It’s around 12 months since the work began on the global Legal Entity Identifier (LEI) initiative, but today the really hard work for the financial industry begins.
The Financial Stability Board is today holding its first call to coordinate the activities of the Private Sector Preparatory Group, which has been built from some 170 volunteers across the financial sector internationally. The aim is to create the necessary plan and approach for supporting a federated Legal Entity Identifier system that will be used not only in the areas of trading and financial markets but more broadly across the financial sector as a whole so that financial institutions can maximise their return on the investment that they make in implanting this new industry standard.
Over the next two months there will be a set of conference calls that enable nine Working Groups to address workstreams around governance and legal aspects, operational aspects and reference data ownership and hierarchy aspects.
Representatives of regulators, exchanges, financial institutions, data providers, numbering agencies, technology providers, consultants and standards bodies will be working towards a deadline of mid-October when they will be meeting again face-to-face to review the final results of their combined efforts before these get presented to the next meeting of the regulators of the G-20 countries in early November.
Over the next four months financial institutions will be working on their IT budgets for 2013, and implementing the LEI in 2013 has to be in that budget planning.
Reference data projects used to get tagged on to the end of budgets – they were the things that you could drop if money got tight, and of course money always did get tight. This time there will be a regulatory requirement to implement the LEI, irrespective of how tight money gets.