Major Banks Unite For Transparent Stock Position Disclosures, Striving for Global Uniformity: Report

Major global banks, including Goldman Sachs Group, Inc. GS and HSBC Holdings, Plc HSBC, are joining hands to usher in a unified method of revealing clients' stock positions. This collaborative effort aims to enhance transparency and diminish associated expenses.

Together with Barclays PLC BCS, BNP Paribas BNPQY, and another undisclosed bank, the consortium is developing an instrument to mitigate the potential dangers of under-reporting, particularly when investors make so-called short bets or build stakes using derivatives, reported Reuters citing two sources.

Regulatory mandates necessitate investors to disclose held securities once specified limits are surpassed. Such stipulations often warrant intricate and lengthy scrutiny of the regulations.

To counter the intricacies and expenses of regulatory compliance, banks have been increasingly investing in RegTech, mentioned the report. Collaborating with RegTech expert Droit, the banking group aims to optimize its endeavors, further driving down costs. 

Pete Chisholm, Goldman Sachs' Global Head of Position Regulatory Reporting, told Reuters about the inception of the initiative Endoxa, the first bank-led consortium to tackle global rules on disclosure reporting. Chisholm envisions more banks aligning with Endoxa over time, further harmonizing the application of reporting norms.

The report further noted some industry experts, like Mayra Rodriguez Valladares of MRV Associates, express reservations. They believe regulatory bodies should exercise caution and closely scrutinize such collective moves by banks.

Price Action: GS shares are trading higher by 0.01% at $327.91 on the last check Monday.

This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.