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By Cory Levine, Wall Street & Technology

Leaders of the Securities Industry Association (SIA) and The Bond Market Association (TBMA) announced today that the boards of both groups voted in favor of a merger proposed in April. The decision now rests in the hands of the member firms of both associations. Proxies will be sent to the firms tomorrow, with a special member meeting being held on July 27 to tally the votes.

Nearly as exciting as the expected cost savings for the associations and their members is the brand new name of the organization and its corresponding acronym. The group resulting from the merger will be named the Securities Industry and Financial Markets Association, or for the hip, SIFMA. This name, along with the merger itself, is subject to member vote, and although it’s a little clunky, SIFMA is expected to stick.

SIA and TBMA presidents Marc Lackritz and Micah Green, respectively, will act as co-CEOs of the new group through the end of the year. A search is currently underway to fill the CEO role of the new group, with external candidates as well as current leadership being considered.

The organizations plan to begin leveraging the overlap of support functions to realize cost savings immediately after member approval, said James Gorman, chairman of the SIA, on a call with reporters. Though he declined to estimate those savings or identify where they might be found, Gorman did indicate that member fees will remain flat for the first year and any savings thereafter will either be reinvested in the organizations or passed on to firms through the bottom line of membership dues.

One of the intended results of the merger is greater weight to throw around on Capitol Hill on behalf of the financial markets. “Coming together allows us to have a clearer voice on developing common sense regulation,” said Green to reporters. “Clearly both organizations have very active and top-notch lobbying teams. … Bringing them together is obviously going to allow us to create a stronger team.”

The proposed merger and subsequent board approval are logical moves, and little resistance is expected from member firms, say industry observers.

“I know that the number of bond dealers over the past 20 years … has consolidated significantly, and the same is true on the securities side, so it only makes sense to consolidate these groups,” says Larry Tabb, CEO of TABB Group.

It looks as though SIFMA is here to stay, so get used it.

By Greg MacSweeney, Wall Street & Technology

As technology advances, investors’ needs shift and regulations allow for new business models, sell-side firms will compete directly with stock exchanges sometime during the upcoming decade, according to speakers at the Wall Street & Technology Executive Forum, “The Evolving 21st Century Brokerage: Business & Technology Innovations on the Horizon.”

Peter Horowitz, managing director of BearingPoint financial services and global markets lead, said that the expansion of emerging markets, new technology and changing regulatory standards, amongst other trends, will help to drastically change the industry in the coming years. Horowitz was commenting on a BearingPoint report that was released at the event, titled “Shifting from Defense to Offense: A Model for the 21st Century Capital Markets Firm.”

To kick off the event, Sean Park, managing director and head of digital markets at Dresdner Kleinwort Wasserstein, provided a video presentation that outlined a possible timeline of how financial services could change between now and 2015, as technology and regulations make it possible for new players to enter the capital markets.

“We have seen the list of the top 10 investment banks and brokerages change every 10 years, with new players breaking in and others fading away through consolidation and competition,” said BearingPoint’s Horowitz. “We can expect to see an even more dynamic shift over the next ten years as exchanges, which are searching for profits and growth more aggressively than ever before, muscle their way onto the playing field. As a result, sell-side firms must begin preparing immediately to use technology to both capitalize on alternative revenue opportunities and identify new ones.”

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