EY Investment bank transformation: from ideas to action

Investment bank transformation: from ideas to action

Ernst & Young’s Capital Markets Advisory practice is pleased to present our 2016 industry report, Investment bank transformation: from ideas to action.

Capital markets and investment banking is an industry recovering from multiple setbacks in terms of productivity,

In our prior global report, Transforming investment banks

Best regards,

Contents

Be technology-led 54-59 | legal entity management

60-65 |

66-71 |

Become client-centric48-52 |

Transform culture42-46 |

Optimize assets and operations 10-17 |

18-27 | � collateral management

28-33 | �

�34-40 |

Introduction

Principal, Capital Markets Ernst & Young LLP

Ernst & Young LLP

1Introduction |

Pillars of change

Transforming investment banks

Introduction

Optimize

and radically reducing costs

Opt

andred

Transform culture

by providing

will deliver value

meeting regulatory

Tran

by p

will

mee

Become client-centric

moving away from

business and operating models

Becclien

mov

busiope

Be technology-led

by transforming legacy processes,

support business

enabling a central focus on clients

Be t

by tlega

supp

enafocu

by Jonathan Firester

2 | Investment bank transformation: from ideas to action

cost bases.

• �

• • •

Optimizing assets and operations

•

structural reform are to enable systemically important

• �

in addition to a regulatory necessity. Successful

target operating models, implementing robust

collateral management.

•

•

•

•

3Introduction |

• �

•

and use of key metrics can make onboarding

differentiation.

transformations necessary to multiple capital markets

and industry utilities.

• Strategic transfer pricing is an important capability

arbitrage opportunities. In recent years, regulators are

•

costs by outsourcing appropriate functions to vendors,

functions to outsource can be based on strategic

function does not provide competitive differentiation, or admits economies of scale, it may be a candidate for a utility serving multiple banks. Banks must also


align culture to optimally support business models

volumes of capital markets

dramatically, many aspects of capital markets professionals’

performance incentives,

as electronic trading, central clearing, and increasing price

opportunities.

Transform culture

• Engagement

• Incentives

• Controls

• Productivity

5Introduction |

on capital markets product

constraints to resources

most valuable and strategic clients. Successful investment banks will increasingly need to measure, manage, and

data, coordinate sales and service teams across different


onboarding, documentation, content delivery, transactions,

product views of client activity, or differences in accounting treatments across business units.

Clients are also demanding more transparency into

and combining data from multiple, sometimes disparate,

to inform, motivate and coordinate various sales teams, and

•

• Client metrics

• Segmentation

•


to innovate to drive revenues will be limited. Instead,

maintenance to strategic investment.

Banks must make coordinated strategic decisions about

Be technology-led

successful banks will stay abreast of relevant new

•

due to strategic, capital, or cost considerations. Bank

processed on a product or business basis – incongruent

data governance, processes, and applications around

capital environment.

•

and client service. Providing a competitive offering

7Introduction |

•

potential for “leakage” of investors’ trade information,

may enable successful investment banks to differentiate

•

automate a wider array of repetitive activities.

• interactions, successful banks will increasingly use

• Electronic trading platforms are playing an increasing

platforms will improve price transparency, lower spreads and transactional costs, and increase trading volumes.

• Successful investment banks must also develop

need to invest in building knowledge, forming alliances


Prioritization of investment bank transformation activities

Transform culture

• Engagement

• Incentives

• Controls

• Productivity

Optimize assets and operations

• Business lines and entities

•

•

• sourcing and locations


•

• Client metrics

• Segmentation

•

Be technology-led

•

• Legacy systems

• Business transformation

• Controls and defenses

9Optimize assets and operations |

Optimize assets and operations


by Andreea Stefanescu, Ryan Bohn, Bridget Traynor, Ashley Kramer, Jenny Cha and Petar Lovric

Structural reform and the new age of the COO


Abstract:

1

1

Structural reform and COOs


across multiple jurisdictions, legal entities, business lines

2

• Collateral management

•

•

•

•

commitments toward improving resolvability, ranging from

siloed processes, limited traceability and accountability, and a lack of readily available information to support key

2

Structural reform challenges: balancing regulatory expectations with competing priorities, increasing project complexity, and larger investments

responsibility to improve operational capabilities and

structural reform face an ongoing struggle to balance


Collateral management

scenarios.

scenario.

Importance of a strong COO: understanding business operations and resolvability


business line.

Payment, clearing and settlement (PCS)

Funding and liquidity


entity planning.

Management information systems

transactional and operational systems. It also spans across jurisdictions, legal entities, businesses and functional areas.

Shared and outsourced services

1.

2.


and testing.

Legal entity structure and strategy

Operational readiness

Governance and testing

Getting structural reform right


and strategic projects.

Structural reform and the COO’s priorities

planned resolution strategies.

make decisions in a stress scenario.

Authors Title Phone number Email

Andreea Stefanescu Principal [email protected]

Ryan Bohn Senior Manager

Bridget Traynor Senior Manager [email protected]

Ashley Kramer Manager

Jenny Cha Manager

Petar Lovric Manager [email protected]

Author directory


by Janina Polo and John Boyle

The imperative for enterprise-wide collateral management


operational cost.

6

Historical, siloed collateral management

6 BIS report

Abstract:


Navigating the regulatory landscape

Current operating model Target operating model

App

licat

ions

Bus

ines

slin

es

Credit risk Credit risk Liquidity riskSettlement Other Settlement Pricing

App

licat

ions

Bus

ines

slin

es


Table 1: Key collateral regulatory requirements by theme

High-level regulatory requirement theme

Com

plex

ity8

BCBS

-IOSC

O

uncl

eare

d m

argi

n

Clea

ring

Liqu

idity

cov

erag

e ra

tio

Net

sta

ble

fund

ing

ratio

Capi

tal

RR

P

Acc

ount

ing

stan

dard

(IF

RS9

/13

and

ASC

86

0/81

5)

Tri-p

arty

rep

o re

form

(N

YFR

B)

TBA

mar

gin

requ

irem

ents

Min

imum

hai

rcut

–

secu

ritie

s na

ncin

g

Execute legal agreements

Document and report netting and rehypothecation activity Review of material terms and provisions of legal agreements

Mandatory central clearing for certain asset classes of CDS and IRS

Daily/intraday collateral valuation

Restriction on eligible types of acceptable collateral

Mandated haircut amounts and assumptions

Integration of liquidity costs funding value adjustment (FVA) in derivative valuation

Two-way risk-based initial margin (IM)

Mandatory exchange of variation margin (VM)

Collateral segregation model

Monitoring and reporting of collateral activity (e.g., concentrations, liquidity, risk Report legal entity and physical jurisdiction of collateral Track collateral associated with credit risk exposures between s Stress and scenario calculations to forecast changes in counterparty and collateral performance and calculation credit valuation adjustment (CVA) HQLA for contingent liquidity risk from derivatives portfolio

Capital effect from open disputes, unsettled and illiquid collateral Creation of policies and procedures for governing collateral management

Key

= Medium


Key collateral management operating principles1.

2.

jurisdictions and legal entities.

Ten principles for success

Securities borrowing

Sources of securities Uses of securities

Firm long

Global markets

Client long

Reverse repo

Collateral swaps

Firm short

Client short

Repo

Securities lending

Collateral swaps

Margin postingsMargin received

Central funding Treasury and market services

Internalization

Internal matching of shortpositions against rm longwill reduce external trades

Netting

Cross-product and counterparty nettingBooking strategy/CSArationalizationFCM/CCP order routingstrategy

Rehypothecation

Improved rehypothecationdecision based on internaldemandsReduced opportunity forrehypothecation related toOTC derivatives

Substitution

Reduction in need forcollateral substitutiontrades

Collect the sources and uses of collateral across business units/systems

Analyze each business unit’s existing processes for use of collateral

Aggregate the collateral/cost of funding information across business units

De ne potential revised allocation methodology

Assess revised collateral approach against current activities and quantify results

Residual funding

Changes to the amount ofnet external funding

External borrowings

Demand for hard-to-borrow securities met through internal pool

HQLA

Collateral sources

Collateral uses

Collateral sources

Collateral uses

Collateral sources

Collateral uses


and jurisdictions

transactions.10

intended to cover.

controls is often underestimated, and controls are generally deployed

10


6.

and asset classes.

Technology and data for collateral management


10.

11

High Quality Liquid Asset uffer (HQLA)

Stress testing

Downgrades (triggers in CSA/CCP)

Recovery esolution lans

Funds transfer pricing

Contingency Funding Plan (CFP)

Treasury/finance

Governance

Business Risk Committee Audit Validation Committee

New Product Approval Committee

Business Acceptance and Documentation Committee

Credit Portfolio Management Committee

Collateral Management

Liquidity buffer and double duty collateral

Initial margin (risk-based model or schedule)

Haircuts (model based or schedule

Collateral eligibility rules

Collateral projections[sources uses]

VM/IM eligibility checks

Collateral settlement

Substitution reallocation

Portfolio reconciliation

Dispute resolution

IM segregation

Client reporting

Regulatory reports –SEC, FINRA, Basel

Intraday, EOD collateral position

Cancel, exception, fail reports

SEC lockup report

Board reporting

Independent model validation

Credit limit management

Market risk management

Operational risk management Counterparty risk Internal

external audits

Recovery Resolution Plan

Dodd Frank Act (Title VII)

Basel III (LCR, NSFR, Intraday) BCBS-IOSCO Reg. W

(23 A and B)

FO trading/risk/quants/L&C

Enterprise risk management

Risk management

Client onboarding

SEC lending/borrowing

Prime brokerage

Shared basket/monetized forwards

Front office (FO)

OTC derivatives

Functional Areas

Product Types

Regulations

Repos and reverse repos

Late day trades matching

Execute compliant legal agreements

Margin call issuance

Collateral valuations

Collateral concentration limits

Risk dashboard

Collateral transformation

Trade pricing Intraday liquidity

Interagency CCR Guidance

Collateral optimization

Agency MBS

Reporting

Risk Management, Compliance and Audit

Client onboarding

Compliant legal agreements

Calculate margin haircuts

Margin call issuance

Booking settlement

Capture agreement terms

Reconciliation dispute resolution

Stock loans

Un-

clea

red

OTC erivatives

Exchange traded

Repos and reverse repos

Fixed income (Muni)

Cle

ared

Technology

Finance

Internal audit

Trade booking

Collateral data inputs

VM rehypothecation

Middle back office operations

Core functionsLegal compliance (L&C) Margin operations

11

Sample target operating model


Methodology and approach

• management.

• and anticipate demand.

•

•


1. Global programmanagement officeSupport the setup of an integrated collateral management framework. Need to define program scope, project charters and plans. Actively manage issues risk and monitor progress toward key milestones, etc.

3. Process redesignand implementationProcess redesign and

system enhancements may be required in order to meet

strategic, regulatory and business needs, while

simultaneously focusing on cost-savings and revenue

enhancement opportunities

2. Collateral capabilitiesassessmentAdopt a framework that compares the current state of collateral related processes and systems to the organization’s forward-looking needs as well as industry-leading practices

4. Internal controlstructure enablementProvide oversight and

guidance for designated areas of responsibility,

develop high-level policy procedures, define internal

controls and validation, confirm key metrics for

performance measurement, define education program

Centralization of

collateral management

We have outlined an efficient industry-tested approach for identifying, designing, implementing, and sustaining an integrated collateral management framework supporting the current regulatory environment and other operational needs, such as technological architecture, degree of automation, and integration of workflows across businesses.

Methodology and approach

Author directoryAuthors Title Phone number Email

Janina Polo Senior Manager [email protected]

John Boyle Senior Manager


by Petar Lovric, Matt Fischer, Kimberly (Corcoran) Rhatigan and Nagaraj Swaminathan

T+2: shortening the US settlement cycle


Abstract:

12

12

Design and development Testing Go-live/post go-live support Readiness assessment

Understand and identifyimpacted areas/systemsPrioritize and plan for potentialchanges, including phasingDevelop business casesIdentify specific projects anddevelop road map

Build and internally test technologyand process-related changes, asidentified in road mapExecute internal and external (client)outreach and trainingUpdate impacted documentationCoordinate with stakeholders forpreparation of industry-level testing

Execute industry-level testingPrepare and planfor transition andcutover with doublesettlement date

Execute cutover andtransition supportImplement additionalchanges in the spiritof continuousimprovement

Completed industry-wide shortened settlement cycle analysis

ISC publication of “Shortening the Settlement Cycle: The Move to T+2” whit SIFMA and ICI recommended rule changes to regulators

Obtain regulatory support and priority for T+2Regulators publish proposed rule changes

Complete industry testing

Regulators publish final rule changes and compliance datesFirms complete internal builds


Background for T+2

timelines.


between trade and settlement date.

trading activity.


constrained due to competing priorities and regulatory

investments, it is critical to conduct a rapid but robust impact and readiness assessment.

prospectuses, policies and procedures, is a critical step in

any transformation project, it will be necessary to review

Importance of a readiness assessment

documentation, policies, operating procedures and training materials.16

and custodians, as well as faster discrepancy resolution in processing allocations and agreeing to settlement

clients’ ability to make funds available for settlement on an

Managing the change

16

completion.

and trade amendments. Securities lending participants will

securities out on loan and to locate securities between

degrees of manual processing will need to make more


In summary, despite a lack of formal regulatory approvals,

will be critical, and will act as a second line of defense

Conclusion

Trade support

Syndicate operations

Trade capture Trader reconciliations

Streetside reconciliation

Middle office

AllocationsAffirmations/confirmations

Trade affirmations

Settlement

Clearing Settlement

Physical securities

Fails management

Securities lending

Mark-to-market

Inventory management Billing

Recalls andbuy-ins

Funding and treasury

Firm funding financing

Cash management

Projections from financing

Tax/regulatory reporting

Tax reporting

Operational management

reporting

Financial reporting

Trade and position

reporting

Client onboarding

Document management

AML/KYC

Account opening

Settlement instruction

management

Asset servicing

Announcement creation

Entitlement capture Payments

Election/instruction

Collateral management

Agreements documentation

Segregation

Margin calculation

Margin calls

Enterprise functions

Position keeping

Books and records

Reference data

Updates to security reference data to reflect settlement calendar correctly.Updates to stock record and accounting systems to reflectchange in settlement date.Thorough end-to-end testing of all reference data will be required to

all updates are captured correctly.

Update triggers and aging logic to accurate reporting for management of settlement risk.Counterparty credit exposure reports may need to be updated and tested accuracy within the shortened settlement cycle.

Potential change in projection process to incorporate activities completed on TD.Updates to systems used to generate projections in order to produce earlier estimates.FX deadlines for cross-border activity.Leverage electronic fund transfers vs. physical checks.

Updates to systems supporting the margin calculation and processing of margin calls.Increased resources may be required to handle the documentation changes to support the move to T+2.

Negotiate service level arrangements with counterparties regarding the timeline for providing settlement instructions for new or existing accounts.Update the notification triggers for new subaccounts received over Oasys or other automated allocation platforms to reduce lag time.

Improve coordination with upstream teams prior to key event dates to reduce risk of unintended elections.Update corporate action and dividend processing systems for ex-dates and cover/protect expiration dates.

Proactive matching and inventory management to reduce/manage fails and compliance with the US Securities Exchange Commission’s Rule 204 (SEC 204).Increase focus on processing of dually listed securities, American depository receipts, exchange traded funds, “when issued,” and 144a/Reg S products.

Negotiate arrangements with counterparties for providing allocations on Trade Date (TD).Enable TD matching and affirmation and maximize affirmation/settlement rates.Frequent communication with clients.

Update the notification triggers and modify controls to identify and escalate aged breaks earlier in settlement cycle. Potential for system process changes depending on existing automation (e.g. batch timing and break aging logic).

Expedite recall process to take place on TD in order to minimize settlement risk.Revise and test billing calculations to

accuracy within the shortened settlement cycle.Eliminate manual activities impeding efficient inventory management.

Impact key: High impact

Medium impact

Lowimpact

Prospectus fulfillment

Foreign exchange (FX)



Matt Fischer Senior Manager

Kimberly (Corcoran) Rhatigan Manager [email protected]

Nagaraj Swaminathan

Author directory


onboarding processesby Matt Pawlowski, Thomas Zaldivar, Anthony Goodwin and Petar Lovric


business needs and an increasingly competitive marketplace

positioning of onboarding, and use of key performance

source of competitive differentiation.

reporting going forward. It involves a set of regulatory, risk

Abstract:

source of competitive differentiation.

Onboarding keys to success• • Effective use of vendors/utilities• • Performance metrics

reporting or transaction processing, or undue risk

data policies.

Datamanagement

Clientexperience

Interactionlayers

EY onboarding framework

Talent hub strategy

Technology

Processes

Policy and regulation


certain business and processes. Applicable regulations add

Tools to manage regulatory complexity

also managing regulatory compliance across regulations

an important, early opportunity to make an impression

causes prospective clients to become frustrated, sever

Client experience starts at onboarding

Company reports, EY analysis.


development and maintenance of proprietary applications

implementation solutions and greater ease in maintaining

cover legal entity data management, regulatory compliance

onboarding processes.

across banks and clients, in an effort to reduce costs and

onboarding and rolling review cycles, an institution need


It is not uncommon for a client being onboarded across multiple business lines to be subjected to multiple data

same data, from multiple onboarding and operations

made accessible across

Gathering and managing client data

applications involved, developing or obtaining a golden

Online

Finance

Sales/Trading

CRM

Docs

Treasury

Risk

Compliance

ERP

Golden data source

360o

customer view

Origination systems

Onboarding channels

Enterprise-wide customer entities and attributes are maintained

Internal or external omni-channel access

Transaction systems enrich the customer master data

Enterprise information integration

Mail Phone In-person Exchange


management, regulatory compliance, operational account

locations to deliver onboarding services. Successful banks

is to differentiate between

added activities to improve overall performance and

service models can also be implemented to provide

processes are determined, location strategy and outsourcing strategy can be assessed to reduce costs and consolidate related processes into a single location and/or

can be performed by skilled

organization

Define

Analyze

Select and validate core KPIs

Develop reporting requirements and

gap analysis

Run pilot and KPIs

Finalize KPIs and gap analysis

reports, and consistency and rapid report development can

decisions and increase customer retention. Cost savings

process and maintain data integrity.


management to allocate resources and funds to appropriate

increase brand awareness and reputation. KPIs also can be used to identify and measure potential new business

by identifying and measuring documentation processes,

Improving client onboarding interaction strategies,

consistency and speed of client onboarding and life cycle

to improve troublesome processes, reduce costs and

redundancies and data costs, leading to increased client

onboarding for various types of clients and products will

Successful investment banks will move beyond just

client onboarding and overall client life cycle management a competitive differentiator.

Managing to success with performance metrics Conclusion


Matt Pawlowski Senior Manager [email protected]

Thomas Zaldivar Manager

Anthony Goodwin Senior


Author directory

41Transform culture |

Transform culture


by Joseph Sommer and Jonathan Firester

The future of research


interactions are often analyst presentations and discussions

Traditional research model is relationship-driven

analysts can no longer receive more detailed or advance

Abstract:


as big data, cloud solutions, social media and predictive

Financial Times

operational practices to determine budgets and track

Potential forces of change in research

fundamental background information, top analysts are

communicating investor sentiment regarding a company

value to clients of a top analyst for a given company or

a company’s stock is being viewed by investors can make

global assets under management.20

21

to “institutions’ need to parse out trades and commission 22

Institutional Investor’s

20

21

22

Institutional Investor

FT Advisor


26

globally.26

investors are strictly regional by tracking combinations of

are developing strategies, determining gaps and making

different locations to automatically format content or to

intelligence applications can even produce simple written

instant “clicker” audience response devices at conferences,


providers and consumers imply uncertainty. Successful investment banks will need to create strategic options, in

model, to prepare for several potential future models.

•

•

•

investor sentiment data. Analysts continue to be valued

Creating strategic options for research

•

from publicly available data and investment bank

Successful investment banks will also become even more

Investment banks will also need to develop and support a

successful investment banks may invest strategically in

investments in relevant industry entrants. A cultural

of structured or unstructured data, proponents believe

price movements, tracking product transactions or gauging


Joseph Sommer Senior Manager

Jonathan Firester

Author directory

47Become client-centric |



by Alex Rathod and Jonathan Firester


Managing multi-product relationships

across many products, and most are open to conversations

include analyst calls and visits, conference invitations, and corporate access provided, as well as transaction and

information, capital markets sales teams increasingly

Abstract:


positions may create a lending spread, incur a funding

funding costs, analyst calls or capital introduction services, may be easy to measure and attribute to individual clients.

analysis.

Data and calculations

Most capital markets businesses receive large allocations

submissions, can create incremental costs to client service,

and service efforts.

senior sales or divisional managers.


a basic level to support strategic decisions about targeted

and clients, to differentiate clients for service coverage levels or allocation of resources, to support individual client

management teams, and periodic client reviews.

revenue or product usage information.

Using the results and motivating behaviors

decisions must transparently and objectively reward

• Support strategic decisions about targeted products and clients

• clients

• levels or allocation of resources to support individual clients


Successful investment banks are currently addressing a

are restructuring client tiers, facilitating sales conversations

Actionable steps and continuous improvement

Continuous improvement areas

• Aggregation of client data

• Enhancement of client metrics and drivers

• Actionable reporting and processes

• Client pricing, tiering and service levels


Alex Rathod Senior Manager

Jonathan Firester

Author directory


Be technology-led


by

Rethinking the data model to support legal entity management

55Be technology-led |

necessitate restructuring data governance, processes

by embedding legal entity data management as part of broader, strategic bankwide programs centered on legal entity structure, booking models and business resolution

Investment bank senior management continues to be

and management data in order to develop solutions

management processes in place to identify and assess

interconnectedness and separability among key legal

Abstract:

bankwide program around legal entity structure, booking models, governance and business resolution planning will confer additional strategic and cost advantages.

How regulation created a data challenge for banks


Managing legal entity-based data effectively

detail below.

1. Identify and categorize legal entity data

resolvability may be spread across different businesses, functions, systems and databases. In addition, data governance and controls may vary in different parts of

1. data and associated systems

2. applications, processes and controls

implementation


documentation of manual processes used to manipulate or

sources of legal entity data.

following activities are important to successfully complete a

• resolve MLEs

•

•

• are correctly linked and documented

processes and controls

consolidating feeds and sourcing from an appropriate and

•

•

•

around completeness, consistency and accuracy for

are designed and implemented to provide coverage by trading product, book, desk or corporate business unit.

consistency and accuracy of its legal entity data.

applications, processes and controls, banks need to consider

•

•

•

•

•

3. Establish corporate-level sponsorship and governance

Legal entity data projects must be sponsored at a

multiple businesses, operational groups, control functions

to support legal entity resolvability will need to be made


effectiveness of legal entity data management controls.

Legal entity data governance is an ongoing and integral

staff.

Key success factors at organizations undergoing this transition

Testing and governing legal entity data controls

businesses to implement local governance routines in order to communicate among legal entity data providers

for relevant documentation to be easily and systematically

solutions.

Key legal entity data success factors

• data initiatives

• Create sustainable data collection, lineage and control processes

•

• and distribution


business strategy, regulatory compliance, operations and

and resolvability. Legal entity structures may evolve

business strategies.

Making legal entity data part of a legal entity strategy

Production, transmission and controls around legal entity

managers and resources must be made available to address issues and remediation.


Jaruwat Rujipornwasin [email protected]

Rui Bao Manager [email protected]

Manager

Author directory


by Thomas Zaldivar, Barry Kraver and Rachel Elgawly

The road forward for futures commission merchants


businesses.

What has happened to FCMs

July 21, 2010.

Abstract:

derivatives markets.

model.

and attempting to support two businesses. In part due

potential business opportunity, banks focused on tactical


The road forward

• Cost of capital

•

• segments


longer measure performance based solely on revenues or

1.

2.

result, cleared derivative transactions are now counted

leverage and reduce deleveraging stress components.

leading to increased cost of capital and less opportunity

Managing the new cost of capital

eligible positions by automating allowable offsets before

increasing its market risk. Since gross notional amounts

commodity spread involving different but related products

CCP.”

offering makes sense.

market practices.” By renouncing customer assets, banks

rate environment.


need to consolidate client service, operations, collateral

platforms unstable, and banks must now review, consolidate

infrastructure was built.

Capturing technology and operations


Focus on the costs of clients

Succeeding in a harder business


Thomas Zaldivar Manager

Barry Kraver Manager [email protected]

Rachel Elgawly Manager

Author directory


by Ravi Karra and Andrew Hosking

Shining a light into dark pools


Abstract:

operators are being investigated for potentially violating rules around dark pools and alternative trading systems

Proliferation of dark pools

Wall Street Daily, .

Internalization and Equity Markets Quality, November 2012 Issue Brief.

Growth in dark trading raises concerns over transparency, fairness, investors’ access and the basis for competition with traditional exchanges.


Market demand for controls

The Journal of Finance.

Groping in the Dark: Navigating Crossing Networks and Other Dark Pools of Liquidity.

Optimal Liquidation in Dark Pools,

Dark pool customers are now asking to review the methodologies, rules and controls within the venues.

in order to inform public policy issues related to

Dark pool concerns


Assessing dark pool quality

EY Banking and Capital Markets Publication, Dark Pools and Toxicity Assessment.

Dark pool quality metrics

• Execution performance in terms of time and price

• Protection of clients’ anonymity

• Speed, latency and throughput of connectivity

• Availability of order types


Effectiveness of controls

Ibid.

Ibid.


future enforcement action.


Ravi Karra Senior Manager [email protected]

Andrew Hosking

Author directory

EY

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About Ernst & Young’s Capital Markets Advisory practice

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Roy ChoudhuryPrincipal, Capital Markets Ernst & Young LLP

Christopher RiggPrincipal, Capital Markets Ernst & Young LLP

Jonathan FiresterExecutive Director, Capital Markets Ernst & Young LLP

Qingji Yang, PhDPrincipal, Capital Markets Ernst & Young LLP

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EY Investment bank transformation: from ideas to action