As the UK prepares to gradually reopen the economy over the coming weeks, all eyes now turn to how the (re)insurance industry will adapt to the ‘new normal ‘. While companies remain divided over whether the recent trend of homeworking will continue (HSBC boss Noel Quinn scraps executive floor at London HQ), two points remain clear:
Following regulatory forbearance due to Covid and the resultant extensions to the implementation dates, it is time to review arrangements to comply with UMR. The number of in-scope entities will drastically increase as we near the Phase 5 & 6 dates. Entities will be subject to the rules from 1st September 2021 if the aggregate month-end average notional amount is above EUR 50 billion and from the 1st September 2022 if above EUR 8 billion. This will bring into scope over a thousand firms and result in a requirement to re-paper clients accordingly. These amounts equally apply to the UK as the recent consultation by the PRA & FCA outline some proposed changes but do not convert the pre-Brexit notional amounts to GBP.
In our whitepaper, What to look for when selecting a treasury management system, we included a section on digital currencies. The whitepaper referenced our blog from just over a year ago (An unanswered question from Davos) that posited the question of when we would activate our Crypto/Digital/CBDC functionality in our treasury, sales and trading systems. At that time, we had undoubtedly seen a series of decisive moves on CBDC’s and stable coins. A year on, we see strong institutional uptake for cryptocurrencies from asset and wealth managers and an emerging interest from corporates. These are the customers of banks, and so it is likely that the coming weeks will feature news of banks looking to offer trading and post-trade capabilities for this emerging asset class.
Following on from our previous blog ‘Exploring Captive Solutions in a Hardening Market’ we decided to highlight the top three considerations to drive efficiency by controlling costs.
Recently formed captives often use third-party service providers to run their day-to-day business operations, including core activities such as claims handling.
Banks have always been top of the food chain. The threat of FinTechs (Challenger Banks are included in that term here) have done little to change that fact in terms of numbers of customers and sheer size. When the phenomenon of FinTechs hit the banking scene it was very much as competitors.
Elf on the Shelf is a simple concept that has proved to be immensely popular. It is based on a book of the same name which sets the scene for the concept. The story describes how Santa's "scout elves" hide in people's homes to watch over events. Once everyone goes to bed, the scout elf flies back to the North Pole to report to Santa the activities, good and bad, that have taken place throughout the day. Before the family wakes up each morning, the scout elf flies back from the North Pole and hides, and typically is portrayed to be quite mischievous!
Markets appear, according to commentators, to be pricing in a last-minute deal between the European Union and the United Kingdom. This would certainly fit various other scenarios we have seen with last-minute eleventh-hour deals involving the EU.
Following on from the MAR report in my last blog comes one on a consultation from ESMA concerning the Organised Trading Facility (OTF) Regime. The accompanying paper provides an overview of the functioning of the OTF regime. It discusses the definition of OTF’s, the use of discretion in the execution of orders and the practice concerning the use of matched principal trading.
As we approach Halloween market abuse has come back to haunt the FX market. Our Advent Blog last year covered the ESMA Consultation Paper on the provisions of the Market Abuse Regulation (MAR) and highlighted the fact that spot FX is not covered by MAR.
While reviewing our recent White Paper “Captive Insurers - The Risks and Opportunities in a Hardening Covid-19 Market”, I was struck by the dilemma that companies face. Even without the unprecedented challenges to the market in 2020, corporate risk managers may feel that there is little they can do to rescue themselves from coverage risks and rising costs. Does technology offer a new way to handle these problems?
For some time in the UK the regulators and authorities have tried to introduce true competition to the traditional banks. Much debate has occurred as to the rights and wrongs of allowing a new grouping of Challengers, Neos and FinTech enter the banking market with a lighter regulatory touch to the incumbents.