Regulation
Watchdog savages NAB
MELBOURNE -- National Australia Bank’s currency options desk will remain closed until it has satisfied requirements issued by its regulator in a damning report released last week.
Seven leave Dresdner in FX flight
LONDON -- Dresdner Kleinwort Wasserstein in London is facing an exodus of staff from foreign exchange, with at least seven leaving the bank in London and New York in the past month.
Asian regulators ease restrictions
HONG KONG -- Banks in Northeast Asia are rushing to apply for licences to enable them to transact non-renminbi derivatives in China, following a relaxation of the rules from March 1.
Correlation for hedging and speculation
One of the most surprising FX developments in the past year has been the re-emergence of the use of correlation products. Ade Odunsi, a director in Merrill Lynch’s FX risk advisory group in New York, suggests two such solutions for a hedging and a…
IASB set to launch Euro advisory group
LONDON -- IASB, the International Standards Board, has invited senior officials to form a European consultative group to advise on issues related to the application of accounting standards.
Politics overshadows economics for zloty
WARSAW -- The resignation of the Polish prime minister from the leadership of the ruling Democratic Left Alliance (SLD) Party will lead to continued volatility in the zloty, which is already close to record lows, analysts said last week.
NAB report to reveal ‘control breakdowns’
MELBOURNE -- Pricewaterhouse- Coopers’ (PWC) report on the forex options trading scandal that has shaken National Australia Bank (NAB) in recent weeks is expected to expose a number of risk control problems at the bank, Graham Kraehe, NAB’s new chairman,…
FXCM hits back at CFTC charge
NEW YORK -- Online trading firm Forex Capital Markets (FXCM) hit back at the Commodity Futures Trading Commission (CFTC) last week, after the regulator charged it with liability for an allegedly fraudulent trading firm.
Reflationary effects on dollar/yen
Strong cross-border portfolio inflows into Japan are unlikely to falter. Consider either Seagull or reverse knock-in option strategies to protect against further yen strength, say State Street Global Markets’ currency options and currency strategy teams
New accounting rules put focus on training
LONDON -- New accounting regulations and recent instances of suspected fraud in the forex markets should make training financial markets staff a top priority, said officials at online training firm Intuition in London.
IASB to create advisory group
LONDON -- IASB, the International Accounting Standards Board, is investigating the establishment of an advisory forum, following comments from euro official Frits Bolkestein last month that standards for the treatment of derivatives are still unsuitable…
ACI reaffirms manager liability for fraud
LONDON -- Ultimate responsibility for misdemeanours on the trading floor rests with senior management, forex industry body ACI reminded market participants last week, in a letter prompted by recent reports of "alleged fraud or malpractice" in the…
Firms race for North American retail investors
NEW YORK -- Trading firms and exchanges are building FX products targeting the retail market, as retail investor interest in foreign exchange soars in North America.
NAB ‘rogue trading’ dates from 2002
MELBOURNE -- Alleged rogue trading in forex options at National Australia Bank (NAB) had been going on for at least a year before the bank’s original estimate, an NAB official said last week, as the bank revised its final estimate for losses up to A$360…
Spotlight on ‘points’ post FBI inquiry
NEW YORK -- The New York FX Committee is likely to revise its guidelines on FX trading and operational risk management this year, when it concludes a review into issues arising from the FBI’s arrests of 47 currency traders last November.
NAB chief admits weaknesses
MELBOURNE -- National Australia Bank chief executive Frank Cicutto last week admitted that weak internal processes had enabled the four traders it suspended on January 13 to carry out a suspected fraud.
IAS 39 still unacceptable says Euro official
BRUSSELS -- Frits Bolkestein, European commissioner for the internal market, taxation and customs union, said last week that standards for the treatment of derivatives are still not suitable for adoption, despite recent concessions by the International…
Clearview charged by CFTC
NEW YORK -- The Commodity Futures Trading Commission (CFTC) has charged Clearview Capital Management and its head trader James Weiss for misrepresentation, and is seeking an injunction to suspend the firm.
‘Illegal trading’ costs NAB $140m
MELBOURNE -- Australia’s largest bank, National Australia Bank (NAB), became the latest victim of alleged rogue forex trading last week. The bank said on Tuesday (January 13) that it had uncovered losses of up to A$180 million (US$140 million) from…
EBS outage sparks BoJ rumours
LONDON -- Dealers acting on behalf of the Bank of Japan (BoJ) may have been among the customers frustrated by momentary lapses in spot broking platform EBS’s dealable rates last week.
September - Quote unquote
"We jointly decided that the best move would be to increase its FX expertise" -- Jim Brown , managing director of TH Lee Global Internet Managers, on the departure of Currenex chief executive Lori Mirek in January
October - BoA announces Fleet bid
Banking mergers were thin on the ground in 2003, but in October, news came of Bank of America’s (BoA) $47 billion purchase of FleetBoston Financial.
February - Heavyweights tackle anonymity risks
The risk of trading with unnamed counterparties was highlighted in February, when central banks and top players in FX joined together to combat the problem.
May - Banks’ operational risk lapse exposed
A special investigation by FX Week in May revealed a lapse in operational risk management at banks that do not separate risk management budgets from business lines.