Mastering MiFID II: Implications for Execution in Investment Banking

Assessing the Cost of Compliance

This report is the first in a series of GreySpark Partners reports examining buyside and sellside business and operation imperatives associated with compliance with the second iteration of the EU’s Markets in Financial Instrument’s Directive (MiFID II).

Published on: 8 Jul, 2016somdn_product_page

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Description

The first report in this series explores the costs that investment bank trade execution franchises will incur as a result of compliance with MiFID II.

The report explores the most challenging aspects for a bank in achieving compliance with MiFID II’s trade and transaction reporting mandates, specifically:

  • the impact of the directive’s best execution mandates on the costs associated with trading;
  • the creation of a new type of trading venue called an organised trading facility and the impact it will have on existing sellside systematic internaliser registrations;
  • the impact of new mandates governing algorithmic trading;
  • the impact of new rules designed to monitor the provision of direct market access services by banks; and
  • the challenges posed by a currently inconsistent proposed regime for banks to synchronise the clocks that their trading systems use with the clocks used by trading venues for trade time-stamping purposes.

The report develops a series of best practices recommendations that banks can follow when attempting to comply with these MiFID II mandates that directly impact the profitability that can be derived from a sellside execution franchise.

Mastering MiFID II: Implications for Execution in Investment Banking – Table of Contents

  • 1.0 The Implications of MiFID II Trade and Transaction Reporting Rules for Execution Franchises
  • 2.0 The Implications of MiFID II’s Best Execution Mandates
    • 2.1 Assessing the Cost of Compliance
  • 3.0 The Implications of MiFID II Organised Trading Facilities
    • 3.1 Assessing the Cost of Compliance for the Sellside Equities and Equities-like Instruments Execution Franchise
    • 3.2 For the Sellside Derivatives Execution Franchise
    • 3.3 For the Sellside Bonds Execution Franchise
  • 4.0 The Implications of MiFID II’s Algorithmic Trading Rules
    • 4.1 Assessing the Cost of Compliance
  • 5.0 The Implications of MiFID II’s Direct Market Access Rules
    • 5.1 Assessing the Cost of Compliance
  • 6.0 The Implications of MiFID II’s Clock Synchronisation Rules
    • 6.1 Assessing the Cost of Compliance
  • 7.0 Appendices
    • 7.1 Glossary of Terms
    • 7.2 Table of Figures

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