Monthly Archives: February 2016

Regulators using social media connections also for insider trading case

This order of SEBI is otherwise just another case where parties were found to have allegedly profited from insider trading. The only noteworthy point is that the connection between two of the parties was detected because they had common friends on social media. To my recollection, this is perhaps the first case where SEBI investigated the social media profile of the parties. The Hon’ble Wholetime Member observed :

“Mr. Pirani Amyn Abdul Aziz is also found to be connected to Mr. Ameen Khwaja through mutual friends on ‘Facebook’. “

Needless to add, SEBI also found the transactions of the party otherwise suspicious too. Social media connections are often used to do background checks. On their own, they can rarely be reliable indicators of connections.

Is Oil’s Spill Turning the Credit Cycle?

While the slumping price of oil is bearing the brunt of the current volatility in the markets these days, there are other signs that indicate more widespread shifts in the credit cycle.  High-yield credit default spreads have widened, as shown by both the S&P/ISDA CDS U.S. High Yield BB and the S&P/ISDA CDS U.S. High Yield B and Below.  The indices are up 183 and 197 bps, respectively, over the past year (see Exhibit 1).  The turmoil in the energy sector has had an impact; however, the widening also represents the overall discomfort with the amount of leverage companies have on their balance sheets within the broader high-yield market.

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India Ratings Webinar on FY17 Sector Outlook on Auto and Automotive Suppliers, 4PM IST 26 FEB

India Ratings and Research invites you to a webinar on FY17 Sector Outlook on Auto and Automotive Suppliers.
Register now

You can now post your questions to the analysts in advance. Request you to kindly send in your questions at investor.services@indiaratings.co.in

Registration is mandatory to attend the webinar. Request you to kindly use your work email address to register.

There are limited seats available to attend the webinar and the same will be served on first come first serve basis.

Webinar : A reality check: blockchain in financial services, 25th Feb 2016, 1030pm IST

A reality check: blockchain in financial services

These days, no meaningful conversation on financial services innovation can be had without a mention of blockchain. It is believed by many to have the potential to address many limitations of current financial services processes and infrastructure by providing an irrevocable record of identity and provenance, and reconciling events so that there is a single version of truth. But with potential and interest also comes hype and confusion.

In this webinar, industry experts will cut through the hype and separate myth from reality. They will explore characteristics of blockchain technology that make it suitable for financial services applications, and what current industry issues can really be solved by distributed ledger technology.

Webinar at 25th Feb 2016, 1030pm IST

India Ratings Webinar on FY17 Sector Outlook on Banks and NBFCs, 4PM IST 23 Feb

India Ratings and Research invites you to a webinar on FY17 Sector Outlook on Banks and NBFCs.

You can now post your questions to the analysts in advance. Request you to kindly send in your questions at investor.services@indiaratings.co.in

Registration is mandatory to attend the webinar. Request you to kindly use your work email address to register.

There are limited seats available to attend the webinar and the same will be served on first come first serve basis.

Moody’s Teleconference Series: Global Macro Outlook 2016-17 – Global Growth Faces Rising Risks at Time of Policy Constraint 22 & 23 February 2016

Moody’s Teleconference Series:
Global Macro Outlook 2016-17 – Global Growth Faces Rising Risks at Time of Policy Constraint
22 & 23 February 2016
Downside risks to global growth have increased since our last Global Macro Outlook as a further fall in oil prices and concerns about weaker growth in China and potential further currency weakness have accompanied a rise in risk aversion and tightening of financial market conditions. If prolonged, the higher funding costs and constrained market access for many high-yield corporates could have a larger impact on investment and economic growth than currently incorporated in our forecasts.


The following topics will be discussed:
» What role will policy support play in China’s gradual slowdown?
» What economic outlook for policy-constrained Brazil, Russia and South Africa?
» What are the factors behind a lackluster growth outlook in the US, Europe and Japan?
» What are the main downside risks to the global economy?

EMEA/AMERICAS: 22 February 2016 – 09:00 EST / 14:00 GMT / 15:00 CET
This session, also available via webcast, will be led by:

» Bart Oosterveld, Managing Director, Public Sector Credit Strategy and Standards (moderator)
» Marie Diron, Senior Vice President, Sovereign Risk Group

APAC: 23 February 2016 – 11:00 HKT / 12:00 JST / 14:00 AEDT
This session, also available via webcast, will be led by:

» Michael Taylor, Managing Director, CCO, APAC (moderator)
» Marie Diron, Senior Vice President, Sovereign Risk Group

These calls will each last approximately 45 minutes.

Registration for both calls is required. Please click on your preferred session to receive joining instructions.

India Ratings Webinar on FY17 Sector Outlook on Power and Oil & Gas, 4PM IST 22 Feb

FY17 Sector Credit Outlook Webinar Series

India Ratings and Research invites you to the FY17 sector credit outlook webinar series, starting 19 Feb 2016.

Register now

The webinar is hosted by lead analysts tracking their respective sectors. This webinar schedule is below.

There’s a seat limit for each webinar, and they’re sure to be snatched up quickly, so register today!

India Ratings Webinar on FY17 Sector Outlook on Structured Finance. 4pm IST 19 Feb

FY17 Sector Credit Outlook Webinar Series

India Ratings and Research invites you to the FY17 sector credit outlook webinar series, starting 19 Feb 2016.

Register  now

The webinar is hosted by lead analysts tracking their respective sectors. This webinar schedule is below.

There’s a seat limit for each webinar, and they’re sure to be snatched up quickly, so register today!

S&P Revises Its Price Assumptions For Metals On Continuing Price Weakness

Standard & Poor’s Revises Its Price Assumptions For Metals On Continuing Price Weakness

We have updated our price assumptions for metals for 2016-2018 to reflect the current market conditions and outlook for each commodity. Commodity prices have collapsed for the third year in a row, falling by 10%-45% over the past 12 months. In particular, iron ore and nickel prices have fallen well below our previous assumptions. Metal prices have come under pressure because of fears of lower demand from China, combined with excess supply, although the degree of the excess varies by metal. Currently, China is responsible for about 40%-50% of global commodity consumption. Our price deck assumes that steel production in China will not recover in 2016, after it contracted by about 2% in 2015. We expect this assumption to have a knock-on effect on demand for all related commodities, including iron ore, coking coal, zinc, manganese, nickel, and other metals.

Prospects for the Global Economy in 2016

The world will face economic challenges on multiple fronts in 2016. As the U.S. Federal Reserve begins its monetary tightening, Europe is struggling to manage migrant and debt crises, China’s financial stability is in doubt, and emerging economies are increasingly fragile.

The global economy “could be doing much worse,” writes CFR Senior Fellow and Harvard economist Kenneth Rogoff. Low oil prices and weak currencies are keeping the European and Japanese economies afloat, but Rogoff warns of “a slowing Chinese economy, collapsing commodity prices, and the beginning of the U.S. Federal Reserve’s rate-hiking cycle.”

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S&P : What Are Rating Criteria?

What Are Rating Criteria?

We use the term “criteria” generically to refer to the whole body of written guidance for our assignment of credit ratings. Such guidance includes a discussion of quantitative and qualitative elements, analytical methodologies, and assumptions that we use in the ratings process to produce our rating opinions. Our criteria may be global, regional, or local in scope, or apply to one or more industries, asset classes, or other subject areas. We refer to this body of guidance as “criteria.” Our rating committees assign ratings based on the application of criteria to the circumstances of an individual issuer or issue. Criteria provide general guidelines and tools to analyze risks that are common to a sector, region, asset class, or other subject area. We publish criteria on our public website to be transparent to the marketplace. In this article, we explain the different types of criteria, how we label them, and our criteria proces

Moody’s Teleconference – Japan Credit Series: Support Assumptions for Japanese Megabank Holding Company Debt, Tuesday, 16 February 2016, 9:00am Hong Kong / 10:00am Tokyo / 12:00pm Sydney / 5:00pm US West Coast

Moody’s Teleconference
Japan Credit Series:
Support Assumptions for Japanese Megabank Holding Company Debt
Register Now Button
Events Details
Tuesday, February 16, 2016
9:00am Hong Kong
10:00am Tokyo
12:00pm Sydney
5:00pm US West Coast
Moody’s Investors Service will hold a teleconference on Tuesday, 16 February 2016 to discuss support assumptions for Japanese megabank holding company debt.

This discussion will be led by:
» Graeme Knowd, Managing Director – Banking, Financial Institutions Group (Moderator)
» Shunsaku Sato, Vice President-Senior Credit Officer, Financial Institutions Group
» Tetsuya Yamamoto, Vice President-Senior Analyst, Financial Institutions Group

The following topics will be discussed:
» Level of government support incorporated into holding company debt
» Government’s willingness and ability to provide pre-emptive support to megabanks
» Support assumptions for holding company debt will change if government moves towards supporting particular debt class

The related reports may be viewed at the following links:
FAQ: Support Assumptions for Senior Unsecured Debt Instruments Issued by Japanese Megabanks (Feb 10, 2016)                         
Announcement: Moody’s incorporates “Very High” support assumptions for all debt classes issued by Japan’s megabanks (Feb 10, 2016)

This call will last approximately 60 minutes and registration is required.
Register Now Button

Moody’s Teleconference: Australian 2016 Credit Outlook (APAC), 17 February 2016

Moody’s Teleconference : Australian 2016 Credit Outlook – Impact of External Risks and Domestic Rebalancing on Australian Credit

Wednesday, 17 February 2016,  11:00 Hong Kong / 12:00 Tokyo / 14:00 Sydney

Discussion Items

·         Australia’s economic and sovereign outlook within a global context

·         Recent market volatility and credit implications

·         China, commodities, currency and confidence

·         Real estate, interest rates and regulation

Speakers
Atsi Sheth, Associate Managing Director, Sovereign Risk Group

Patrick Winsbury, Associate Managing Director, Corporate Finance and Financial Institutions Groups
Jennifer Wu, Associate Managing Director, Structured Finance Group

Arnon Musiker, Vice President – Senior Credit Officer, Infrastructure Finance Group
Debra Roane, Vice President – Senior Credit Officer, Sub-Sovereign Group

The entire session — with prepared remarks and the Q&A — will last about one hour

If you wish to participate, please RSVP early. Dial-in numbers will be provided.

 REGISTER HERE

 Registration Is Required

Replay information will be provided to registrants after the teleconference.

Submit Questions in Advance

Participants are encouraged to submit questions in advance of the teleconference by clickinghere.

FSB publishes fourth EDTF report on bank risk disclosures

The Financial Stability Board (FSB) today published two reports and a statement from the Enhanced Disclosure Task Force (EDTF). The 2015 Progress Report on Implementation of the EDTF Principles and Recommendations is the EDTF’s fourth report and third progress report on implementation of the EDTF recommendations; it covers 40 global or domestic systemically important banks. The FSB also published an EDTF report on the Impact of Expected Credit Loss Approaches on Bank Risk Disclosures which highlights issues with the implementation of new accounting standards on expected credit loss (ECL). Furthermore, the EDTF provided a statement on the treatment of emergency liquidity provision under the EDTF disclosure recommendations.

 

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Mckinsey : A best-practice model for bank compliance

Compliance risk has become one of the most significant ongoing concerns for financial-institution executives. Since 2009, regulatory fees have dramatically increased relative to banks’ earnings and credit losses (Exhibit 1). Additionally, the scope of regulatory focus continues to expand. Mortgage servicing was a learning opportunity for the US regulators that, following the crisis, resulted in increasingly tight scrutiny across many other areas (for example, mortgage fulfillment, deposits, and cards). New topics continue to emerge, such as conduct risk, next-generation Bank Secrecy Act and Anti-Money Laundering (BSA/AML) risk, risk culture, and third- and fourth-party (that is, subcontractors) risk, among others. Read full Article

Rising Interest Rates May Not Have an Immediate Impact on Senior Loan Rates

Following months of uncertainty, the U.S. Federal Reserve has indicated that there could soon be a hike in the Federal Funds Target Rate.  Interest rates have been kept in a range between zero and one-quarter of a percent since December 2008 and have not risen since June 2006.

As interest rates have been at historically low levels for nearly the last seven years, some fixed income investors have shifted their focus to senior loan securities with floating-rate characteristics, such as interest rate floors, to protect themselves in the event of falling rates.  Interest rate floors protect the loan interest rate by increasing the loan interest rate to the spread plus the floor if the reference rate ever falls below the floor.  Simply put, the formula for loan rates in these structures can be stated as follows.

Loan Interest Rate = Maximum of (Reference Rate or Floor) + Spread

Read more at: http://www.indexologyblog.com/2015/12/02/rising-interest-rates-may-not-have-an-immediate-impact-on-senior-loan-rates/

Industry recognizes the need for Credit Specialization – Genpact endorses Certified Credit Research Analyst program

Genpact partners with AIWMI to build talent for Credit Risk Analytics

Genpact, the architect of the Lean Digital enterprise, announced that it has strengthened its Risk Academy, a comprehensive learning and development program, by including Certified Credit Research Analyst (CCRA) certification offered by Association of International Wealth Management of India (AIWMI) as part of an extensive training curriculum.

http://www.aiwmindia.com/ccra

http://www.indiainfoline.com/article/news-sector-information-technology/genpact-partners-with-aiwmi-to-build-talent-for-credit-risk-analytics-116020800182_1.html

On Demand Webinar : A Primer on Solvency II for Insurers Around the Globe

Solvency II is a transformative regulation for the European insurance industry, as it harmonizes the regulatory regime across all 28 member states of the EU and forces insurers to better manage the risks they face while also better protecting policyholders and shareholders. Adopted in 2009 and coming into effect on January 1, 2016, it has been a long, tough journey for many European insurers as they have worked hard to comply with the new regulations.

Register now

However, insurers all around the globe will also be watching carefully as Solvency II takes effect, to see whether the regulations meet their intended objectives and to learn from both the successes and failures. But it is a complex regulatory framework – and to benefit from the lessons learned in Europe, practitioners first need to understand the core principles and important details of the directive.

On Wednesday, October 14th featured speaker Luca Trussoni Senior Financial Engineer at Numerix, presented an introduction to Solvency II to help insurance practitioners around the world better understand the “big picture” of the directive.

Mr. Trussoni Addressed:

  • Why Solvency?
  • Solvency I and Solvency II
  • The Three Pillars of Solvency II
  • Key Aspects of the Three Pillars
  • Takeaways

Featured Speakers:

Luca Trussoni, FRM, Senior Financial Engineer, Numerix
Luca Trussoni is a senior member of the Financial Engineering team in Europe, and he works with clients to help solve their derivative pricing and risk management challenges. Before joining Numerix, Mr. Trussoni was a risk manager in bank and insurance groups in Italy (like Sanpaolo IMI, Fondiaria SAI and Banca Mediolanum), mainly working of quantitative aspect of risk management both in Basel and Solvency II contexts. He holds an MSc in Mathematics from University of Turin, an MA in Banking and Finance from CUOA Business School, and an FRM certification from GARP.

Moderator: Jim Jockle, Chief Marketing Officer
Mr. Jockle leads the company’s global marketing efforts, spanning a diverse set of solutions and audiences. He oversees integrated marketing communications to customers in the largest global financial markets and to the Numerix partner network through the company’s branding, electronic marketing, research, events, public relations, advertising and relationship marketing.

Prior to joining Numerix, he served as Managing Director of Global Marketing and Communications for Fitch Ratings. During his tenure at Fitch, Mr. Jockle built the firm’s public relations program, oversaw investor relations and led marketing and communications plans for several acquisitions. He also oversaw the brand development of a new company dedicated to the enhancement of credit derivative and structured-credit ratings, products and services. Prior to Fitch, Mr. Jockle was a member of the communications team at Moody’s Investors Service.

– See more at: http://www.numerix.com/on-demand-webinar/primer-on-solvency-ii-insurers-around-globe

WHAT COP21 MEANS FOR INVESTORS’ TO-DO LISTS

The ambitions and provisions of the Paris Agreement are clear, as is its future impact on returns. Investors responding to growing and changing risks can contribute to stabilising both the climate and capital markets in the coming decades. And as Jane Ambachtsheer writes, the ball is now in the court of the world’s fiduciaries – strong governance is a prerequisite for the effective management of climate risk.

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