Archiv: May 2006

Swiss banking and finance education under one roof

Five months ago the Swiss Finance Institute (SFI) was created to consolidate the different existing education programs for banking and finance in Switzerland. The SFI is a private foundation created by the local banking and finance community together with several Swiss universities. The institute aims to advance research activity in finance and to support doctoral research and executive education in the banking and finance industry as well as organising interfacing activities between research and the industry.

The Swiss Finance Institute incorporates the International Center for Financial Asset Management and Engineering (Fame) and the Swiss Banking School. The Institute is supported by the Swiss banks, the Swiss stock exchange SWX, the universities and the Swiss federal government, which are all represented on the Foundation Board.

After a necessary time for preparation the SFI has now announced its ambitious goals. In fact, the SFI aims to achieve top-3 status in Europe and top-10 in the world with regards to research, executive training and PhD programs. For the research department the SFI has signed cooperation agreements with the universities of Geneva, Lausanne and Lugano. The University of Zurich and the Swiss Federal Institute of Technology (ETH) are expected to join this July. The SFI will co-finance professorships at these universities, organize PhD programs and support research projects. A total of 30 professorships should be created in the next 5 years in the partner universities.

Source: Finanz&Wirtschaft

London Stock Exchange offers choice of clearing provider

Yesterday the London Stock Exchange (LSE) announced that it has signed a letter of intent with SIS x-clear AG to provide member firms with a choice of clearing provider for equity trades.

The new arrangement would allow customers to choose whether to clear through SIS x-clear or through LCH.Clearnet, currently the sole clearing provider for LSE's equity business. LSE expects to deliver additional benefits to the market through competition in clearing services by introducing an independent, user-owned, user-governed and not-for-profit alternative provider.

Subject to final agreement, LSE proposes to offer the ability to clear through SIS x-clear during the first half of 2007. Development costs for member firms will be minimised by using existing legal and technology infrastructure where possible. Trades will continue to settle in CREST.

Source: London Stock Exchange

You may also read related topics posted on this Weblog:
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Measuring market noise

Last week, US stock exchange NASDAQ unveiled NASDAQ Market Velocity, a real time product that detects the level of market activity in NASDAQ stocks and alerts traders to events before they appear in price and volume information.

Market Velocity provides a technology version of market noise and activity levels found on a physical trading floor. The information is available simultaneously to all investors, not just to those physically present on a floor-based market. Market Velocity indicates the level of market activity in individual NASDAQ stocks by measuring the frequency and share volume in aggressively priced orders. It can indicate changes in market direction, momentum or liquidity in each stock, enabling users to imply future price movements and trends.

Select traders with access to a physical trading floor have historically detected changes in these levels on the floor via increased noise levels or visual indications such as individuals gathering in a particular location. These sensory cues could be used to detect trends, enabling the trader to capitalize on price movements before they happen.

Source: NASDAQ

Climate contracts gain importance

The Swiss private bank Bank Leu has recently decided to make climate contracts (CO2 market) available to all investors. For this purpose, Bank Leu issued a CO2 Certificate with the underlying future for the price of 1000 tons carbon dioxide (CO2) at the ICE exchange (formerly: International Petroleum Exchange). Bank Leu estimates that around 70 percent of the certificates have been purchased by private investors and the remaining 30 percent by institutional investors or business clients.

Source: Schweizer Bank magazine

Find out more about climate contracts, by reading this special feature (published in the realtime magazine, download 2.36 MB).

WTO stimulates stocke exchange of Vietnam

Two weeks ago the socialist republic of Vietnam reached an agreement with the US with the aim to join the world trade organisation WTO. Unlike the neighbouring country Cambodia, which joined the WTO some time ago, the dynamic of Vietnam's economic development makes it one the tiger states in the East-Asian region with growth rates only comparable to China. Vietnam's econonmy is growing at a medium rate of 7 percent and even saw a growth rate of 8.4 percent in 2005.

The stock exchange of Ho Ch Minh City (HSTC) reacted positively to the WTO announcement. The VN index which comprises the 36 listed companies has already been touching the 600 points mark. At the end of last year it had only shown a record of 250 points. Presently, the index is following the general Asian trend with a latest downwards correction to 545.39 points (- 8.7% in May).

Notwithstanding this latest correction, Vietnam's stock exchange now seems to pick up the dynamic of the booming economy and awake from its rather dormant fate. Since the launch of the HSTC six years ago the listed stock has been moving in untroubled waters. The vitalising push came from the new listed companies, such as REE, Vinamilk and Taya Vietnam, bringing the market capitalisation to $ 1.7 bln (which corresponds to a raise of 100 times).

The next bigger IPOs are expected from Sacombank, Vietcombank and a few telecom providers. With the IPO of the Saigon Thuong Tin Commercial Bank (Sacombank), which has an inofficial OTC market value of $ 900 million, HSTC is aiming at the $ 3 bln mark. According to the Finance minister, Nguyen Sinh Hung, the number of listed companies could double during 2006.

Source: NZZ am Sonntag

www presents wide open future

The real and virtual worlds collided this week in Edinburgh, as the past, present and future of the web was debated at the WWW2006 conference. It brought together 1,200 delegates from 46 countries, and saw FBI agents and suited captains of industry rub shoulders with academics from Togo and British healthcare workers.

Read the full story by BBC News:

Credit Suisse expands in Singapore

In May Credit Suisse announced that it has leased office space at One Raffles Quay to expand its Center of Excellence in Singapore. The new facility has a capacity for 1400 staff, of which roughly 900 positions will be filled by year-end 2007. Of this figure, the majority of staff will be local hires. At full capacity, Credit Suisse's expansion to One Raffles Quay will represent a significant increase of its workforce in Singapore to almost 3600 personnel. The new Center of Excellence at One Raffles Quay is the second such facility Credit Suisse has taken in Singapore, adding to an existing facility at The Signature, in Changi Business Park.

Source: Credit Suisse

Bank of China sale raises $9.7bn

Bank of China, the country's second-biggest lender, has raised $9.7bn (£5.2bn) from its share sale. Demand was strong and the sale was oversubscribed as investors tried to tap into strong growth and an expected surge in demand for financial services.

Read the full story by BBC News:

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China's stock exchanges stay on track

While global exchanges were falling sharply during last week, the two Chinese homeland exchanges Shanghai and Shenzen only came under pressure on Tuesday. Shanghai's A-share index still records a plus of 35% compared to January 2006.

Currently, 34 foreign institutional investors have a licence from the Chinese government to invest a total amount of $ 5.6 bln in China's financial markets. Considering a market capitalisation of $ 500 bln this isn't really a major dominance. China's homeland exchanges are still dominated by private investors who are more influenced by market rumours than by fundamentals. This may also explain the large volatility of these markets surging or plunging up to 5% on the same trading day. But some of the rumours are well-founded. A few days before, the Chinese government had announced measures to cool down the economy. So, there is some uncertainty how this will affect the earnings of the companies.

Chinese stock has gained additional momentum by the Chinese currency Yuan which is under a more flexbile currency regime since mid 2005. Last week, the Yuan broke the line of eight Yuan against the US-dollar for the first time. Many investors believe this to be the beginning of a broader development as the Yuan is still considered to be undervalued by up to 40% by currency experts.

Source: Finanz und Wirtschaft

Read more news articles on this topic:

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- Bank of China is preparing IPO

- Beijing's plan to boost Shanghai and Shenzen exchanges

- Bank of China's IPO - shunning the homeland

Telekurs Financial's database includes real-time prices and reference data on financial instruments from more than 200 stock exchanges. Get an up-to-date overview of the worldwide data range.

Sustainability funds are gaining ground

The market for sustainability funds is continuously growing. Presently, there are 800 investment funds worldwide issued under the sustainability label. In Switzerland the volume of sustainability funds reached 4.5 bln Swiss francs ($ 3.7) in 2005, while the worldwide market recorded a total volume of 565 bln Swiss francs ($ 468) in the same year according to fund information provider Lipper.

The growth of this segment would generally imply that yields of sustainability products show a better performance than traditional investment funds. In fact, some figures support this proposition. The Dow Jones Sustainability Index, for instance, recorded an absolute performance of 177% during the years until 2004, whereas the MSCI World index only progressed by 129% in the same period. This would support the theory that corporations with ethical, social and environmental values are more competitive in the long-term perspective. Experts believe that companies with a sustainability policy are able to cut down on costs due to a better energy and material management and that the better image of the company would also boost their profits. However, these theories are difficult to prove. A comparison shows similar performance histories for both sustainability and traditional funds. Some are outperforming the market and some are not.

Sustainability products might reflect the social and political views of its investor community. In the 60ies political issues were dominating fund policies primarily in the US and UK when arms, alcohol or tobacco industries were excluded from the investment list. In the late 80ies sustainability funds turned to environmental issues. In 1992 the United Nations Conference on Environment and Development confirmed the trend and also introduced the sustainability concept to a broader public. This trend also had an influence on corporate ratings. From then on companies were not only rated on their financial but also on their environmental performance. Specific funds were created to comprise the best rated. Later on some social and ethical values were added to the rating criteria. The actual trend goes towards renewable energy and Microcredit.

Yet, sustainability ratings are not beyond doubt. Firstly, there are numerous definitions of sustainability and, accordingly, numerous criteria to choose sustainability stock. Overall, fund managers have defined "positive" and "negative" criteria for their decision. Positive criteria may comprise the environmental policy or the working conditions of employees. The negative criteria can include the production of certain goods or the violation of working laws (child labour). In conclusion, the definition of sustainability much depends on the individual sustainability criteria of the fund managers.

Source: Neue Zürcher Zeitung

Telekurs Financial's database includes real-time prices and reference data on financial instruments from more than 200 stock exchanges. Get an up-to-date overview of the worldwide data range.

NYSE plans merger bid for Euronext

The New York Stock Exchange (NYSE) has unveiled plans to merge with the pan-European Euronext exchange.
The proposed move would create a transatlantic stock market giant worth $21bn (16bn euros; £11bn). If successful, the merger bid would trump rival plans by Germany's Deutsche Boerse for a tie-up with Euronext.

Read the full article by BBC News:

Read also the following news reports:

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- Euronext declines merger with Deutsche Boerse

- Deutsche Boerse proposes merger with Euronext

China set to be largest economy

China is set to become the world's biggest economy by 2026 according to a poll conducted on behalf of the BBC.
And India is poised to take over fourth place behind the US and Japan. India's infrastructure problems and scarcity of resources were seen as putting it at a disadvantage to China. The findings contradict a Goldman Sachs projection of the world's economies which had the US in top place in 2026.

Read the full article by BBC News:

How corporate actions affect trading in shares

Even routine corporate actions can have a significant impact on trading prices, trading volume and trade price volatility, according to a new report issued today by Oxera, an independent economics consultancy in Oxford (UK).

The report, called Share prices and trading activity over the corporate action processing cycle, studied five corporate action event types and how those events impacted share prices and trading activity. The five event types were: takeovers, stock splits, spin offs, rights issues and exchange offers. Most of the impacts studied by Oxera were corporate action events relating to U.S. securities, but the rights issue events studied involved a wide array of securities from the U.S., Europe and Asia.

The Depository Trust & Clearing Corporation (DTCC) sponsored the research by Oxera. Details of the paper will be discussed by Oxera and DTCC at the upcoming ISIPS conference on May 22 in London.

The complete report by Oxera is available for download at the DTCC Web site at (tip: insert the name of this study in the search window. It is the first item of the search results).

Source: DTTC press release, May 18, 2006

Read also related topics posted on this Weblog:
Virtual Reference Data Panel Discussion

Telekurs Financial's database includes real-time prices and reference data on financial instruments from more than 200 stock exchanges. Get an up-to-date overview of the worldwide data range.

First Swiss software tool for assessing fund ratings

On Tuesday the Swiss software company Information System for Analysts (ISFA), a subsidiary of the Swiss Financial Analysts Associaton (SFAA), presented the first Swiss software tool for assessing the quality of investment fund ratings. The software called ISFA Funds can be configured by the users according to individual needs. It features, for instance, the option of creating invidual benchmarks. This software allows to assess the quality of internal ratings as well as those of external rating agencies.

Source: Neue Zürcher Zeitung

press release: using Valordata Feed to create a EUSD Hub

Telekurs Financial and Web Services Integration (WSI) announce the launch of the Xceptor® EUSD Hub - the first end to end tax product to address the requirements and demands imposed on financial organisations by the European Union Directive on the Taxation of Savings Income (EUSD).

Read the full text of this press release (download 23 kb).

CBOE launches index on US exchanges

On 5 May the Chicago Board Options Exchange (CBOE) announced that it plans to launch options on the CBOE Exchange Index, "EXQ," a new benchmark index based on the stock prices of publicly traded U.S. exchanges, pending regulatory approval.The EXQ Index is currently composed of the prices of CBOT Holdings, Inc. (BOT), Chicago Mercantile Exchange Holdings, Inc. (CME), IntercontinentalExchange Inc. (ICE), International Securities Exchange, Inc. (ISE), Nasdaq Stock Market Inc. (NDAQ) and NYSE Group, Inc. (NYX) stock.

Source: CBOE - press release

Yahoo homepage to get make-over

Search site Yahoo is changing its main page to match the efforts of rivals to do more for visitors. Like Google and Microsoft, Yahoo is introducing clickable tools to let users customise what they see. The new homepage will be available as a beta, or test, version for the next month to assess how users repond to the alterations. In making the changes, Yahoo is the last of the big three search firms to re-focus its main web presence on what users want to do. The changes will be seen on the Yahoo homepages in the US, UK, France, Germany, Spain and Italy.

Read the full article by BBC News:

eBay ratings system for financial services

The UK financial services industry should introduce an eBay-type ratings system that each customer or counterparty could supply after every transaction, says the Securities & Investment Institute (SII).
In the Securities & Investment Review (S&IR) Simon Culhane, chief executive of of SII, says the financial services industry needs better ways for customers to provide feedback and praises the eBay customer ratings system.

Read the full story by

Blackberry entering China

Research in Motion (RIM) said on Thursday that after much delay it would introduce its BlackBerry wireless e-mail service in China. But the announcement of its joint venture with China Mobile, which came with few details, quickly prompted questions about how the Canadian company's product would fit into the Chinese government's program of communications surveillance and censorship.

Read the full story by The New York Times:

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Find out more about Telekurs Financial's mobile financial information offering Telekurs iD mobile

Bank of China is preparing IPO

The Bank of China (BOC) is China's second biggest commercial bank. BOC will go public at the Hong Kong stock exchange (HKEx) this June. The IPO of BOC is expected to be the largest in the history of all mainland China corporations.

Last October China's third biggest commercial bank, the China Construction Bank, reached a $ 9.2 bln out of its IPO at the Hong Kong exchange. According to press sources BOC is planning to reach $ 9.85 bln. A total of 25.6 bln shares will be issued which equals 10.5 % of the entire share capital. Shares are expected to be issued at a price between 2.5 and 3 HK$ per share which is around twice its book value.

According to the "Wall Street Journal" twelve institutional investors are said to be willing ot sign up for a respective amount of $ 180 m with the commitment to hold their shares for a period of one year after trading start.

According to Bloomberg BOC will also launch an IPO at the exchanges of mainland China in June 2007.

Source: Neue Zürcher Zeitung

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- Bank of China's IPO - shunning the homeland

Nasdaq holding in LSE nears 25%

The US stock market Nasdaq has raised its stake in the London Stock Exchange (LSE) to 24.1%, fuelling speculation about its intentions for the market.

Read the full story of BBC News:

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Nasdaq becomes major shareholder of the LSE

Virtual Reference Data Panel Discussion

In this months issue of the Investor Services Journal, Richard Newbury, Head of Product Services of Telekurs Financial, discusses the latest developments impacting the reference data landscape, effects of increasing regulation and key challenges and opportunities.

With new regulations impacting the financial market such as the EU Savings Directive, Basel II and MiFID, Richard Newbury was asked to give Telekurs Financial’s perspective on topical issues such as:

The latest developments impacting the reference data landscape
Regulation types that are impacting reference data and future regulatory developments
How Financial Institutions can ensure that their reference data is clean and consistent
Challenges presented to the reference data landscape due to investment funds becoming increasingly diverse
The effect on reference data by the market infrastructure and the implications of MiFID
The effect of further consolidation among stock exchanges and central securities depositories on the reference data landscape
Key challenges and opportunities facing reference data professionals

The conclusion was drawn that with evidence of regulations, improving EDM projects and the efforts to push standards up the chain to issuers, financial institutions will have a challenge to adjust. The response of the industry to existing and forthcoming regulation will determine how much more regulation will be seen in the European Union. The response from the industry to efforts such as the building of ISO15022 standards and the Giovannini reports will help inform regulators as to whether further regulation is needed. Apart from survival of MiFID being as a key test of firms’ ability to handle reference data – amongst many other issues - a number of new combined entities are likely to emerge from the existing firms as a result of the regulations's implementation.

UBS to take over Brazilian bank Banco Pactual

UBS is set to make a major move into South America by buying a Brazilian investment bank. UBS is to pay up to $2.5bn (£1.35bn) for Banco Pactual - making it a key player in the country's asset and wealth management sectors.

Read the full news story by BBC News:

Yahoo unveils new advert system

Yesterday, Internet giant Yahoo was due to launch an upgrade to its web search advertising system, as it aims to catch up with market leader Google.

Read the full article by BBC News:

SWX Group and Deutsche Boerse plan European exchange for securitised derivatives

The German stock exchange Deutsche Börse AG and the SWX Group intend to combine their warrant and certificate trading activities in a jointly operated securities exchange organisation. Both parties announced the plan last Friday. The collaborative undertaking will be conducted via a co-owned holding company domiciled in Zurich, which will be administered by the nationally regulated exchanges of Switzerland and Germany. The goal of the new joint venture is to create a European exchange for warrants and certificates. With this new exchange, Deutsche Börse AG and SWX will be expanding their existing cooperative efforts, which include the world’s largest futures and options exchange, Eurex, as well as the European provider of security market indices, STOXX.

The new company, to which both partners will contribute their existing business in securitised derivatives, will operate exchanges both in Switzerland and in Germany. To that purpose, SWX will spin off its business in warrants and certificates into a new Swiss-based exchange, which will commence operation on 1 January 2007. In parallel, the holding company will found an exchange in Germany under the mantle of the Bremen Stock Exchange, which SWX acquired in 2005. This new exchange is scheduled to open in the fourth quarter of 2007.

Source: SWX Group - media release

Euronext declines merger with Deutsche Boerse

In a letter to its shareholders Euronext has confirmed that it was not willing to merge with the German stock exchange Deutsche Boerse. Furthermore, Euronext advised its shareholders to vote against a proposal made by a hedge fund which describes a merger as being in their best interest. This proposal should be voted on the General Meeting of Shareholders to be held on 23 May. A merger between Deutsche Boerse and Euronext is strongly advocated by a number of hedge funds which have a stake in both exchanges.

Source: Neue Zürcher Zeitung

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ISIPS 2006

The ISIPS Exhibition will be held at The Brewery in London on 22 May 2006.

Now in its eighth year, ISIPS is the number one annual capital markets event held in Europe. Its content covers both wholesale and retail financial services technology and the event attracts more than 1000 senior practitioners from around the world.

The ISIPS program is designed to promote greater awareness of business process issues and demonstrates the range of industry solutions currently available and technology know-how to meet the changing regulatory demands and challenges of a highly competitive global securities industry. Seminar presentations cover the trading lifecycle from front to back office, across all asset classes, exploring issues facing banks, fund managers and broker dealers.

Telekurs Financial will be exhibiting (booth no. 27) and speaking at ISIPS this year specifically focusing on the topic ‘Managing your Risk exposure’, a presentation held by Dominique Tanner, Head of Business Development for Telekurs (U.K.) Ltd at 1.35 p.m.

To register for this event:

Contingency study confirms the progress made by the US financial sector

Federal regulatory agencies in the US say that clearing and settlement organisations and other firms that play significant roles in critical financial markets are now considerably more resilient to wide-scale disruptions than before September 11.

The findings are disclosed in a study prepared by The Federal Reserve, the Office of the Comptroller of the Currency and the US Securities and Exchange Commission private sector moves to implement more rigourus contingency planning.


To read the full report, download the joint report by the US federal regulartory agencies (pdf, 68.1 kb).

read also similar topics on this Weblog:
SFBC reports about Basel II status in Switzerland

Yahoo Introduces a Site on Consumer Technology

In one of its first major efforts to build a Web site with original material, Yahoo will introduce today a site devoted to consumer technology. The site, called Yahoo Tech (, will feature blogs on technology and a weekly video program. It will also republish articles and product reviews from several magazines and accept comments contributed by users.

Read the full article by The New York Times:





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