23 December 2014

Chris Pickles

Chris Pickles - Consultant

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MiFID and AII: Alternative Instrument Identifier

12 September 2007  |  3169 views  |  0

Just when you thought that you knew how financial instruments are identified, here comes a new way. 

One of the reasons why the MiFID Joint Working Group got started back in April 2005 was so that firms would have as much time as possible to address their MiFID problems.  One of the first problems to be identified was instrument identification – ISINs are great, but the structure of the ISIN standard doesn’t allow all derivatives to be identified uniquely.

Market regulators are going to want transaction reports on all trades on all asset classes.  They have recommended the use of ISINs.  How will they know which instrument is which if you can’t uniquely identify an instrument?  How can you clear and settle off-exchange derivatives trade automatically – STP – if everyone can’t uniquely identify what’s been traded?

At last – for better or worse – a new proposal is now out, coming from the Federation of European Securities Exchanges and driven by the MiFID deadline of 1 November.

The Alternative Instrument Identifier – AII for short.

Not many days to go to the MiFID deadline.

Worth taking some time to look at www.fese.eu.

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I help organisations that work in the financial sector around the world to understand better how the sector works, how regulations impact the business operations of financial institutions, and how to...

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