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Read more about IG Markets News and its updates The World Federation of Exchanges (WFE), the global industry group for exchanges and   central   counterparties   (CCPs),   has   published   a   joint   report   with   global management consultancy Oliver Wyman in which it concludes there is a need for $3 to $4 billion in spending to address market integrity. The report, which focuses on the pivotal role of exchanges and CCPs in supporting market   integrity,   looks   how   exchanges   and CCPs   have   evolved   since   the   2008   global financial crisis in response to regulatory reform to   promote   safe   and   efficient   markets. Additionally, it establishes trends in financial markets and their implications for MIs with   respect   to   preserving   market   integrity,   and   a   vision   for   the   future   role   and capabilities of MIs. Market integrity ensures that participants enjoy equal access to markets, that price discovery   and   trading   practices   are   fair,   and   that   high   standards   of   corporate governance are met. Market infrastructures exercise rulemaking, member admission, market surveillance, market data and regulatory reporting, and investor education. Post­crisis G20 reforms in the last decade have changed the supervisory role of Mis with a move towards more transparent exchange or exchange­like marketplaces, as well   as   a   shift   towards   CCP   clearing   for   OTC derivatives, along with developments regarding central reporting of trades and tighter capital, liquidity and risk management standards.

Nandini Sukumar, Chief Executive Officer of The WFE

As over 60% of survey respondents believe that market supervision is a core focus area, 70% of participants confirmed that supervision requirements have increased and will continue to do so over the next decade. Nandini Sukumar, Chief Executive Officer of The WFE commented: “MIs serve a dual role: firstly, to foster economic growth, and secondly, to preserve market integrity. Today’s joint WFE­Oliver Wyman report reveals the true extent of that second purpose and showcases the evolution that MIs have undergone in the past decade to ensure the continuation of fair and orderly markets.Indeed, as regulation, technology and financial services continue to dynamically impact the markets around


them, the role of MIs in preserving market integrity has never been as important as it is today. We look forward to working with our members and stakeholders to continue to take on a more significant role adding value, and safety, to the industry.” As   market   infrastructures   face   increased   regulatory   demands,   enhancements   to corporate governance and disclosure to preserve market integrity, the report concludes that the financial markets industry will need to spend up to $3­4 billion over the next five   years   to   realize   the   agenda,   with   roughly   40%   of   this   investment   being undertaken by MIs The   agenda   includes   higher   standards   of   market   integrity,   surveillance   and supervision, broad industry cooperation and collaboration across MIs and the wider Gain Capital News, markets industry, real­time surveillance, and outcome­oriented supervision. Daniela Peterhoff, Global Head of Market Infrastructure at Oliver Wyman, said: “The   changes   we   have   outlined   are   significant   and   will require a robust, proactive approach. Incumbents will need to   move   quickly,   or   else   risk   losing   share   to   innovative competitors. We see MIs pursuing bold investments in new Daniela Peterhoff, Global Head of Market Infrastructure at Oliver Wyman

technologies (such as AI and pattern recognition). We also expect   MIs   to   take   a   lead   in   creating   opportunities   to collaborate between MIs, regulators and IG markets news participants.   The   current   focus   on   the   digitization   of   risk management   and   compliance   frameworks   and   tools   will

remain for   a   while.   Finally,   we   will   see   continuous   enhancement   of   supervisory functions using data analytics.”

Learn more about IG Markets News with exclusive Updates  

Latest news and analysis on the IG Markets News from our team of experts. Get the latest News! Read our articles and news which are updated...

Learn more about IG Markets News with exclusive Updates  

Latest news and analysis on the IG Markets News from our team of experts. Get the latest News! Read our articles and news which are updated...

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