ICE’s portfolio margining for index and single name CDS is a welcome initiative, providing important margin efficiencies for participants,” said Spencer Woodward, Partner and Co Head of Operations, BlueBay Asset Management LLP. “As the regulatory landscape evolves to reduce systemic risk, ECM Asset Management is pleased to have reached an important milestone with regards to clearing European credit default swaps. There has been a large concentrated effort to ensure ECM keeps abreast of regulatory developments which will benefit our clients over the long-term, particularly, when clearing becomes a mandatory requirement in Europe,” said Andy Li, Portfolio Manager, ECM Asset Management. “Goldman Sachs is committed to working with our clients and ICE to provide access to a robust, scalable CDS clearing solution which will help market participants complete an important step towards implementing European regulatory reform requirements. We are pleased to be one of the first day participants and to be launching with Liontrust Investment Partners LLP, and look forward to continuing to partner with the industry,” said Stuart Connolly, Goldman Sachs International. “Credit Suisse welcomes the expansion of OTC clearing in Europe. The ICE Clear Europe clearing platform offers our clients additional choice for clearing OTC products, which is especially important given the impending introduction of mandatory clearing requirements, and we’re very pleased, therefore, to have cleared one of the first customer CDS trades through ICE Clear Europe,” said Alex Lenhart, European Head of Prime Services Listed Derivatives, OTC Clearing and FXPB Credit Suisse Securities (Europe) Limited. “Citi is very pleased to have partnered with Lombard Odier Investment Managers today in clearing some of the first client iTraxx positions at ICE Clear Europe. Citi is dedicated to offering the latest in OTC clearing solutions to our clients, and we look forward to continuing to work with ICE as mandatory clearing is rolled out in Europe,” said Silas Findley, Managing Director, Head of OTC Clearing for Europe, Middle East, and Africa at Citi. “J.P. Morgan is pleased to be one of the first clearing members to complete a client cleared trade on ICE Clear Europe’s CDS platform. This is a significant step forward for providing access to client clearing of credit default swaps in the European Market and a template as we build towards mandatory clearing under EMIR,” said Hester Serafini, global co-head of OTC Clearing at J.P. Morgan. In the U.S., ICE Clear Credit commenced client clearing in 2009 and has cleared U.S. $2.6 trillion in gross notional value for 301 clients to date. Globally, ICE has cleared 1.45 million CDS trades in the aggregate, totalling U.S. $44.8 trillion in gross notional value CDS instruments. Open interest stood at $1.5 trillion at September 27, 2013.
Orange CEO Says ‘No Money’ in Europe as Carriers Fight EU Rules
Credit: Reuters/Mike Blake BRUSSELS | Tue Oct 8, 2013 6:40pm EDT BRUSSELS (Reuters) – AT&T Inc Chief Executive Randall Stephenson on Tuesday said that he sees a “huge opportunity for somebody” in Europe to invest in mobile broadband and reap the big profits already being generated from such services in the United States. Stephenson, who has been exploring opportunities for AT&T to expand into Europe, said Europe has the potential to be “incredibly exciting” during his appearance at an industry conference held by ETNO, the European telecommunications lobby. However, the executive said that Europe needs to make big changes to its mobile spectrum policy in order to spur much needed investments in networks there. “I continue to be fascinated and impressed by how slow mobile broadband is moving in Europe. So I think of this as a huge opportunity for somebody,” said Stephenson. AT&T has been eyeing Europe since the beginning of the year, and has considered options including pan-European player Vodafone and Britain’s largest mobile carrier EE, a joint venture of Orange and Deutsche Telekom, according to sector bankers. But Stephenson told the audience of lobbyists, regulators and investors that Europe need to overhaul its regulatory policies on spectrum in order to realize its potential. For example he said, it would be easier for telecom operators in Europe to invest in their networks if they were able to buy long-term spectrum licenses and if spectrum policies were similar across the region’s different countries. “I know most of the CEOs here and they are pretty smart people who like to earn money for their shareholders. So if the investment case were there they would be doing more,” Stephenson said. “There will need to be a regulatory re-think.” Europe’s 28 member states still sell mobile licenses country by country and there is little standardization on the bands used, complicating the process of rolling out networks and preventing cross-border usage. Smartphones often need different chipsets to be able to work in different European markets, for example.
ICE Clear Europe Announces Successful Launch of European CDS Client Clearing; Five Clients Active on Day One
Her goal is to encourage data use, increase investment and make Europe more like a single market. Carriers say theyre being deprived of an important revenue source in a difficult market amid price wars and weak economies in several EU countries. Bringing down barriers is ultimately good for the sector, Kroes said in a keynote speech yesterday in Brussels at a conference hosted by the European Telecommunications Network Operators association. But you cant do that without removing roaming surcharges, without removing the arbitrary high charges for calling across borders. European telecommunications companies have invested 2 percent less annually on infrastructure in the last five years, meaning 3.5 billion euros ($4.7 billion) less was spent in 2012 than 2008, according to a survey by Boston Consulting Group commissioned by ETNO. Consolidation Freedom Carriers revenue is also expected to fall as much as 2 percent a year in the industry until 2020, for a cumulative decline of as much as 190 billion euros, according to the report. Carriers want more freedom to consolidate and less regulatory oversight over aspects of their networks, such as what technology they can run on their networks or how much they can charge other companies to use their infrastructure, executives said yesterday. They say they need the freedom to consolidate within markets to stabilize prices. There is very little in the proposals that concretely allow us to drive further consolidation, Philipp Humm , Vodafone Group Plcs head of Europe, said at the conference. Even so, the industrys frustration with regulators may be driving an increase in share valuations as mergers and acquisitions pick up for the industry across Europe, said Robin Bienenstock , an analyst with Sanford C. Bernstein. In Spite The regulation event has proven to be so inordinately time-wasting and frustrating and dead-end that youre starting to see companies act, Bienenstock said at the event. The regulations are so lousy that people are starting to act in spite of it. Oranges Richard said that while he previously wouldnt pursue deals because he was convinced regulators would reject them, hes decided the best strategy is to test the market with deals to find out what regulators will tolerate. We cannot compete in our environment anymore, said Timotheus Hoettges, deputy CEO of Deutsche Telekom. Europe is at a scale too small to be relevant. Hoettges said that the major European carriers would all have to combine to have a market capitalization comparable to AT&T Inc., the biggest U.S. phone company.