Latest Commentary

Vendor risk management may be built into future contracts

For several years now, financial firms have been under increasing regulatory pressure to monitor and manage the risks posed by their vendors, and even their vendors' vendors. As financial firms hone their vendor and third-party risk management skills, their metrics for measuring the riskiness of their vendors may one day become a standard part of the vendor contracts, much like service level agreements, one vendor says.

Vanguard latest on board as robo-advisers continue to gain steam

Vanguard is seeing strong adoption of a pilot program that offers automated financial advice, with assets more than quintupling in the first three quarters of the year. The automated platforms, known as robo-advisers, have seen strong growth this year, with financial companies like Fidelity and Charles Schwab announcing similar services and independent robo-advisor companies achieving solid expansion.

Growth, fragmentation and scandal in FX spur new data demands

The FX market now sees more than $5 trillion in turnover a day, but the rate of growth in this complex and fragmented market may have been surpassed by its rate of change. Last year's Triennial Central Bank Survey of foreign exchange and derivatives markets activity conducted by the Bank for International Settlements, found that two-thirds of the trading growth in the market since the last survey in 2010 came from non-dealer financial institutions, pointing to a growing role of smaller banks, institutional investors and hedge funds in a market that once had a more clear-cut dealer-to-dealer and dealer-to-client structure.

Challenging the logic of frequent batch auctions

As CEO of a trading venue that has long used electronic auctions as its signature trading method, PDQ chief executive Keith Ross might seem like an unlikely person to challenge a proposal to replace central limit order book trading with frequent batch auctions. But for Ross, not all electronic auctions are created equal.

 

Financial firms wrestle with fourth-party risk

In manufacturing, companies are traditionally worried about every component of their supply chain, assessing each component's performance level and susceptibility to failure. As spectacular cyber breaches and technical glitches make headlines, financial firms that have outsourced portions of their infrastructures as cost-saving measures are now looking at their supply chains with that same critical eye.

Firms boost legal reserves as FX investigations heat up

The Commodity Futures Trading Commission is expected to announce fines in the alleged rigging of the $5.3 trillion-a-day currency markets any day now, according to published reports. The CFTC may levy fines of around $300 million against each firm it is investigating, according to anonymous sources cited by Bloomberg.

 

Mobile payments take sides in burger wars

PayPal added sizzle to the mobile payments battles this week, announcing it has partnered with Burger King for mobile payments, just months after Apple Pay announced that it has a partnership with McDonald's.

 

Financial services execs increasingly look past Bitcoin to the potential of the blockchain

While Bitcoin has attracted an oversized amount of attention, both positive and negative, several executives at financial services firms are increasingly looking past Bitcoin to the blockchain technology that underpins it--and they see strong potential for financial services.

Wall Street says audits, crisis response plan needed to combat cybercrime

In the wake of this summer's cyberattack on JPMorgan, a Wall Street trade group representing hundreds of securities firms, banks and asset managers is speaking up on how the securities industry's cybersecurity should be managed. Detailed audits that are customized to individual firms' business models and an industry crisis response plan will be required to safeguard the industry, the Securities Industry Financial Markets Association said in an 11-page paper released last week.

JPMorgan will double cybersecurity spending but many other companies may cut costs

On the heels of news that the cyberbreach at JPMorgan Chase & Co may have affected as many as 76 million customers, chairman and CEO Jamie Dimon announced last week that the firm will double its $250 million annual computer security budget over the next five years.