Despite Brexit, MiFID (II) is here to stay
The launch of the Markets in Financial Instruments Directive (MiFID) II is fast approaching. With ongoing regulation updates released by the Financial Conduct Authority (FCA) throughout 2017, time is running out for financial services firms to take the initiative in preparing for the 2018 implementation
Less than one week after Article 50 was triggered, the FCA published its first policy statement on the near-final rules of MiFID II. The EU legislation is set to come into force on 3 January, 2018, affecting the UK market regardless of Brexit talks. The regulator’s policy statement focuses on several areas, ranging from market issues to client assets to the use of third parties to provide transaction reports by investment firms. An update on the FCA’s proposals for recording telephone conversations is also provided.
Published along with the FCA’s fifth consultation paper on MiFID II, the policy paper provides another opportunity for firms to voice concerns and suggestions surrounding the regulation.
The FCA’s ultimate verdicts will be available in June 2017, when the second and final policy statement is released. In the meantime financial services firms in the UK should take proactive steps in preparing for MiFID II.
Understanding changes introduced by MiFID II is crucial, as it effectively alters the scope of regulated activities in the UK. Providers whose business (or parts of it) has not required regulatory supervision so far but will need it under MiFID II must apply and receive authorisation on time – otherwise they risk being unable to conduct business in the UK.
The FCA publishes consultation papers on an ongoing basis, which allow firms to respond to developments in financial regulation in the hope of securing a better understanding of key issues from the perspective of firms. Thanks to the open nature of consultations, financial services providers can also better understand the concerns of their peers and regulatory changes across the wider industry.
A second opportunity is reviewing materials such as the FCA’s Handbook guides. After the second policy statement is published in June the FCA will create guides that provide insight into understanding MiFID II requirements, as well as a table illustrating how and where it is to be implemented throughout UK legislation.
Financial services firms will do well to reference the Handbook guides as they will prove useful in navigating the UK’s regulatory landscape.
Some of the UK financial services firms we have interviewed at GlobalData admit that they remain uncertain about how to prepare for upcoming changes. With less than one year until the MiFID II update takes effect, financial services firms have no choice but to take the initiative and approach the regulator for guidance where required.
UBS net profit soars 79% in Q1
Swiss wealth manager UBS has reported a net profit of CHF1.26bn, a jump of 79% from CHF707m reported a year ago.read more
RBS private banking operating profit rises in Q1
RBS private banking unit has reported an operating profit of £33m for the first quarter of 2017, more than three-fold surge compared to £10m in the year ago quarter.read more
Invesco to snap up ETF specialist Source
American asset manager Invesco has agreed to acquire Source, a UK-based ETF provider, from private equity from Warburg Pincus for an undisclosed sum.read more
Former Julius Baer Asia Pacific head to leave
Thomas Meier, the former Asia Pacific CEO at Julius Baer, has announced plans to quit the private bank at the end of October 2017 to pursue other activities.read more
Sequential partners Decimal to provide robo advice service
Sequential, a financial service consultancy based in Australia, has inked a memorandum of understanding (MOU) with Decimal Software to offer robo-advice service to its clients.read more