MiFID II – Mind Boggling

Truth be told, I’ve got a soft spot for MiFID – the Markets in Financial Instruments Directive that was introduced back in November 2007 to shake up Europe’s equity markets and create a common set of rules for a single market.

I cut my teeth on the regulation when I tore the thing apart to understand the impact that the introduction of MTFs would have on buy-side trading desks. I didn’t care too much about the regulation at the time per se because all I was focused on was designing trade execution algorithms, but it sure did give me an introduction into how regulations were coming of age!

Six years down the road and the same regulation is still paying my way :-), this time courtesy of the MiFID Review. The folks that are responsible for writing this stuff typically stick a date in the diary for ‘T+5 years’ to rectify things that didn’t quite play out first time round.

To be clear, the MiFID Review is a complex piece of legislation. It is made up of MiFID II, a huge overhaul of the original regulation, because technologically a lot has changed, and MiFIR, an amendment to EMIR, because the launch of the MiFID Review collided head on with the European response to global OTC swap reform. Continue reading

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Enterprise Regulatory Change – Practical Realities (Part III of III)

In the first part of this three part blog, I looked at the concept of ‘enterprise regulatory change’ and considered whether regulatory change initiatives, at the enterprise level, are even achievable, whilst in the second part, I looked at the implementation models for enterprise regulatory change and what this means at the programme level. In this final part, I want to look at the practical realities of implementing regulatory change and what this might mean to an enterprise-wide initiative.

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It’s kind of clear that the implementation-model-piece-of-the-jigsaw is the “in theory” part of the decision making process – great on paper, but not necessarily so great in practice – and that when you have to drill down into the level of thinking required to factor in the shape and size of the organisation, the decision making process really becomes a two dimensional one. Continue reading

Implementation Models for Enterprise Regulatory Change (Part II of III)

In the first part of this three part blog, I looked at the concept of ‘enterprise regulatory change’ and considered whether regulatory change initiatives, at the enterprise level, are even achievable.

In reality, the answer to this is “it depends”.

When I first thought about enterprise regulatory change, I thought that the key to achieving a successful enterprise-wide initiative would purely be a function of the sophistication of the implementation model.

But when you look at how it all comes together in practice, it’s clearly not so straightforward.

In practice, there are going to be many other different factors that determine how a regulation can be implemented across one business area versus how it can be implemented across another. Continue reading

What is Enterprise Regulatory Change? (Part I of III)

The financial crisis and the ensuing tsunami of regulatory change has forced many participants across the financial services sector to take a radically different approach as to how they manage their core businesses.

A tougher regulatory regime against bank capital structures has significantly dented profitability across many, once lucrative, business lines whilst the knock on effect through the value chain has ensured that the buy-side are not immune to these problems either.

Consequently, firms are being forced to take a holistic view as to how they manage their core businesses and the term ‘enterprise‘ is becoming an important word for banks and fund managers alike as they deploy strategic measures to reduce costs.

enterprise logo Continue reading

Efficiencies Derived from Regulatory Architecture

Under the weight of regulatory complexity, clients have been looking at how the traditional approaches to implementing regulatory change have struggled to deliver in recent years.

In a previous blog here, I looked at a solution that addresses just this and introduces the idea of deploying a Regulatory Architect to manage Regulatory Architecture.

In a follow-up blog here, I looked at the Role of the Regulatory Architect and how Regulatory Architecture embeds intelligent process and structure into the change programme, enabling the strategy to realise efficiencies that result in a faster and cheaper delivery.

So what efficiencies do Regulatory Architecture bring to the table? Continue reading

The Role of the Regulatory Architect: Bridging the Gap

In a previous blog here, I looked at why there is a business case for using Regulatory Architects to manage Regulatory Architecture.

If you have ever been involved in a regulatory change project, you will likely have experienced the many ‘pains’ that are encountered when trying to understand, let alone implement, complex regulations.

The role of the Regulatory Architect is to alleviate these pains by bridging the gap between the regulatory process and project delivery.

Bridging The Gap

So what are some of the tools that the Regulatory Architect might use to ‘bridge the gap’ and enable greater implementation efficiencies? Continue reading

Regulatory Architecture: A New Stategy for Managing Regulatory Change

When we look at a typical change program, we wouldn’t think twice about deploying an IT Architect to manage the IT Architecture or a Business Architect to manage the Business Architecture so when a change program involves complex regulations, why don’t we deploy a Regulatory Architect to manage the Regulatory Architecture?

Regulatory Architect

Regulatory change programs are unique to themselves and bring with them a different set of ‘pains’ that require different solutions to solve.

So what are some of the current ‘pains’ in the market? Continue reading