May 06, 2009

The European unit of the Securities and Financial Markets Association (SIFMA) and London Investment Banking Association (LIBA) have announced plans to merge.

The merger between the two largest U.S and European trade associations for banks and brokers in the securities markets is a sign that the financial crisis is forcing financial lobby groups to combine in an effort to deal with new regulatory pressures, according to the Financial Times.

LIBA traces its roots to a grouping of banks formed after the first world war, while SIFMA represents 650 banks, brokers and asset managers. The merger represents the second big consolidation of financial services lobby groups in the last three years. SIFMA was itself created by the 2006 merger of the Bond Market Association and the Securities Industry Association.

"That was driven by demand from the larger industry players, who wanted the debt and equity market participants to speak with one voice. But it also involved cost savings for members of both associations," the FT said.

The new European entity - yet to be named - will be self-funded through the combined membership. It will be headed by Jonathan Taylor, currently Liba director-general.

"It is expected to be a unified, influential voice in issues affecting the international, European, and UK capital markets and will coordinate closely on global market and regulatory issues with SIFMA's Asian and US operations," SIFMA Europe said in a release.

Currently, about 40 per cent of the members of Liba and SIFMA Europe are the same institutions.

However, LIBA has been focused on equities and investment bank policy, while SIFMA Europe's area is fixed income and debt, the London-based paper said.

"The members wanted to see rationalisation of trade associations. They have been keen to get the mixture of expertise under one roof because they are complementary," Alan Yarrow, LIBA chairman, told the FT.

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in ...