Posts tagged 'ICAP'

No more Mr Libor

Derivatives Broker 1:


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A new word to you? Yes, well, we were searching for a suitable adjective to describe this:

20 June 2013
Tullett Prebon plc

Statement in relation to court proceedings

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Very large crude carrier negativity

Here’s a nice chart from Icap’s Global Shipping Analytics team demonstrating the current cash-burn the Very Large Crude Carrier (VLCC) market is experiencing:

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The disappearing Spanish GC repo market

Thanks to Mario Draghi’s double installment of 3-year LTROs this year and last, it’s been a while since we’ve had to worry about dysfunctions in the European repo market. Indeed, it wasn’t that long ago that the market’s problems appeared fully contained. But, could we have spoken to soon?

News now comes to us of another case of “causation or correlation?” striking European bond markets. This time relating to Spanish collateral. Read more

Brokers suspended in Libor inquiry

More than a dozen traders and brokers in London and Asia have been fired, suspended or put on leave by their employers as a multinational probe into alleged manipulation of crucial global lending rates accelerates, reports the FT. Regulators have been investigating US and European banks that help set interbank lending rates in London and Tokyo since late 2010, in an intensive profile inquiry that spans three continents and involves at least nine separate enforcement agencies. Icap, the world’s largest inter-dealer broker, has suspended one employee and put two more on administrative leave in the past six weeks. Icap declined to comment beyond noting that it was “co-operating fully” with authorities and had disclosed the official requests for information late last year. The story cites people familiar with the probe as saying traders have also been suspended, fired or placed on leave in recent months at Deutsche Bank, JPMorgan Chase, Royal Bank of Scotland andCitigroup. All four banks declined to comment. Regulators sought information from the three interdealer brokers that dominate the rates market – Icap, Tullett Prebon and RP Martin, looking at information-sharing among brokers, hedge funds and banks, the sources said. An RP Martin spokesman said the firm was not under investigation and declined to comment on suspensions. A Tullett Prebon spokesman said the firm had not suspended any employees. Separately, the FT reports the US authorities are modelling their investigation on an earlier prosecution of three energy companies for violations of the Commodity Exchange Act, which resulted in criminal settlements and prison terms of up to 14 years.

European repo has been contained!

From Icap’s latest repo weekly report:

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Collateral squeeze as strong as ever, Icap says

Oh dear. So much for the big Draghi LTRO helping out the Eurozone collateral crunch.

According to Icap’s latest repo makret report — and remember they operate the dominant electronic repo platform in Europe, Brokertec — the collateral crunch hasn’t eased at all. Read more

Snap news

Breaking pre-market news on Wednesday,

– Unicredit prices capital increase at €1.943 per share — Reuters. Read more

More on the collateral crunch

From the ECB’s Mario Draghi on Thursday (our emphasis):


Icap tests systems for eurozone collapse

Two big operators in foreign exchange markets are preparing for scenarios in which some eurozone members return to their previous currency, says the WSJ.  ICAP said it was preparing its electronic trading systems for a possible return of the Greek drachma. CLS Bank International, which operates the largest forex settlement system, said it was running “stress tests” to prepare for a euro break-up, the newspaper also reported, citing people familiar with the matter. The FT says Icap’s move follows discussions with clients – largely dealer banks – and third parties such as CLS, a settlement system for currency trades, about the need to be prepared for “any number of possible outcomes”, said Ed Brown, executive vice-president of business development and research at Icap Electronic Broking.

Eurozone GC is splitsville

Something strange is up in the world of ‘General Collateral’. And since eurozone funding markets are increasingly dependent on collateralised rather than unsecured loans, these are important developments that could be influencing rates elsewhere.

Nothing tells the story better than these charts, courtesy of Icap — a key repo market broker. What they pinpoint is a seemingly diverging attitude towards the various  bond markets that make up so-called general collateral (GC) in the Eurozone, as far back as July this year: Read more

Snap news

Breaking pre-market news on Wednesday,

– LSE says income from its Italian clearing business up 225 per cent from a year ago — statementRead more

Icap protest over transactions tax

Michael Spencer, the CEO of Icap, told analysts on a call yesterday that his company would move away from London if the proposed financial transactions tax were to go ahead, the FT reports. Icap is the world’s biggest interdealer broker when measured by trade volumes. According to Spencer, if the levy were introduced, “the wholesale financial market will evaporate from Europe.”

Snap news

Breaking pre-market news on Thursday,

– Thomas Cook shelves dividend; working with lending banks — statementRead more

Snap news

Breaking pre-market news on Wednesday,

– Icap says full-year pretax profit up 4 per cent – statement. Read more

What Libya crude cuts mean for tanker rates

Icap’s shipping analysts have on Monday come up with an interesting hypothetical take on how an extended Libyan crisis might impact the shipping market.

In a nutshell, think more bearish than bullish for shipping rates. Read more

Europe’s FICC woes

The reporting season for Europe’s investment banks starts this week and expectations are not high…

From Monday’s FTRead more

Snap news

Breaking pre-market news on Tuesday,

– HSBC placing 6m Icap shares for chief executive Michael Spencer — statementRead more

Renminbi begins offshore electronic trading

Thomson Reuters and the broker-dealer ICAP are in talks with US and European banks about trading the renminbi on electronic platforms for the first time, according to the WSJ. Both companies began allowing electronic trading in Hong Kong last week among a small group of traders. But the talks are a milestone for liberalising the role of the renminbi in international currency markets, moving beyond the current restriction of its offshore spot market to over-the-counter trading by Hong Kong banks. Even so, variations between the offshore spot and onshore markets could cause headaches for the Chinese authorities, which strictly regulate the latter. Of course, the renminbi would be entering a surging market. Daily trading volume in spot FX has jumped 50 per cent to $1.5tn since 2007, The Banker reports.

Snap news

Breaking pre-market news on Thursday,

– Ireland puts maximum Anglo Irish bailout cost at €34.3bn — statementRead more

Banks turn to Spanish bonds

International banks have used a record amount of Spanish government bonds as collateral to borrow money in the markets this week, driving hopes that the eurozone’s credit problems are easing, reports the FT. Short-term loans, backed by Spanish bonds in repurchase agreements had hit €160bn by Wednesday this week, according to Icap’s BrokerTec, a platform for raising money in Europe.

Explaining the Baltic Dry sell-off

FT Alphaville, and others, watched the Baltic Dry’s recent 60 per cent tumble, which took place over a run of 35 consecutive days, with particular interest.

Some, after all, suggested that it meant the index was no longer a valid economic indicator. Other worried that it was just that. Read more

Snap news

Breaking pre-market news on Wednesday,

– LSE posts Q2 revenues of £158.2m, new issue activity down — statementRead more

Icap under FSA scrutiny

Icap, the world’s largest inter-dealer broker, has become a target of the UK’s FSA, as the regulator orders banks and brokers to hire outside experts to scrutinise their operations, reports the FT. The City watchdog earlier this year issued Icap with a so-called 166 notice, under which the FSA can commission reports – often by one of the big auditors – into the firm’s activities. The FSA used this power in 56 cases in 2008/09, nearly double the number in 2007/08 and is expected to disclose the latest figure in its annual report due Thursday.

Snap news

Breaking pre-market news on Wednesday,

– Icap says it made a good start to new financial year, to pay dividend of 17.55p – statementRead more

Interest rate swap data made public

TriOptima, a European securities post-trade specialist owned by ICAP, has made data showing details of interest rate swaps contracts publicly available for the first time, the FT reports. The move would appear to be a sign that regulators’ demands for more transparency in the over-the-counter derivatives markets are being met.

Snap news

Breaking pre-market news on Wednesday,

– Easyjet confirms Carolyn McCall as new CEO – statement. Read more

The costs of closing a stockbroking business

Another unpleasant surprise for the shareholders of ICAP, the inter-dealer broker run by outgoing Conservative party chairman Michael Spencer.

From RNS on Monday: Read more

Snap news

Breaking pre-market news on Monday,

– Icap to close most of its cash equities business in Europe and Asia – statementRead more

Who’s stalking Tullett?

The M&A log jam is begining to break.

From the RNS on Wednesday morning: Read more