77% of financial firms are confident that they will enforce MiFID II regulations by January 2018, according to a survey by IPC Systems at TradeTech Europe. However, 45% of respondents admitted they needed further research on how to record and store trading communications under MiFID II.
From the pool of 103 people, 82% believed the use of cloud will grow in financial markets, with 40% considering it for communication needs. The survey also found that 92% are prepared to can capture and archive data to meet compliance regulations. It shows that compliance, compliance-related tasks and risk management comprise three of the top five biggest challenges for firms in 2017. Interestingly, buy-side respondents show higher concern over compliance-related while sell-side piroritise efficiencies and uncovering new sources liquidity.
“MiFID II is increasingly dominating financial firms’ agenda – and rightly so,” says Robert Powell, director of compliance at IPC Systems. “These regulations don’t involve small updates that require little or no effort; they are driving major changes in the industry that could have severe repercussions if not adhered to.”
“What’s interesting in this survey is that over three quarters of those asked are confident that they’re prepared for MiFID II, but this is contradicted by nearly half claiming they need to do more research into how this will impact communications. MiFID II is wide and varied, and businesses need to make sure they are aware of all of the articles. Stricter governance requirements and enhanced investor protection will be key under these regulations, but communications should not be overlooked. MiFID II will ultimately transform the way trading communications are recorded and stored.”
“It’s no surprise that compliance is a consistent challenge for firms, particularly as the financial industry regulation becomes much less forgiving. Moving, or considering a move to the cloud, is a sensible step. The cloud has matured over recent years and is increasingly being recognised as the next wave of innovation in fintech. It provides greater flexibility and maintains a level of security and efficiency that the financial markets industry requires under regulations such as MiFID II.”