This month, the CEOs of firms under the cosh of the UK Financial Services Authority’s (FSA) new liquidity risk reporting regime received a letter from the regulator’s appropriately titled managing director of supervision, Jon Pain, asking them to pledge their compliance in writing. Given that the December deadline for the systems and controls part of the regime has been and gone, one would have assumed that this was enough of an indicator for firms that they need to be ready to be able to report in the required manner. However, the FSA obviously feels that too many firms out there are far enough behind to require a second warning.
As well as deciding to crack down on the pre-trade risk space this week (see 
This week the Securities and Exchange Commission (SEC) has yet again proved that it wants the industry to be afraid, be very afraid. Last year witnessed the appointment of Robert Khuzami as head of its new and improved enforcement division and the regulator has now added yet more members to the cause with the appointment of the leaders of five new specialised units. The agency has also added a new “cooperation initiative” aimed at making it easier for witnesses to give evidence in insider trading cases.
As predicted by A-Team Group last week (see 
Last year saw the transformation and empowerment of the Financial Services Board (FSB) to lead and monitor regulatory coordination across Europe. This year, the regulatory body has a significant list of tasks ahead of it to effectively put this function into practice, including coordinating the implementation of improvements to accounting standards and raising capital and liquidity requirements.
Following on from the publication of its risk related papers at the end of last year (see our coverage 
This year will see a wide scale review of MiFID, as promised by ex-internal market and services commissioner Charlie McCreevy last September (see our coverage 
The Bank for International Settlements (BIS) has invited a group of central bank representatives and CEOs of private sector financial institutions, including Citi and BlackRock, to meet in Basel this weekend to discuss the risk related challenges of the current market. The talks are a reaction to concerns about the possible return of “excessive risk taking” amongst financial institutions and will likely include significant debate about the recently released Basel Committee on Banking Supervision (BCBS) proposals (see our coverage 
Next week will see the resumption of discussions by the US Securities and Exchange Commission (SEC) on the subject of high frequency trading, dark pools and sponsored access (see the details of the meeting and contact information 
The Committee of European Securities Regulators (CESR) has published a new paper in order to provide firms with technical advice for data formats regarding fund mergers, master-feeder structures and notification procedures under UCITS IV. The advice has taken into consideration industry feedback on the measures, following a consultation period that ended in September, and indicates that more advice will be forthcoming regarding a central IT structure for data sharing between member states.
In light of the increase in cross border activity and foreign financial institution entry into European domestic markets over recent years, Anna Maria Tarantola, deputy director general of the Bank of Italy, has been talking up the need for common information sharing methodologies and central databases across Europe. Last year, Tarantola discussed these issues with a banking delegation in Milan and stressed the need for increased cooperation between regulatory bodies in terms of data elements and organisation.
At the end of last year, Philipp Hildebrand, vice chairman of the governing board of the Swiss National Bank, indicated that the central bank has already started the ball rolling with regards to introducing new liquidity and capital requirements. Much like the rest of the world, the regulator is awaiting and will follow the Basel Committee on Banking Supervision (BCBS) consultation, which is due to be finalised at the end of this year.
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The systems and controls aspects of the UK Financial Services Authority’s (FSA) liquidity risk regime may be in force, but it seems quite a high percentage of readers are not yet in compliance. The “Dear CEO” letter sent by managing director of supervision, Jon Pain, this month is seemingly warranted given that many of you are still only in the first stages of considering investing in liquidity risk management for compliance purposes.
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