2020 Outlook: Glenn Havlicek, GLMX
Glenn Havlicek is CEO and Co-Founder at GLMX.
What were the key themes for your business in 2019?
The repo markets globally, and particularly those in the U.S., were the subject of intense scrutiny in 2019 as volatility in this critical marketplace led to questions about systemic instability. This focus on repo market dynamics reinforced, among other things, the already unfolding process of electronification in the space. We at GLMX believe strongly that efficient trade negotiation, processing and access to data – urgently required for regulatory initiatives like Securities Financing Transactions Regulation (SFTR) – have been and will continue to be key themes and drivers of the quickening adoption of technology.
What are your expectations for 2020?
Two things come to mind:
First, as SFTR implementation deadlines approach, GLMX anticipates a growing reliance on streamlined data reporting solutions in order to avoid a “multi-hop” approach in which several systems each provide partial data in the SFTR reporting chain.
Second, the looming demise of LIBOR at the end of 2021 is likely to spark heightened interest in 2020 related to crucial transition to alternative reference rates, such as SOFR. The potential financial implications of this transition are staggering and wide-reaching. As such, the search for concrete steps to ease the change is likely to hasten.
What are your customers’ pain points and how have they changed from a year ago?
Against a growing backdrop of capital and regulatory requirements, and tasked with achieving more with fewer resources, repo market participants face a number of challenges. Client concerns frequently heard by my GLMX colleagues and me include reducing operational inefficiency, optimizing trade lifecycle management, processing and reporting, and expanding access to liquidity across an increasingly complex product and counterparty matrix.
Firms are accelerating the buildout of digital transformation strategies.
Expect to see several new entrants in the equity exchange landscape.
CEO sees big potential for financial innovation in digitized assets.
Capital markets will continue to integrate and globalize.
Capital markets firms slow to adopt cloud have some catching up to do.