Following the 2008 financial crisis, the US and European approaches to reforming the financial sector were markedly different, with European rules resulting in far more onerous capital and trade reporting requirements. Over a decade later the impact of a greater regulatory burden, including the scale and cost of post-trade services as a result of MiFID II, coupled with less favourable economic conditions in Europe, can now be clearly observed. According to recent analysis in The Times, the result has been that American banks now devour about 53% of global investment banking revenues, up from 44% in 2008, and now even hold a 39% share of European revenues as well.
In a bid to boost profitability and reduce operational costs across European banks, a key area of focus for institutions has been how to reduce their post-trade total cost of ownership (TCO) by finding a leaner, cheaper operating model. Yet although a variety of approaches have already been attempted to date, not all of these post-trade transformation projects can claim to have succeeded. In this report, Nicola Tavendale and Mike O’Hara of The Realization Group speak to Matthieu Prieuret of Eurogroup Consulting UK, TP ICAP’s Dominic Cashman, Andrew Morrish of Technolink, James Maxfield and Ali Rutherford of Ascendant Strategy and Atomic Wire’s Colin Parry about the key ingredients needed to create an efficient and more cost-effective post-trade business.