗂𝗇𝗏𝖾𝗌𝗍𝗆𝖾𝗇𝗍 𝖺𝖽𝗏𝗂𝖼𝖾. 𝖭𝗈𝗍 available 𝖿𝗈𝗋 𝖠𝖴, 𝖴𝖪, EU 𝖺𝗇𝖽 𝖭𝖹 𝗋𝖾𝗌𝗂𝖽𝖾𝗇𝗍𝗌. #axi #TradeYourEdge #trading #forex