Message from the Chief Executive
2021: a packed agenda
by Martin Scheck
ICMA has had an exceptionally active first quarter of 2021, despite the fact that all our staff, except those based in Hong Kong, continue to work remotely given the COVID-19 pandemic. It is now a full year since starting this process, with a short period towards the end of last summer when we were able to reopen our offices briefly before a resurgence required us to close them. Whilst we are all looking forward to the pandemic being behind us, I am constantly impressed – and grateful – that our staff remain so effective. In this edition of the Quarterly Report there are a number of articles focused on our work in Asia-Pacific, led by our office in Hong Kong. We have recently released two highprofile reports, one on the Asian International Bond Markets, and one entitled The Internationalisation of the China Corporate Bond Market, an important theme we have been supporting for many years. Overall, our footprint in AsiaPacific continues to grow along with our Asian membership, led by our focus on sustainability and primary markets. In primary markets, the current consultation on DCM practices from Hong Kong’s Securities and Futures Commission is a welcome opportunity to share detailed guidance from our Asian members, including our Asian Bond Syndicate Forum and Asian Legal and Documentation Forum. In southeast Asia, we have just been appointed to the Industry Advisory Panel of the ASEAN Joint Sustainable Finance Working Group, and we are actively cooperating with the ASEAN Capital Markets Forum on the creation of ASEAN sustainability-linked bond standards. Let me draw your attention to the section in this Quarterly Report detailing our involvement in the Common Domain Model (CDM), where we have embarked upon an initiative to digitise the lifecycle events of repo and cash securities. The CDM is an open-source repository comprising digital representations of the lifecycle events of financial products. This is an important project for ICMA, and we are working together with ISDA and ISLA to expand the range of financial products in the CDM. PAGE 5 | I SS U E 61 | S ECOND QUARTER 2021 | ICMAGROUP.ORG
In Europe this is the first Quarterly Report since the end of the EU/UK post-Brexit transition period, and we provide a review of the way the markets functioned during the period. In primary markets, secondary and repo markets, and asset management, the preparation undertaken by market participants ensured the markets continued to function without a hitch. The EU/UK MOU, as expected, provides a framework for regulatory cooperation in financial services between the EU and the UK, but does not move the equivalence discussions forward. This, and other post-Brexit related issues, are discussed in more detail in the Quarterly Report. A major ongoing theme for ICMA has been representing the industry in discussions with the EU authorities on the problematic issue of mandatory buy-ins under the CSDR. We submitted our responses and suggestions in early February based on evidence received from our members. Separately, on the specific issue of the implementation timetable for the CSDR, we organised and coordinated a letter to the authorities signed by 15 associations. You may remember that, in 2020, based on extensive input from our members, we provided a comprehensive report to the European Commission on the rationale for a bond consolidated tape and suggestions on its structure and governance. We were pleased to see in January this year that the European Commission’s review of MiFID II/R in 2021 will include “the design and implementation of a consolidated trading tape, in particular for corporate bond issuances – a central database, which aggregates the various post-trade data sources into a single view”. We look forward to contributing to this. ICMA’s involvement in the complex LIBOR transition initiative has increased in intensity this year. Whilst the recent announcements by the authorities have provided welcome clarity, the timetable is short and from a bond market perspective the focus is firmly on dealing with the “tough legacy” issue. As you will see from the contributions inside
