The REGIS-TR RoundUp
The REGIS-TR RoundUp is a hub for regulatory reporting news and views from your leading Trade Repository team and industry guests from across the globe.
The REGIS-TR RoundUp
S10:E2 What's coming in 2024: ESMA's Work Plan, New Reporting Obligations & Refit Countdown
Join the Regis-TR team for this first show of 2024: Laura Rodrigquez (Head of Institutional Relations) breaks down the ESMA 2024 work plan and what it means for market participants and TRs. Also UK CEO John Kernan, Head of Business Development Nicholas Bruce and Head of Client Services Barbara Ruiz Alonso give expert insights into what market participants need to do now to prepare for 2024. With EMIR Refit on the horizon, followed by DORA and MICA developments, plus technical standards, peer reviews and data quality reports, it's going to be a busy year - don't miss our expert insights into what lies ahead in 2024.
Hi, I'm Andrew Keith Walker.
Barbara Ruiz Alonso:Hello, I'm Barbara Ruiz Hi, I'm Laura Rodriguez.
Laura Rodriguez:Hi, I'm John.
Andrew Keith Walker:Curden. Hi, I'm Nick Bruce and this is the number one regulatory reporting podcast in the EU, the UK and around the world. So join us as we go behind the scenes and under the hood to look at the big issues and news stories, companies and personalities who are shaping the world of Rektech, fintech and trade repositories. Welcome to the Registr Roundup. And remember, this podcast is brought to you by Registr, which is a six company and features members of the Registr team and special guests offering their personal opinions, not the opinions of Registr as an organisation. There is no representation made as to the accuracy or completeness of information in this podcast, nor should you take it as legal, tax or other professional advice. And welcome back to the Registr Roundup, first show of the year. Yes, thank you, we are back. We are back. All right, calm down, don't get too excited. We are back and it is one awesome year ahead, because there's a whole bunch of regulations kicking in, but all eyes are on the deadline, 29th of April, and a mere refits.
Andrew Keith Walker:We've been building up to this for a long time. We know that you have to. So this show, we are going to be getting everything organised. We are getting rid of the wrapping paper and the half eaten Terry's chocolate orange and we are getting our desks organised for what is going to be a really busy few months coming up, and it is happening here in the virtual studio. We have the full team back in the virtual studio, most of them struck down with this nasty cold that is going around Wherever you are in Europe. It seems that you've also probably got that same thing that happens every year. You work really really hard right up to Christmas, then you take a break, you eat some turkey and the next thing you know you've got the flu. Still, we are all back in the studio, slightly gruff, some of us coughing, some of us sneezing, in no particular order, but starting with the nicest and most efficient person in the organisation, back for 2024, barbara Ruiz Alonso, head of Client Services. Barbara, welcome back.
John Kernan:Thank you, andrew. Hello everyone, happy New Year, happy 2024. Really looking forward for this exciting year ahead and happy to be back in my favourite podcast.
Andrew Keith Walker:It's good to have you back, barbara. Joining Barbara, of course, is her Spanish compatriot, the pride of Spain herself, of course, with a special starring role. Today, she takes us through ESMA's work plan for 2024. It is the head of Institutional Relations, lara Rodriguez. Lara, welcome back.
Barbara Ruiz Alonso:Hi Andrew. Thank you very much. Feliz Páñol to everyone. Very exciting news and information for this year. As you said at the beginning, let's discuss a little bit about it today.
Andrew Keith Walker:Joining Barbara and Lara in the studio. Of course it's the man who used to put the canary in the wharf. Then he was in Devonshire and Never Square. Now he looks after St Mary's Axe. It is the CEO of Registria in the UK Arvarium, sir John Kern. And John, welcome back.
Laura Rodriguez:Thanks, andrew. Happy New Year, everyone. Great to be back this week. Actually is the anniversary of 10 years of Devon Registria.
Andrew Keith Walker:That's good. So, john, 10 years it's amazing you actually look younger now than you did when you joined.
Laura Rodriguez:I must have been in terrible shape when I joined that Andrew.
John Kernan:I agree with Andrew. You look the same, I will say, and that's absolutely true.
Laura Rodriguez:Thanks guys, I'll send you the money later.
Nick Bruce:What's gone wrong with me then?
Andrew Keith Walker:There is nothing wrong with you, and that is, of course, the voice of our very own voice of reason. The head of business development for Registry, armistress Nicholas Bruce. Nick, welcome back.
Nick Bruce:Thank you, andrew, and happy New Year everyone.
Andrew Keith Walker:Let's get moving with what is going to be a very busy show this week, because we have a lot to get through, and we're going to start by coming over to our head of institutional relations, laura Rodriguez, and asking you about the big news ESMA's 2024 work plan. This is a big deal for the securities lending industry, for the repo industry, for TRs, for market participants, because it outlines where the focus is going to be this year for hands-on changes, implementations, white papers, new focus for ESMA after a mere all that stuff. So why don't you break it down for us and take us through the big picture there?
Barbara Ruiz Alonso:Okay, great, let's do it. Yes, you know, this year we have been very focused on the TR side, on EME refit, but there are so much more. This paper, this work program, includes so many additional legislative projects that ESMA and the rest of the EO authorities will be working on to keep them busy and to keep us busy during the next year and, of course, for all the financial markets. There will be a lot of upcoming new challenges. I will quickly mention, just due to the relevance that it will have, the activities regarding sustainable finance. So here ESMA will deliver its final report on greenwashing. We also discussed this in the last podcast, but, just for everyone that is interested in this ESG project, they should definitely look into this on ESMA website in the coming months.
Barbara Ruiz Alonso:And I want you to get into the discussion of the main key drivers for ESMA, which are convergence one of them, of course, digital finance, mainly to facilitate the technology innovation for the effective use of the data, which is what all authorities are now looking for the entities to be able to use properly the data, and also for themselves, for their supervisory activities. So, looking at the convergence side, we solicit guidance and tools for the supervisory convergence on MIFIR, on MIFIT 2, on search selling regulation and on EMEA. Of course, and looking at the technology innovation, ESMA will issue technical standards for the European single access point. So the European single access point is a critical project for ESMA where they want to provide free and centralized access to financial and sustainability-related information about the EU companies and all the EU investment entities and investment products.
Barbara Ruiz Alonso:This huge project is expected to become operational in July 2026, so still a lot of work to do and many consultation papers to come. Actually, there is now one open on ESMA website for those interested and in this consultation paper they have started to define the task of the technical standards that the data collection bodies which will be ESMA, EBA supervisory bodies, which technical standards they sell apply to validate whether the information submitted by the entities comply with the specifications with this regulation and then to make this information publicly available. So this really took my attention. On the report, this single access point and the words that will come here, the PRs we won't have much impact on this, but of course it will be mainly the entities that already have regulatory reports in obligations which will be impacted. So again, everyone that is interested, they should go now to ESMA website, look into this and see to which extent they will be obliged to commit or to comply with this reporting obligation to make this information available to ESMA.
Andrew Keith Walker:Now let's talk about technical standards documentation, because there is actually technical standards coming for Micah and Dora this year, as well as technical standards for Mithrid and Mafia that will be coming out. What's that going to mean for data quality, data harmonization, all those usual topics that seem to revolve around the publication of technical standards?
Barbara Ruiz Alonso:Yes. So, as I said, what ESMA is looking here mainly is convergence. So they will try to adapt or update these technical standards in the way to make it converge with all the different regulations that they have now in the market, so there are not inconsistencies and the different entities can comply easily with all of them without many dependencies or inconsistencies between them.
Andrew Keith Walker:Okay, good, and on that topic as well, there is going to be an impact on TRs from all of this. Isn't there? Because this is all feeding into AMIR's data quality report, which will also be coming out soon, and that's going to be quite important because obviously the data quality report affects the way that they finalize technical standards. So what can we expect from that? When's the data quality report out and what do you think is going to be the big news in that? Are you willing to make a prediction?
Barbara Ruiz Alonso:A prediction on when they are going to publish it in the context? I'm not that sure, but yes, as every year, sma will issue this data quality report as a peer review and follow up on the previous ones. There will be several activities on data quality in general for the TRs, for a mirror and SFTR data. The TRs we sell expect a follow up on several projects that SMA started last year or two years ago with the aims to improve the data and to identify still inconsistencies that might be between the regulation and the final implementations, also in the views of Amy Refit. This year data quality report will be based on last year data 2023. It will be very interesting to see also the difference between this report that will come this year and the next one, which will be based on Amy Refit. We will really see other challenges that the data will suffer with the implementation of Amy Refit.
Barbara Ruiz Alonso:Very interesting to look to this upcoming report that might be published probably in April-May. It's when SMA usually publish this information. Also, with the implementation of Amy Refit, we don't know to which extent its timelines will change, but more or less it will be meet this year. Of course, one of the points that we are expecting still from SMA. The TRs are the revision of the EMEAR public data requirements. This is still pending on SMA site to be published. It's something that TRs. We need this guidance to fulfill the obligations on public data for Amy Refit which, as I said, we still don't know really what will be the approach for Amy Refit. We don't know if it will keep the same that we have right now or there will be changes, but it's a public consideration that it will come in the next months.
Andrew Keith Walker:Tell us a bit more about the peer review process, because this isn't something we never really go into that much depth about these technical issues, but it's a really interesting area to get into because, of course, there's peer reviews on the European side and I'm guessing there must be some peer review process that also affects the UK. But, laura, starting with you, tell us a bit more about the peer review process, because this is going to be important, isn't it for TRs, because this is where a lot of the assessment of data comes from as well.
Barbara Ruiz Alonso:Yeah, absolutely so. Peer reviews are really important. It's a tool for supervisory convergence and also because it gives ESMA the big picture well, not ESMA the full market. They gave us the big picture of the consistency and the effectiveness of NCA in their supervisory practice. So this year and next year there will be very interesting peer reviews published on the European side. So, for example, one that ESMA published years ago in 2022, it was a peer review to ensure the supervision of cross-border activities.
Barbara Ruiz Alonso:So this year, esma will assess again whether the NCA's have sufficiently if they have sufficiently improved their supervision across their cross-border activities.
Barbara Ruiz Alonso:Let's say that is kind of an exam to see if the NCA's has to be properly using their supervisory tools and the regulation that is in play for their activities for their supervisory purposes.
Barbara Ruiz Alonso:So this peer review will come this year to assess this effectiveness of the NCA's activities and, yeah, I'm really looking forward to know a little bit more about this one. And, of course, there are many other peer reviews coming the one that we just discussed on data quality. There will be a peer review that is now annually for CCPs, where ESMA analyzed the supervision of the new CCPs, and this year it will be mainly about the CCPs, outsourcing an intragroup governance arrangement, so really interesting. Probably we will see that coming in a future also for trade repositories. But it's true that now the peer review is focused on these CCPs and well, additional peer reviews that will come are related with implementation of the requirements of securitization regulation so many different regulations that ESMA has put in place. Now they are doing this peer review to see to which extent they are properly enforced. So at least on the scope for the European regulation they are trying to see this effectiveness and it's great to see the results.
Andrew Keith Walker:Now, John, obviously you don't have peer review processes in the same way here in the UK, but there is some sort of angle to this that's going to be interesting from your perspective.
Laura Rodriguez:The dynamic in the UK is different because obviously you don't have multiple national competent authorities and then an ESMA type entity kind of supervising the market infrastructures on top of that. So I dare say the output that the peer reviews taking place within the European Union will be very informative for the UK, but obviously it's a different dynamic from a regulatory perspective.
Nick Bruce:I mean the FCA can't do it, but they're obviously, you'd imagine they will watch the output that's published by ESMA for their own internal review processes. Yeah, I think this is exactly right. I think Wales they would do.
John Kernan:Yeah, so the levels of the European NTAs. They will see how good or bad they are doing themselves.
Andrew Keith Walker:Okay, and so, Laura, I'm interested. Let's now we've looked at what Amir are going to be doing for the year. I want to come around each of your departments and find out what you're going to be doing for the year because, of course, traditionally January is that time when your budget's open up, your plan's get into place and you've got that long view of the milestones you want to hit. Now I want to come to you, Laura, because, of course, your relations, all eyes have been on Amir for so long. You must now be starting to focus on the next set of speed bumps that are coming this way, as they always do in regulatory reporting.
Barbara Ruiz Alonso:Yes, very interesting question, because there are so many activities for this year that I don't really know which one to, but I will try. I will say that one of the core activities that we will do regarding Amir Refit will be related with the access to data for authorities. So Amir Refit is changing also the way authorities access the data of the TRs, so we need to adapt the access that they have currently now under Amir. We will have to adapt it to the new access through Amir Refit. This is a very sensitive exercise and very important because we need to ensure that we will provide correctly the data to the authority under the new requirements. So this is a big exercise that we are doing internally and that we have already started sharing with the authorities for having their agreement and finalize all the additional paperwork, let's say, new accounts, new access, etc. And this will keep us really busy until the implementation of Amir Refit, because there are many authorities. We have around almost 50 authorities, each one of them with different access and accessing, of course, and supervising different jurisdictions. So, yeah, it is a really relevant and interesting exercise to complete and on the other side, we will have a lot of work related with consultation papers.
Barbara Ruiz Alonso:As you know, we have a full year of review of technical standards and consultation papers under Dora regulation. It seems far away from implementation because it is January 2025, but it is not that far because in this year we have consultation papers that are now open for the draft technical standards. We will have now in January, or is expected in January, the final report of a draft technical standards that were already published last year. So, yeah, dora is going to keep us very busy and, in addition to Dora, one important consultation paper that will come also this year is related with the new guidance, or guidance that ESMA wants to provide to the TDRs regarding governance. So here ESMA is increasing, putting more pressure on the TDRs and their supervisory activities by indicating the way entities or financial infrastructure, as trade reports, has to govern and how their government bodies has to be. So it's going to be a very challenging consultation for this year and, yeah, I think this, I will highlight these three aspects, let's say but yeah, mid-year we can review.
John Kernan:So it seems it's not only a tough year for participants, also for NTAs, for the TDRs themselves. It's going to be a great 2024.
Andrew Keith Walker:I can see that. I saw that as I was reading through. One of the things it mentioned which sounds a bit ominous is stress tests for tier two CCPs, which that sounds like it's going to be fun for them. Is there anything else you think in ESMA's report that's maybe beyond the world of TDRs but you think it's going to cause big ripples with their work plan for market participants?
Barbara Ruiz Alonso:Well, all related with digital finance, new technical standards and guidelines on MICA regulations. There will be also the first annual report under the DLT pilot regime, which would be very interesting to look at it when it's published and while looking into a different sector that ESMA is supervising, let's say, or adding information, a lot of different information on investment management, the credit rating agencies. Of course, they will have also a lot of activities on the supervisory activities that ESMA has with them Data reporting service providers too, with everybody's RTSS. I mean. So many information we have here, of course, discuss what we have seen, the more interesting ones and the more relevant ones for us, but there are many different activities that ESMA is working, yeah, and we're about a year full of challenges, let's say, and I would like to add now out of the scope of the ESMA report, and something that is also impacting us and will impact the reporting requirements under the Switzerland regime.
Barbara Ruiz Alonso:As you know, this year we will start the FinFRAC review, the developments on the Swiss Financial Market Infrastructure Act, we call FinFRAC, which, of course, is a regulation which has specific requirements that are working well. The regulation is on track, let's say, but there is always opportunities for improvement and that's something that the supervisor authority, finma, will start to explore this year with consultation papers to adapt this regulation, and we will be also very looking forward to have what they want to change, what they want to strengthen in this regime. And, of course, we will be there to comment on the different activities that they want to adapt.
Laura Rodriguez:I guess that was maybe to be expected after the Credit Suisse UBS situation as well.
Barbara Ruiz Alonso:Yes, exactly For sure. They will take everything into account and, as I said, the regulation is on track, but of course it's a much simpler regulation that we have in the UK. I don't think they want to change it that much, to make it extremely complex, but probably they will have identified specific deficiencies and it's something that they will raise and change.
Andrew Keith Walker:Nick, what about yourself? What's your desk looking like? Have you got it nice and tidy? Have you got your planner organised? You can see exactly where you're going, or is it a massive heap of paper that just keeps getting higher and higher for 2024?
Nick Bruce:Okay. Well, it's mainly electronic now, so at least we haven't got the paper burden. But I guess the way I look at it is I'm probably like every other team leader in every company around the world is that I've got three buckets, I guess. So the first one is what I'd like to do, then there's why I should do and then there's why I can do. So I think when you just listen to Laura and everything Laura is talking about, I think you can probably understand that there's two buckets. I'm just putting it outside the back door so I'm not going to get to them. So I think very much what we're looking at for 2024 is around the can do, because, certainly for me, there's a lot of stuff that's entrained, that's going to be coming down the line, but the immediate focus has to be around the near and around the rewrite, because that's what's going to impact our clients the most over the next six months. Really, it's going to be the next 12 months and there's a lot of immediate actions that we need to be taking. It's actually quite hard to think past those, because we're going to see that there's a constant need to adapt and adjust as Mia goes live.
Nick Bruce:But what we're looking at the moment really from my side is there's a number of things we're doing. We're looking at our website as a collective and we're updating our website at the moment to increase the refit tools that we have on it, and a lot of that is around the fact that we mentioned it previously. We still have the vast majority of our clients that are looking at refit as a Q1 development for this year, so really they're only now in earnest putting their teams together and looking to build the platform and start testing with us. So what we're looking to do is to make sure that we've got the tools so that clients can actually go onto our website and empower themselves, because you know, resources are finite and that's on our side as well, so it's to allow clients to easily access the right resources to further their programs and to assist themselves. Around that, we're also setting up further webinars. We talked about webinars, so monthly webinars until go live date. Also, my team are working directly with their client bases and talking to their clients and supporting our clients around refit as well, and we're feeding that all back into the wider collective in terms of what we need to be doing and just intelligence sharing.
Nick Bruce:We're also you know nothing that I can talk about more publicly at the moment, but I'm also talking to a number of our partners, because I'm also. What I appreciate is the fact that a lot of our clients are going to need help and assistance To get over the line and as a trade repository, obviously we're quite restricted in what we can and what we can't do. So we're working with a number of our clients and with a number of our partners to ensure that, if we can, we can introduce them to the right resources to help them with their programs. So it's really going to be that's just January, so it's going to be a really busy kind of quarter to ensure that our clients are where they need to be, so that they're all ready for go live date.
Nick Bruce:And you know, thinking past that at the moment it's. You know, I'd love to, but I think we just have to think about the here and now. I just make sure that all of our resources are freed up so they can focus on that and provide the right level of support, and I'm guessing Barbara is probably going to say things along the same lines as well.
Andrew Keith Walker:In a way we've all been here before. We remember SFTR, the Good Old Days. That was seems like a lifetime ago when we first started the show, but of course SFTR is significantly smaller. So are you basically aware of all the potential issues that are going to hit after the April 29th deadline and just need to be braced for a lot more scale and volume to deal with? When it comes to the kind of conversations you'll be having, kind of requests you'll be getting from clients, the kind of problems they're going to be coming to you and to potentially to partners to talk about.
Nick Bruce:Yeah, that's a really good question. And I again talking to buckets. I think this time of the year again, there's two buckets when it comes to scales. The first one is the scales I step on to measure my weight and at this time of the year they're definitely going out the back door because I do not want to know any resolution. I've got around exercise. That's going out the back door as well because that's not going to happen.
Nick Bruce:But in terms of the, when we look at mere reporting, the scale of this and the impact of this across market participants, you know we're talking. You know this is more than fourfold. We've got 1600 or more than 1600 clients. When you look at the EU, over 50% of all derivative transactions are reported through us. This is absolutely massive in terms of the scale. And I think the problem is it's not so much what we know, it's we know we're going to have this fallout. We know about the increasing fields, we know about the focus on reconciliations and there's going to be initial teething problems. We know that. We just don't know what they will be and that's the problem is staffing and scaling up and freeing up resources for something where we don't know where the issues are. But we know that there is going to be a lot of work involved. There's going to be a lot of hand holding after go live. But, barbara, I know you probably got some more thoughts on this as well.
John Kernan:Well, I mean absolutely in line with what you're saying, and for me, the key point is SXTR was new. At the time there was no data on it, so we had a new system and it had things that worked from the beginning, things that we well, we had to improve over the following months. But Emir already exists and, as Nick is saying, it has a huge amount of data. So most of the challenges ahead are making sure all the legacy data is updated and it keeps the flow it needs to keep in terms of reconciliation, lifecycle events, updates. Everyone needs to be aligned. So again, going back to Nick comments that some of the participants are yet not ready or are only now starting to gather the teams. This is not easy and I'm sorry to be panicking. I don't mean to, you know, raise to make anyone panic. Still, you have time. But talking about scaling the desk, on our side, it's already receiving a increasing amount of emails every day.
John Kernan:So we see from the new year and also the end of last year that those teams are waking. People are starting to talk, to investigate, to discuss, to learn what they have to do, and we're only four months ahead of the reporting start date and I'm sure everyone at some point will realize that testing, developing, talking to partners, to developers, whatever it's not something you can do from one day to the other. So, again, I would recommend to start today, start testing, start requesting us your credentials. Also, in line of what Nick is saying, the webinars that we will be doing will be monthly. Now, in the next weeks, we will do one focusing on walking through the CSV to XML converter, and also we are planning one dedicated to the recontiliation process that we know most of our clients are really worried about that, but we keep progressing and also now we're starting. There's more coming every week, every month. Our developers, our testers are fully dedicated to new things. So it's good that participants start now, because it is tough. I'm sorry to say it, but it is tough.
Nick Bruce:Even from our side.
Nick Bruce:Where's the people asking what's the key focus?
Nick Bruce:And when we look at the UAT, as we've always said, it's constantly evolving, and that's part of the web analysis that we constantly talk through, that we talk about new functionality, and the focus now is obviously ensuring that clients can test and do end-to-end testing, and it's also happened to make the adaptations, as we have had some slight schema changes, which obviously impacts us as well.
Nick Bruce:The next evolution, then, is the value added side, where it's things like the benchmarking data, so the clients can start looking at their data quality, they can understand the type of reporting that they're going to be receiving from us. But again, I can't keep asking me about these kind of aspects, but the focus at the moment has to be on the ear and now, in terms of the immediacy, is let's get testing, let's make sure all the tools are there for the end-to-end, and then we can then focus on dropping that so clients can get to groups before it goes live, so, again, they can actually start to see the tools that they'll have, the benefits that they'll be able to offer once we go forward into refit. And again, it's all about empowering clients. I mean, they're going to be surprised when they see going forward how much they're going to have sort of at their fingertips compared to what they have today, which is a real positive.
John Kernan:To me, it is also about making the right decisions. So clients will have to make sure if they want to keep following the same regime, the same roles that they are doing now, if they are reporting themselves their own obligations or if they are delegating, if they want to be more a watcher, meaning they delegate the reporting and they just receive data. We also have that role with refit, because maybe some of our clients are already late by the time they start in realizing the changes they have to apply. They will realize it's not only okay, I don't have time to do this, I have to delegate to a third party. That also means changes with us in terms of onboarding or new documentation you have to provide, and with EMEA I remember.
John Kernan:So we talked about the 10th year anniversary of June. Before my 10th year anniversary, I think I mentioned this on the last podcast. It was in October 2023. And I really remember when I started at Registria right a few months before the reporting started, the pile of paper of new contracts the week before we went live was up my size. Really, it was unbelievable.
John Kernan:We had every single person in the company opening accounts and we couldn't even open all of them because many of the participants just realized about their obligations really a few days before that. So again, I hope that doesn't happen again because we cannot guarantee obviously we can onboard everyone at the same time. We are working on a very modern website and tools so they can onboard themselves and clients can do a lot of the things themselves. But still we have to do ourselves a check, we have to do checks, we have to verify their access and everything, and that takes time. So please also benefit of our weekends and our nights at work. Do it with time, because again these things happen and I really remember those days eating pizza here at night because we had to onboard a thousand clients in a week.
Laura Rodriguez:I can remember that well, barbara. It was something like 80% of our client base came in the last four weeks before reporting start date. It was absolutely mayhem. So, yeah, that's to be avoided if at all possible.
Laura Rodriguez:From a UK perspective, I suppose I'm also looking at things this year from a three pronged approach. One is kind of BAU or housekeeping Although I probably shouldn't call it housekeeping because it's much more important than housekeeping would imply but that is things like following up on action points from our ongoing compliance work program in turn, all of this stuff to make sure that we remain robust. So there's a lot of activity going on there. Also, things like the FCA's TR portfolio letter. There are a number of items there. There are a number of items there that we're already doing, but we need to continue to monitor their development and progress and report back on that, and that's really far ranging. So it goes from things like demonstrating value for money so things like the client satisfaction survey that we did last year we went through to how you monitor your outsourcing and things like that. So there's one element.
Laura Rodriguez:The second element, obviously, is refit as well. Of course, we have the luxury, if I can put it that way, of an extra five months in the UK. But I can echo what the guys have said. One of the most fundamental things for us is to continue to support our clients with refit information. They've mentioned the working groups, etc. Which will also be a benefit to UK clients. One of the things we will certainly do next year is rerun the refit. Last year it was a breakfast briefing. Maybe we'll do the same again and this year, by the point being, we will do that post-EU implementation. So it's almost like post mortem. Maybe that's also not the appropriate way to describe it, but you know what I mean. We'll be able to give feedback on lessons learned with actual production data, and I think that will be invaluable for UK clients.
Andrew Keith Walker:Naturally, the idea that sort of springs into my head is yeah, but surely if you've got any trades at all that are open and ongoing with EU partners, you're going to have all your ducks in a row already, because they will already be reporting way before you. So do you think UK participants are really going to be using that five months effectively, or are they going to have everything lined up already?
Laura Rodriguez:I think it depends on what sort of participant you are. I mean, don't forget, we have a very diverse client base as well, from tier one banks to corporate treasurers, so they're not necessarily all cross-jurisdictional clients, they're not necessarily trading with cross-jurisdictional entities. I think it depends what sort of clients you are. Obviously the vast majority of our volume comes from our bigger tier one clients, that's probably obvious. And for those clients they will have gone through EU refit. But also we shouldn't fall into the trap in just assuming that the UK implementation will be a facsimile of the EU. There are FCA refit working groups that are well underway and will continue for the next couple of months. From that, q&a's will evolve etc. And there may be some degree of divergence, although, as we've said before, we don't expect it to be significant as the FCA themselves. We're somehow one of the architects of refit back in the day.
Laura Rodriguez:And then I suppose the third pillar Nick will be happy to hear the third pillar is to grow the business. The way I see it, with the implementation of refit you've got the ISO 2082 standard. That makes portability much easier. I also think with some of the onerous requirements from refit itself surrounding exception management, errors and emissions reporting, all that kind of stuff, and this is for you, barbara. I think that's going to make service support from your TR even more fundamental than it is today and, from where I sit, I think that presents a great opportunity for Registria UK to grow our client base.
Andrew Keith Walker:Well, on that very front, Barbara, we come finally to you, head of client services, ultimately there by the phone, where the whole team of people that got a big box of tissues for clients who are having a crisis. You've already said that. You know you're expecting volumes to be challenging. You're seeing that ramping up. Do you get a chance to actually plan for the year or do you have to basically be there with a fire extinguisher and, you know, hope for the best?
John Kernan:I try to plan, I always try to plan. I have my diary with me. I have this as a person, the Christmas person that's for people who are listening.
Andrew Keith Walker:By the way, Barbara has just held up a book that is the size of an encyclopedia. That is a big diary, Barbara. That is a very big diary Because there are many things to plan.
John Kernan:There are many things to plan Not only because I have a big family now, but also because 2024, I mean it's been the whole podcast about what's to come. I think it's no secret that there's a lot on everyone's plate. We do try to plan. I'm kind of maniacic here let's say trying to stick to the plan, although of course the extinguisher will be needed for sure At some point. This is what I'm trying to avoid trying to make awareness to everyone listening. The more we plan, the more time we do this, it will be easier for everyone. Yeah, the help desk is getting busier every day. Also, a refit is being planned exhaustively. We're trying to deliver every new development with the highest of the qualities. Also for clients that are already testing that it looks like no one is testing now. We have many clients that are already supporting us a lot on fine tuning the tool.
John Kernan:By the end of this month, our clients may expect to have a margin state end of the reports, which are very important for most of our participants. We will be also performing reconciliation by the end of January. At this stage, clients will be able to query the outcome of the reconciliation process, searching it from our website with something similar to our search and functionality for the trade activity or the trade state. This is very important because many of the questions we were receiving before at the help desk was about data quality. Again, it all goes like a cycle. Esma is very worried about reconciliation. That means NCHR and it means our participants are worried. This new tool will empower clients again to realize where are their weaknesses, with what participants they have worst reconciliation rates. That's the target of the whole release we are planning for this month. Also, after that, other reports will come, especially with the outliers and some enhancement to the reconciliation. More since we report data access functionality also very valuable for clients more reporting statistics Actually, the whole thing is being planned.
John Kernan:Clients have all the visibility. The first, let's say M-year 1.0, what we had so far, or M-year 2.0, because we had the RTSS in 2017. Now I think we really learned from the past. The tool clients will see it is far improved from what we have currently. I hope they like it. I hope they use it. Of course, I want to keep my role and my team, but I think they will be more independent and they won't be so dependent on our feedback and on our support.
Barbara Ruiz Alonso:Actually, Barbara, to continue to raise the awareness that you wanted on the client side, just wanted to comment that authorities are also asking us what is the readiness of our clients. They are really interested to know if they are using our tools, if they are ready to test, meaning that they have everything ready and on track. Of course, it's an update that we are sharing with them. What is the status of our UAT environment? Just to let you know that authorities are also asking us on client readiness.
Andrew Keith Walker:Okay, good, so everyone, it's all lies on you again, barbara. What can we say? You know Laura's job is done, yours is going to get very, very busy. And John, you've got a five months lie in lucky for you, and Nick not not so lucky for you. You're going to be busy first, but I'm guessing you then get the opportunity to pull a huge amount of knowledge and expertise together within the Registry R teams to make these transitions happen smoother for clients. The thing that I'm finding quite difficult to take on board here is that are there really that many clients who haven't got their head around a mere refit yet, because we've been talking about it for two years now?
Laura Rodriguez:Yeah, I mean that's basically the thing you need to consider as well, Andrew. I mean we talked before about cross-jurisdictional clients, but they're regularly regulatory rewrites going on across the globe at the moment. So you know, refit is not happening in isolation and if you're a tier one bank, you've been working on the CFTC rewrites etc. Etc. So it's a question of bandwidth. Even even for those huge international entities it's a question of bandwidth and it's very niche expertise as well. So it's very difficult to just scale up a project team, you know, with the commensurate level of expertise required for, for Reg, reporting.
Nick Bruce:Yeah, I think that's a really good point, john. You know and there's a difference as well between you know different entities, though, if you're talking about a tier one bank, even if they haven't been tested yet, they have a big pool of resources that they can easily reallocate, and these are experienced resources that are already working on the other rewrites, so for those teams to come in and execute a short period of time is far easier. So sometimes it's very, very hard to say are people that aren't even testing with us and not ready yet. The fact they're not testing with us doesn't mean that they haven't, and most of them have. The ones I'm speaking to, they've done the analysis, they've done the gap analysis, they've been working on their data vendors.
Nick Bruce:The thing for them is it's about allocation, it's about cost, so, but all of these guys, their projects for last year, they needed to secure the funding, probably by the end of the summer in 2022.
Nick Bruce:And that just wasn't possible. So it comes down to a funding question. So I think a lot of the groundwork has been done, but for these guys now it's about going into execution mode, and that's where I'm with Barbara in the fact that what you don't want is this being a kind of a bunfight for resources all at the last minute, and then people having to react and change maybe the structure in what they do for an interim period and then actually looking at it and then having to go. Well, actually it's not the optimum model because of things like the errors, emissions reporting, the oversight, etc. And my worry is that you're going to see people taking decisions just for the need to meet the criteria come April 29th and then realizing that they need still to then move to an optimum model, whereas the best thing for them is to have a good, easy path to develop that model from day one. But I think these are the kind of things we're going to work with clients to meet to be perfectly honest, and that's where I've got my concerns.
Andrew Keith Walker:So it is a big year. I think we can all agree on that. It's going to be a big year. It's going to be a big few months, and as we cough and splutter through this very challenging time and I'm sure you are too, if you're back at work already I'm sure it hasn't been easy Don't get in the lift with anyone. As my advice and on that front we do need to ask a few questions, don't we? About your new year's resolutions? Yes, it is a new year and traditionally we like to ask the Registry team just what they've got planned. So I'm going to come around, each of you in turn, and find out what your new year's resolution is going to be, starting, of course, with you, john. What have you got in mind?
Laura Rodriguez:Do you know what? I do have a couple of new year's resolutions, but I'm sorry to say that neither of them I'm prepared to repeat in public. So Okay, I guess what I need to do is to have another crack at giving up smoking. I gave up smoking last April when I hit 50. And yeah, for maybe I don't know four or five months and then yeah, so I need to give that another serious go.
Andrew Keith Walker:Well, you know I'm going to say now I think we should all be very positive. You gave up for four or five months. That's fantastic news, well done.
Nick Bruce:Oh, thanks man.
Andrew Keith Walker:I think that's absolutely brilliant. It's a very. I was there myself 12 years ago, you know, when I turned 40, facing it. It's a massive challenge, I'm going to say. Arguably it's harder than you know reconciling an extra 100 or so fields of data with a counterparty on the other side of the world than it is to. You know, lay off that pernicious weed. So well done, john, on that front. Keep going, keep going. Encouragement, we're having a positive session Talking positive things. Barbara, what about yourself?
John Kernan:Not sure it's really positive. But honestly, andrew, my new years of solution, it's survived, that's this year. I cannot afford anything further than that with my three kids between zero and five years old, all the flus that are coming to my house, Refit, survival, it's also a challenge. And then my age. I guess I told my husband if we survive this year, if we're three super small kids, then we're good. So survival, that's like the big line.
Andrew Keith Walker:Well, I can't tell you how much we all want you to survive too, barbara as well. But the thing is you've got to look on the bright side again. I'm going to say you know, with three children under five, then you're almost certainly going to have an amazing immune system. At the end of that, you'll be the only person who doesn't get a cold next Christmas because you'll have had them all.
John Kernan:I got vaccinated. I got vaccinated of everything I could.
Andrew Keith Walker:to be honest, Laura, are you going to be going around and injecting any national competent authorities with a little bit of the mica vaccine?
Barbara Ruiz Alonso:Actually, I always have a huge list of resolutions, but I will just comment one, the most exciting one, which is I want to improve my skills as a scuba diver. I started this year. I really like it, but I'm more scared that it's more scary that enjoying it. You know I'm not able to enjoy it yet because it's too scary, but it's, at the same time, amazing and wonderful. So I really need to, yeah, just do more immersions and more activities on this to avoid the fear.
Andrew Keith Walker:You should do something every day that scares you. That's what they say. In my case, it's trying to get my kids in the car on time for the bus. That's always terrifying If you have teenagers. You know what I'm talking about there. How can they floss for so long? And on that front, another man who has teenagers in his house and yet remains incredibly calm. Nick, what's your goal for New Year's resolution?
Nick Bruce:Yeah, I must admit I like barbers, by the way. I think survive is quite apt and I think the main resolution I've got is always struggle for time, and this is like personally. So my resolution is to actually start using my lunch times. Rather than have a sandwich at my desk and work through, it's actually do something. Take a break, walk away If I'm working from home, maybe go for a short run just to do something. So that's my resolution is use lunch times.
Andrew Keith Walker:That's a great idea. Time management. You see, these are all fantastically constructive. I think we've got a great set of resolutions there. Well done everybody, and we hope for all of you at home. You've also had a good break. Your resolutions are lined up and, you know, once you get over the obligatory cough and cold that everyone gets in January, you're going to have a good year to a good year with us as we take you through the challenges, complexities and the run up to April the 29th and then help you mop up any problems that crop up after that. And so, from all of us here at Registria, we have to draw things for a close. But first of all, no show would be complete without a big thank you to our virtual studio crew, and that is in no particular order, starting with the nicest and most efficient person in the organization, barbara Ruiz Alonso. Barbara, thank you.
John Kernan:Thank you, Andrew, Thanks everyone. Have a lovely year and I hope you listen to us throughout the year.
Andrew Keith Walker:That's fantastic and also, to the pride of Spain, every regulators best friend, it is, of course, lara Rodriguez. Lara, thank you very much. Our head of institutional relations.
Barbara Ruiz Alonso:Thank you very much, Andrew. A lot of energy for everybody for, yeah, COVID, this year that we have ahead.
Andrew Keith Walker:It's going to be a good one, and a huge thank you to the man who was originally putting a canary in the wharf. Then he was never square. Now he's looking after St Mary's axe and he's turning his health around with healthy habits of 2024. It is, of course, ceo Registria on the UK, mr John Kernan. Thanks.
Laura Rodriguez:Andrew, thanks listeners and courage.
Andrew Keith Walker:That's it. That's what it's all about. Talking of courage, the man who is the voice of reason and last year I'm just going to, I'm not, there's no competition here, I'm just saying he was my most regular co-host last year. So you know all of you need to turn up more regularly. But the man who is always here to give you his wisdom on the podcast is, of course, mr Nicholas Bruce. Nick, happy New Year to you.
Nick Bruce:Yeah, thank you, Andrew. Happy New Year to everyone again. It's good to know that my claims of fame is being regular. I'm wishing everyone a great 2024.
Andrew Keith Walker:And that's all from us. So from everyone here, registria and in the virtual studio and Liana, our producer, and of course from me, andrew Keith Walker, we wish you all a very good 2024. Come back and join us next month when we'll be going in-depth and under the hood with the big issues that are facing market participants as they get ready with a mere refit programs. And don't forget to join us on our LinkedIn page, that's linkedincom slash company, slash Regist hyphen tier, where you can find out all about the show. You can find links to new resources as we publish them and our new website and when it comes on stream, and all the developments that are taking place here at Registria. And in the meantime, from all of us, have a very safe month, have a good month. We'll see you in a month. Bye, bye.