FMSB Cites “Most Productive” Year in Annual Report

The FICC Markets Standards Board (FMSB) has issued its annual report in which it highlights “significant progress” during its “most productive” year since it was established in 2015 following the UK’s Fair and Effective Markets Review.

FMSB, which was established to enhance standards of behaviour in FICC markets – it largely mirrors the FX Global Code in currency markets – also laid out its priorities for the year ahead, including the publication of a Standard and Spotlight Review on precious metals markets; a second behavioural conduct analysis; and a draft statement of good practice on electronic trading platforms.

“Despite the challenges presented by the COVID-19 pandemic, we worked extensively with our members and others to maintain a high level of productivity during 2020,” says Mark Yallop, chair of FMSB. “Ten publications in support of our purpose: to strengthen trust in wholesale FICC markets by raising worldwide standards of conduct for all participants; enhancing overall transparency, fairness and effectiveness, reflect the continued strong engagement, dedication and insight provided by market practitioners across our member firms. I would like to thank all our members and their people for the strong commitment and support received in a year like no other.
“2021 has already seen the publication of some important pieces of work on Libor transition and the use of term risk-free rates as well as the finalisation of the Standard on the execution of large trades in FICC markets,” he adds. “We are continuing to scan the horizon for new emerging vulnerabilities, which will form the basis of our future work.”

FMSB stresses the support it continues to receive from the Bank of England and UK Financial Conduct Authority (FCA), this support is evidenced in the annual report with BoE Governor Andrew Bailey writing, “As I have said in previous years, FMSB performs an important role in wholesale markets, shedding light on best practices in areas of genuine uncertainty. Its continuing work on Libor transition has been constructive, both in supporting the migration of new business and back-book transactions, and developing principles for the use of Term Sonia. FMSB has shown in 2020 the value of the private sector using its expertise in conjunction with regulators, developing high-quality, practical protocols for the conduct of business. I look forward to the FMSB’s future contributions as it continues its mission to improve the transparency of wholesale markets.”

Nikhil Rathi, CEO of the FCA, adds, “FMSB’s private sector members, drawn from across markets, play an important complementary role to that of the FCA and other regulators around the world. I look forward to continue working with them on important market transparency topics, including the growing role of new technology in markets, the development of green finance to support the transition to a low carbon economy, and the completion of the transition away from Libor.”