Editor's letter

As we look ahead to 2019, it’s clear that the year is going to throw a few challenges our way. Some are new, such as a US government starting January in shutdown. Others are old – the UK’s Brexit issue remains in chaos more than two years down the line. And one in particular continues to evolve and keep us on our toes – the march of regulation.

MiFID II celebrates its first birthday, so it’s worth asking how implementation is progressing – in particular how financial service providers are coping with legislation that upends the way they have bundled services for decades and whether it is succeeding in improving transparency for investors. Sadly, the answer to both questions is that it’s still too early to tell. 

A big concern is that while peripheral transparency could improve, any benefits could be offset by a deterioration in the calibre of research available. Some banks may step back from some detailed in-house coverage now that it comes laden with such a substantial regulatory burden. 

There’s also the GDPR, which came into force in May 2018 after its two-year transition period. Many people had laboured under the misconception that it would just restrict companies from sending people marketing emails without their expressed permission, but it’s far more wide-ranging. The legislation puts hefty restrictions on companies processing individuals’ personal data, including how it can be gathered and the security with which it must be stored. And with a fine of up to EUR 20 million for corporations that breach the new rules, understanding how to stay compliant is vital.

Throughout 2019, I hope that ‘Thinking Ahead’ will help you tackle the markets’ hurdles. Please send your thoughts and feedback on our magazine to me at ThinkingAhead@commerzbank.com