The International Capital Markets Association (ICMA) and Association for Financial Markets in Europe (AFME) have issued their full support for the FCA’s new transparency regime for bonds and derivatives.
This is a “vital first step” towards a successful consolidated tape, AFME said, stating that the new requirements will protect investors and liquidity providers while providing timely transparency.
ICMA agreed, noting that “this is an important step in bolstering the UK’s infrastructure for the trading of domestic and international bond markets and in ensuring that London remains a leading centre for global capital markets.”
The new regime, which comes into force 1 December 2025, is the result of industry concerns that existing practices are expensive, have limited price formation impact and do not deliver meaningful transparency. Following a consultation process, ending 6 March 2024, the FCA has amended its initial proposed changes.
READ MORE: FCA publishes new transparency requirements
ICMA stated that it “appreciates the high degree of industry engagement which has helped to refine some of the regime’s more technical features”, commending the FCA for its data-driven approach to the regime’s structure and recognition of the need for operational simplicity.
Victoria Webster, managing director of fixed income at AFME, agreed: “We have long acknowledged that establishing the correct balances between simplicity versus nuance, and sufficient transparency versus adequate protection for market makers, is crucial for a successful transparency regime.”
Concluding its statement, ICMA affirmed that it “looks forward to providing a more detailed assessment of the FCA’s proposals and – looking ahead – supporting a smooth implementation of the new transparency framework and the successful launch of a bond consolidated tape.”
©Markets Media Europe 2024
