AFME and Citi are today co-hosting a special event in Canary Wharf, as part of this year’s City Giving Day, to celebrate individuals from AFME Board member firms who have made an exceptional contribution to a charity or community group. While City Giving Day has historically focused efforts around the Square Mile, this year AFME wanted to spotlight the hard work of people working in Canary Wharf. Simon Lewis, Chief Executive of AFME, said: “So many firms, not just those in the City, do a great job supporting charitable and community projects, but we don’t always hear about them. AFME wanted to extend City Giving Day to celebrate some of the remarkable individuals in Canary Wharf who have made a significant contribution to the community.” “We hope that by highlighting the efforts of some of our member firms, the public sees that giving back to society is important for this sector. Whether inspiring colleagues to participate in fundraising activities, or supporting deserving organisations, there is a range of community activity represented today.” Among the member firms with individuals receiving certificates for their contributions are: Bank of America Merrill Lynch, Barclays, BNY Mellon, Citi, Crédit Agricole, Credit Suisse, Lloyds Bank, Nomura and UBS. At the celebratory event hosted at Citi’s offices in Canary Wharf, award nominees will hear from guest speaker, Alderman Peter Estlin, Sheriff-elect of the City of London, as well as AFME Board member, Leo Arduini, Head of Markets in EMEA at Citigroup.

Following President Juncker’s 2016 State of the Union address and the communication from the European Commission setting out next steps to accelerate the completion of Capital Markets Union (CMU), Simon Lewis, Chief Executive of the Association for Financial Markets in Europe (AFME), commented: “President Juncker’s commitment to completing the Capital Markets Union is a strong signal of the Commission’s focus on creating economic growth and jobs across Europe.“We strongly support the focus on insolvency reform and boosting infrastructure funding in the next phase of CMU, and we are hoping for quick completion of the measures on securitisation and the prospectus regime. “It is vital that the CMU project works for every EU Member State by channelling much-needed capital market finance to high-growth firms and infrastructure projects across Europe.“As the trade group representing Europe’s wholesale markets we are committed supporters of the Commission’s initiative on CMU and will continue to do all we can to help make it a reality.” - Ends -

AFME has today published a new report entitled Principles of Asset Segregation, Due Diligence and Collateral Management, which calls for greater harmonisation of asset segregation across European regulation. Segregation of client assets currently falls under various pieces of EU regulation (including AIFMD, EMIR, CSDR, UCITS V and MiFID/MiFIR), however, the report finds there is currently no consistency in the meaning of “account segregation” across the regulations nor in the level of segregation required. The report, therefore, calls for a harmonised approach to ensure a high standard of securities account holder protection whilst also acknowledging the consequences of differing insolvency regimes. Werner Frey, Managing Director of the AFME Post Trade division, said: “EU regulations currently create a fragmented approach to account segregation. Given this patchwork of legislation, asset segregation lacks coherence and creates a level of uncertainty and confusion among industry participants. This is why we have developed a list of principles to provide a holistic view of asset segregation for European policymakers and financial institutions.” The AFME report contains a comprehensive analysis of existing and proposed regulations that impact client asset protection, focusing primarily on Europe, but with consideration of the broader global context, given the nature of the markets in question. This is followed by a set of principles for segregation of client assets and client account holding structures, which are based on the conclusion of this analysis. These principles focus primarily on securities accounts, from a holistic operational, legal and compliance perspective, which simultaneously ensure adequate safety of client assets while minimising operational complexity and cost. Among some of AFME’s key Asset Segregation Principles are: Internal accounts should be fully segregated and identify the immediate client for whom the assets are being held; External accounts should be segregated between proprietary assets and securities account holder assets; In the event of the insolvency of a securities account provider, client asset protection is of utmost importance. Download Principles of Asset Segregation, Due Diligence and Collateral Management

The Association for Financial Markets in Europe (AFME) has today published model clauses for the contractual recognition of bail-in for the purposes of satisfying the requirements of Article 55 of the EU Bank Recovery and Resolution Directive (BRRD). The model clauses seek to support cross-border effectiveness of resolution and assist banks with complying with the requirements of Article 55 BRRD by providing model wording for inclusion in debt instruments and other contracts. Commenting on the publication of the model clauses, Oliver Moullin, Head of Recovery & Resolution and General Counsel at AFME, said: “AFME’s model clauses for the contractual recognition of bail-in should support cross-border effectiveness of resolution and assist banks in meeting the requirements of Article 55 BRRD. However, very significant challenges remain and the scope of Article 55 should be amended to align it with the international standard, increasing consistency and clarity for the market.” Continued concerns with the scope of Article 55 BRRD The scope of Article 55 is very broad and requires banks to include contractual recognition clauses in contracts giving rise to all liabilities governed by non-EEA law, save where these are expressly excluded from bail-in under the BRRD. The requirement gives rise to significant challenges, for example where banks are unable to unilaterally amend contracts, such as in relation to trade finance and membership of financial markets infrastructure.A number of authorities have acknowledged that in many cases inserting such a clause is impracticable. While several authorities have sought to adopt a pragmatic approach to implementation, there remains uncertainty and potential inconsistency in application. A clear and consistent approach across the European Union is required to provide banks and counterparties with a clear and workable solution. AFME believes that the scope of Article 55 should be amended to align it with that agreed at the international level through the Financial Stability Board (FSB). These principles propose that the scope should cover instruments eligible for loss absorbing capacity requirements and any other “debt instruments”. This would provide a much clearer scope of liabilities and significantly reduce the impact on firms while meeting the objective of ensuring resolvability. Alignment with the FSB principles is particularly important where inconsistencies in approach could severely impact the competitiveness of European banks operating in global markets. – Ends –

Commenting on the launch of the first Joint EU-US Financial Regulatory Forum, Simon Lewis, Chief Executive at AFME, said: "AFME welcomes the launch of the EU-US Joint Financial Regulatory Forum which has the potential to build upon the transatlantic cooperation that the Financial Markets Regulatory Dialogue has already established. Beyond this welcome initiative, AFME recognises that more needs to be done to enhance international coordination and facilitate cross-border investment with a view to supporting the growth agenda in Europe. "We therefore believe this should be a first step towards including a framework for discussing financial regulation in the Transatlantic Trade and Investment Partnership (TTIP). TTIP offers the best opportunity for a forward-looking EU-US dialogue that can address issues early while also bringing the needed transparency and accountability that other mechanisms may lack”.

The legislative cycle after the 2014 European elections should be focused on long-term growth. As the new EuropeanCommissioners and MEPs look forward to the next five years, they have a key task – to introduce legislation that promotessustainable economic growth in Europe, so reducing unemployment and debt through improving the structure of the pan-European economy. Substantial progress has been made in establishing a framework of financial regulation that reduces the risk of the bankingsystem endangering the economy again. As that framework moves from legislation to implementation, it is time to focus onaddressing the growth agenda. The European Commission acknowledges in its ‘roadmap to meet the long-term financing needs of the European economy,that the funding model needs to be improved. Europe is too reliant on its banks for funding and needs to develop its capitalmarkets in order to improve the availability and cost of finance. As the Commission says,if long-term growth is to be improved, then companies need better access to large andliquid capital markets. This paper highlights the potential for high-quality securitisation in Europe to play apart in unlocking jobs and growth. Yet for it to do so, the proposed regulatory frameworkneeds to be sensibly calibrated – recognising risk, but also taking into account the strongperformance of high-quality securitisation in Europe over the past few years. We welcome the support of central banks and policymakers in calling for a revival ofhigh-quality securitisation, and stating that a revived and sustainable securitisationmarket would contribute to lower cost of capital, higher economic growth and a broaderdistribution of risk. In our view, there is an urgent need for coordinated action to revive securitisation. It would be a first step in helping Europe’sbanks fund their customers more efficiently. It would broaden the range of tools available to help them manage and transferrisk. And it would also help rebalance Europe’s financial system by widening and deepening its capital markets.

Commenting on the resignation of Commissioner Hill, Simon Lewis, Chief Executive of AFME, said: "Lord Hill has done an outstanding job in his time as Commissioner for Financial Stability, Financial Services and Capital Markets Union and in particular by championing the CMU project. There has been much achieved already, including the Cumulative Impact Assessment, for which he should be congratulated and we look forward to working with his successor Commissioner Dombrovskis on this important project. More than ever, given the events of the past few days, it is important that momentum towards delivering these initiatives to support economic growth and prosperity across the EU is maintained."

“The outcome of the EU Referendum and the UK’s decision to no longer continue its EU membership will shape the direction of Europe’s financial markets for years to come. “This decision will significantly affect UK-based financial services firms and their ability to serve their clients and customers across Europe."

An international group of fourteen trade associations and business groups today announced the formation ofa Transatlantic Financial Regulatory Coherence (TFRC) Coalition. The Coalition, which represents a largepart of the transatlantic financial services community, has been brought together by a strong and sharedbelief on both sides of the Atlantic that improving regulatory cooperation between the U.S. and EU must be apriority. It believes that a comprehensive Transatlantic Trade and Investment Partnership (TTIP) thatincludes both market‐opening measures and a framework for regulatory coherence in financial services isthe best way of achieving this.

The Investment Association and the Association for Financial Markets in Europe (AFME) have today paved the way for safer and better executed Algorithmic trading on Europe’s financial markets. Algorithmic trading is a key component of an investor’s ability to get the best price and execution for their clients. Therefore, it is vital that there is fair and accurate sharing of information between both sides about how any given algorithm operates - most notably between the investors and their broker/dealers. The industry has come together to proactively create this open framework, ahead of MiFID II, which supports Buy and Sell side in meeting their regulatory obligations. To ensure that there is a consistent methodology of how information is shared between each side of an electronic equity transaction, the Associations have created standardised questionnaires that outline the level of detail investors and broker/dealers will provide each other ahead of an electronic transaction taking place. The framework includes technical standards that a platform should meet in order to automate and facilitate the consistent sharing of information. The Associations are now calling on data vendors and suppliers to put forward their proposals to set up platforms that meet these Criteria. The Associations will not endorse or restrict their members to use any particular vendors’ platform. The framework for the Platform can be viewed here. - ENDS -