AFME

AFME
source
Name	AFME
Formation	2009
Type	Trade association
Headquarters	London; Brussels
Region served	United Kingdom; European Union
Leader title	Chief Executive
Leader name	Adam Farkas

AFME is a trade association representing wholesale market participants in London, Brussels, and other financial centers across Europe and the United Kingdom. It acts as a convening body for banks, brokers, asset managers, and market infrastructures engaged in capital markets, investment banking, and securities services. AFME engages with regulators, legislators, and international bodies to shape policy on market structure, post-trade processes, prudential rules, and cross-border activity affecting wholesale finance.

History

AFME was established in 2009 through the merger of the Association for Central Counterparties and the Committee of European Securities Regulators' predecessor groups and other industry bodies during a period of post-crisis regulatory reform. Its founding coincided with regulatory responses following the 2007–2008 financial crisis and aligned with initiatives by the Financial Stability Board, the International Monetary Fund, and the European Commission. AFME has evolved in parallel with major developments including the adoption of the Markets in Financial Instruments Directive (MiFID II), reforms to Basel III capital framework, and changes prompted by the European sovereign debt crisis. Over subsequent years AFME expanded membership to include global banks headquartered in New York City, Tokyo, and Hong Kong, while maintaining liaison relationships with bodies such as the Bank of England, the European Central Bank, and the European Securities and Markets Authority.

Organization and Governance

AFME is governed by a board composed of senior executives from major banking groups and securities firms, with standing committees focused on capital markets, transaction banking, and regulatory affairs. Leadership interacts with other institutions including the International Organization of Securities Commissions, the Organisation for Economic Co-operation and Development, and national authorities such as the Financial Conduct Authority and the Prudential Regulation Authority. Its governance model mirrors structures used by trade associations like the Securities Industry and Financial Markets Association and the Institute of International Finance, featuring policy councils, technical working groups, and regional offices. Operational headquarters are in London and Brussels, enabling AFME to engage both UK and EU legislative processes, as seen in responses to consultations from the European Commission and testimonies before parliamentary committees such as the House of Commons Treasury Committee.

Membership and Activities

AFME's membership comprises major investment banks, commercial banks, broker-dealers, and market infrastructure providers, including firms headquartered in Frankfurt, Paris, Madrid, Zurich, Milan, and Amsterdam. Members participate in working groups on derivatives, capital markets, clearance and settlement, and trade reporting. AFME organizes conferences, roundtables, and technical briefings attended by officials from the European Parliament, national treasuries, central banks such as the Deutsche Bundesbank, and international standard-setters like the Basel Committee on Banking Supervision. It also coordinates industry responses to legislative initiatives from bodies such as the European Banking Authority and the Council of the European Union and engages with exchanges including Euronext and London Stock Exchange Group.

Policy Positions and Advocacy

AFME advocates positions on market structure, liquidity, capital and leverage, derivatives reform, and cross-border equivalence between the United Kingdom and the European Union. It has submitted formal responses to consultations on frameworks like MiFID II, the European Market Infrastructure Regulation (EMIR), and revisions to Capital Requirements Regulation (CRR). AFME often emphasizes harmonization of rules across jurisdictions to reduce fragmentation affecting trading venues such as BATS Global Markets and NASDAQ OMX, and supports initiatives to enhance post-trade efficiency alongside infrastructure providers like Euroclear and Clearstream. Its advocacy engages elected bodies and regulators, including appearances before the European Parliament Committee on Economic and Monetary Affairs and technical exchanges with the International Swaps and Derivatives Association.

Publications and Research

AFME publishes research papers, position papers, and market reports on trading volumes, capital markets financing, post-trade efficiency, and stress testing implications for wholesale participants. Publications have addressed topics tied to the Basel III framework, systemic risk analysis referenced by the Financial Stability Board, and assessments of market liquidity observed during episodes associated with the Greek government-debt crisis. AFME's research draws on data from clearing houses such as LCH, central securities depositories like Euroclear, and trading platforms including Chi-X Europe. It also produces guidance notes for members on compliance with rules issued by the European Securities and Markets Authority and supervisory expectations from the Bank of England.

Criticism and Controversies

AFME has faced criticism for perceived industry lobbying on issues such as capital requirements, transparency of derivatives markets, and the balance between regulatory prescriptiveness and market functioning. Critics including consumer advocacy groups and some policymakers have compared its positions to those advanced by associations like the Financial Services Forum and argued that trade associations may prioritize member commercial interests vis-à-vis reforms endorsed by the Financial Stability Board or legislative initiatives in the European Parliament. Controversies have arisen around influence during high-profile reforms such as MiFID II and EMIR implementation, and disputes over published analyses that regulators or academics from institutions like London School of Economics or Oxford University have contested.

Category:Financial services trade associations