The deadline for banks to implement the European Union’s
Market in Financial Instruments Directive (Mifid) will be put back,
according to Peter Farley, managing director of analyst Financial
Insights.
“The market is saying it will not happen in November 2007
because those systems would have to be ready by March next year,”
he told analyst IDC’s European IT Forum 2006.
He said, “There’s a question about what’s implemented on 1
November and where it is implemented, but everything indicates that
1 November is a firm date.”
Mifid requires banks to link their systems to a greater number
of financial markets, because banking clients are entitled to the
cheapest prices in Europe when transactions are made on their
behalf.
The regulations also require banks and other brokers to adopt a
new set of customer protection regulations. Reviews of internal
policies and systems will be needed to prove customers have been
protected.
However, the chief executive of Mifid think tank the Joint
Working Group on IT, PJ Di Giammarino, said Farley’s prediction was
just speculation.
Farley said that banks are spending on tools to help them manage
the transition to Mifid, but not on the underlying Mifid-compliant
systems.
Di Giammarino said that investment banks and other interested
parties have already set up around a dozen partnerships that will
see companies integrate trade-reporting systems.