Dodd-Frank, EMIR and other regs drive buy-side to explore new tech options at TSAM Europe

13 March 2013

A third of hedge funds, investment banks, broker-dealers and exchanges have said they are not yet ready to deal with a raft of new incoming regulations, such as the requirement to clear over-the-counter (OTC) trades via clearing houses, according to the ‘2013 OTC Derivatives Trading Trend Survey’ from telco connectivity provider, IPC Systems.

With two thirds of the surveyed financial market participants only slightly prepared for regulations such as Dodd-Frank in the US and the European Market Infrastructure Regulation (EMIR), the TSAM Europe trade show, which is aimed at asset managers on the buy-side and gets underway on 19 March at the Lancaster London Hotel, is expecting a bumper attendance this year. Almost a thousand people from the industry are expected to gather to listen to more than 100 speakers across 40 sessions and seven streams, or to view the 45 exhibition stands showcasing the latest technology in this area that can aid compliance and help firms meet increased post-crash reporting requirements.

The emerging global regulatory picture for portfolio and investment management requires greater efficiency in operations and client servicing. While differing slightly in Europe and the US, there are also considerable new post-crash reporting requirements. Under EMIR in Europe, for instance, many buy-side financial market participants will be subject to OTC clearing and reporting obligations coming into force mid-March 2013. The US and Far East are also introducing this G20 requirement [see the links in this story for an overview of some of the regulatory requirements -Ed].

In Europe, fund managers are also under pressure to the meet the 2015 implementation date of the Alternative Investment Fund Management Directive (AIFMD) which focuses on developing EU-wide, harmonised regulatory standards for shadow banking. In the US, the Dodd-Frank Act has already changed the regulatory and reporting requirements of hedge fund advisers, requiring further investment into compliance and technology; all of which will be on display at TSAM Europe 0n 19 March.

In addition to meeting regulatory requirements, slashed budgets and rising market data costs are increasing pressure on buy-side firms. One area asset managers have looked to increase efficiency is new technologies, and the focus is shifting to the IT department’s contribution to the business.

Traders and portfolio managers are handling more products, in a shorter time period and with higher risk awareness, and therefore need to rely more than ever on their front office technology. Panellists from the ‘Front Office Technology Stream’ at TSAM Europe, including Robert Strong of Fidessa, Arjuna Upasena of Nomura Asset Management, and Louis King of First Boston Capital Markets, will discuss this topic at TSAM Europe, while also covering cost management, the innovation v legacy debate, and the rise of ‘big data’.

According to Matthew Oakeley, head of group IT at Schroders: “There is an emergence of sufficient new technology, aimed at the desktop and mobile productivity space, that one might describe the time as right for the prominence of a chief technical officer (CTO) role in asset management to come to the fore. Technologists who can talk coherently and with vision at senior business levels about these new technologies will become increasingly important. This is a shift, as for many years IT infrastructure topics have rarely needed that sort of profile.”

• You can view the agenda of TSAM Europe 2013, which Bobsguide is a media partner of, HERE.

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