Citi's London Office Visited By Fed, Treasury Investigators

Either the Fed and the OCC are unaware of this thing called “computers” which allows them to find out what a bank’s trading desk somewhere, anywhere in the world has done at any point in the past 30 or so years, or they really felt the need to stretch their legs around London’s Canary Wharf, or they heard very good news about Citi’s seafood buffet at its London HQ, but whatever the reason Reuters reports that “the U.S. Federal Reserve and Office of the Comptroller of the Currency have sent investigators to Citigroup’s London headquarters as part of an international investigation into alleged manipulation of the global currency market, a source familiar with the matter told Reuters on Wednesday.”

More from the source:

[The visit] comes after Citi last week fired its head of European spot foreign exchange trading Rohan Ramchandani, following a prolonged period on leave.

 

The Fed and OCC officials, who have been at Citi’s Canary Wharf office in London this week, are at the preliminary stage of information-gathering and their presence is “independent” of Ramchandani’s sacking, the source said. The Federal Reserve and OCC, which is an independent bureau of the U.S. Treasury, both declined to comment. A spokesman for Citigroup also declined to comment.

 

Last year, Britain’s Financial Conduct Authority began a formal investigation into possible manipulation in the $5.3 trillion-a-day global FX market. The U.S. Justice Department is also engaged in an active investigation of possible manipulation of the market, the world’s largest.

We eagerly look forward to the Fed’s Yelp review of the various food options at Citi’s Canary Wharf office.


    



via Zero Hedge http://ift.tt/19usJoA Tyler Durden

Citi’s London Office Visited By Fed, Treasury Investigators

Either the Fed and the OCC are unaware of this thing called “computers” which allows them to find out what a bank’s trading desk somewhere, anywhere in the world has done at any point in the past 30 or so years, or they really felt the need to stretch their legs around London’s Canary Wharf, or they heard very good news about Citi’s seafood buffet at its London HQ, but whatever the reason Reuters reports that “the U.S. Federal Reserve and Office of the Comptroller of the Currency have sent investigators to Citigroup’s London headquarters as part of an international investigation into alleged manipulation of the global currency market, a source familiar with the matter told Reuters on Wednesday.”

More from the source:

[The visit] comes after Citi last week fired its head of European spot foreign exchange trading Rohan Ramchandani, following a prolonged period on leave.

 

The Fed and OCC officials, who have been at Citi’s Canary Wharf office in London this week, are at the preliminary stage of information-gathering and their presence is “independent” of Ramchandani’s sacking, the source said. The Federal Reserve and OCC, which is an independent bureau of the U.S. Treasury, both declined to comment. A spokesman for Citigroup also declined to comment.

 

Last year, Britain’s Financial Conduct Authority began a formal investigation into possible manipulation in the $5.3 trillion-a-day global FX market. The U.S. Justice Department is also engaged in an active investigation of possible manipulation of the market, the world’s largest.

We eagerly look forward to the Fed’s Yelp review of the various food options at Citi’s Canary Wharf office.


    



via Zero Hedge http://ift.tt/19usJoA Tyler Durden

Russell Joins Trannies And NASDAQ In The Green For 2014

For now unsupported by the usual VIX slam or JPY smash, US equities are spiking higher. The Dow and The S&P 500 remain in the red for the year still but Russell has now surged to new highs and joined Trannies and NASDAQ in the green for 2014.

 

 

But AUDJPY not supporting it for now…

 

Or VIX…


    



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Will we walk by faith or by sight in 2014?

We’re two weeks into 2014, but it’s still early enough to decide to put our best foot forward this year. What are you doing that will help you make great spiritual progress in your life?

I loved the story in a recent Sunday paper about Margie Bowen, the retired physical education teacher who, on New Year’s Eve, made her 500th climb up Stone Mountain.

read more

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Thomas-Bickett Engagement

Michael and Leigh Thomas of Peachtree City, Ga. proudly announce the engagement of their daughter, Renee Elaine Thomas, to Johnathan Robert Bickett, son of Jim and Jane Bickett of Morganfield, Ky.

Renee is a 2009 graduate of McIntosh High School. She attended Western Kentucky University in Bowling Green, Ky. and graduated in 2013 with a Bachelor’s degree.

Johnathan is a 2008 graduate of Union County High School in Morganfield, Ky. and a 2012 graduate of Western Kentucky University. He is employed by Northwestern Mutual Insurance as a financial advisor in Owensboro, Ky.

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Humorist Cathy Lee Phillips to speak at Fayetteville First UMC

Delivering “humor with a message,” Cathy Lee Phillips will speak at Fayetteville First United Methodist Church at noon on Tuesday, Feb. 4, at Titus II, a lunch and learning event.

The entire community is invited to hear Phillips’s stories and parables that reflect how she experiences God in the ordinary events of life.

“Her simple yet poignant message speaks to all ages through a down-home style,” a spokesperson said. “Her heartwarming words deliver a challenge to expect spiritual surprises each day and to recognize God’s presence in life’s moments.”

read more

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Confused By The "Artificial Market"? Deutsche Bank Explains It All

Yesterday, Deutsche’s Jim Reid was kind enough to put modern capital markets in their most proper context: “in these artificial markets the percentages are skewed towards the bulls for now.” Today, for everyone confused how to navigate the “artificial market”, Reid has the much needed explanation. To wit: “So far this year markets have gone down on good data, gone up on good data, gone down on concerns over weaker data and also gone up on weaker data.

And now you know everything there is to “know.”


    



via Zero Hedge http://ift.tt/1aohqJK Tyler Durden

Confused By The “Artificial Market”? Deutsche Bank Explains It All

Yesterday, Deutsche’s Jim Reid was kind enough to put modern capital markets in their most proper context: “in these artificial markets the percentages are skewed towards the bulls for now.” Today, for everyone confused how to navigate the “artificial market”, Reid has the much needed explanation. To wit: “So far this year markets have gone down on good data, gone up on good data, gone down on concerns over weaker data and also gone up on weaker data.

And now you know everything there is to “know.”


    



via Zero Hedge http://ift.tt/1aohqJK Tyler Durden

Volcker Is LOLkered As TruPS CDO Provision Eliminated From Rule To Avoid "Unnecessary Losses"

So much for the strict, evil Volcker Rule which was a “victory for regulators” and its requirement that banks dispose of TruPS CDOs. Recall a month, when it was revealed that various regional banks would need to dispose of their TruPS CDO portfolios, we posted “As First Volcker Rule Victim Emerges, Implications Could “Roil The Market“.” Well, the market shall remain unroiled because last night by FDIC decree, the TruPS CDO provision was effectively stripped from the rule.

This is what came out of the FDIC last night: “Five federal agencies on Tuesday approved an interim final rule to permit banking entities to retain interests in certain collateralized debt obligations backed primarily by trust preferred securities (TruPS CDOs) from the investment prohibitions of section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, known as the Volcker rule.

In other words, the first unintended consequences of the Volcker Rule was just neutralized after the ABA and assorted banks screamed against it.

But that’s not all.

As SIFMA announced today, the banks have more demands. To wit from Bloomberg:

“While we welcome the relief provided to certain holders of TruPS CDOs, we believe that regulators must address the larger problem of the inclusion of senior debt securities issued by collateralized loan obligations in the Volcker Rule’s prohibitions,” Securities Industry and Financial Markets Assoc. CEO Kenneth Bentsen says in statement. If not addressed, corporate borrowers may face higher credit costs, banks may endure “unnecessary losses wholly unrelated to the risk of the CLOs themselves, but rather due to the technical language of the final Volcker Rule.” Sifma encourages regulators to issue guidance clarifying that banks may hold CLO debt securities.

So TruPS “fixed”, and now comes the turn of the CLO exclusion. We give “regulators” 2-4 weeks before they fold on this demand as well, and soon on all other unintended Volcker consequences that the banks find cause “unnecessary losses.”

One wonders: just what in the view of ABA or SIFMA are necessary losses?

From the FDIC press release

Agencies Approve Interim Final Rule Authorizing Retention of Interests in and Sponsorship of Collateralized Debt Obligations Backed Primarily by Bank-Issued Trust Preferred Securities

Five federal agencies on Tuesday approved an interim final rule to permit banking entities to retain interests in certain collateralized debt obligations backed primarily by trust preferred securities (TruPS CDOs) from the investment prohibitions of section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, known as the Volcker rule.

Under the interim final rule, the agencies permit the retention of an interest in or sponsorship of covered funds by banking entities if the following qualifications are met:

  • the TruPS CDO was established, and the interest was issued, before May 19, 2010;
  • the banking entity reasonably believes that the offering proceeds received by the TruPS CDO were invested primarily in Qualifying TruPS Collateral; and
  • the banking entity’s interest in the TruPS CDO was acquired on or before December 10, 2013, the date the agencies issued final rules implementing section 619 of the Dodd-Frank Act.

The federal banking agencies on Tuesday also released a non-exclusive list of issuers that meet the requirements of the interim final rule.

The interim final rule defines Qualifying TruPS Collateral as any trust preferred security or subordinated debt instrument that was:

  • issued prior to May 19, 2010, by a depository institution holding company that as of the end of any reporting period within 12 months immediately preceding the issuance of such trust preferred security or subordinated debt instrument had total consolidated assets of less than $15 billion; or
  • issued prior to May 19, 2010, by a mutual holding company.

Section 171 of the Dodd-Frank Act provides for the grandfathering of trust preferred securities issued before May 19, 2010, by certain depository institution holding companies with total assets of less than $15 billion as of December 31, 2009, and by mutual holding companies established as of May 19, 2010. The TruPS CDO structure was the vehicle that gave effect to the use of trust preferred securities as a regulatory capital instrument prior to May 19, 2010, and was part of the status quo that Congress preserved with the grandfathering provision of section 171.

The interim final rule also provides clarification that the relief relating to these TruPS CDOs extends to activities of the banking entity as a sponsor or trustee for these securitizations and that banking entities may continue to act as market makers in TruPS CDOs.

The interim final rule was approved by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, the Commodity Futures Trading Commission, and the Securities and Exchange Commission, the same agencies that issued final rules to implement section 619. The agencies will accept comment on the interim final rule for 30 days following publication of the interim final rule in the Federal Register.

Attachments:

Interim Final Rule – PDF


    



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