Compliance

Internal Controls and Procedures

Schildershoven is a privately owned institutional investor. The owners and the management of the firm believe that following the industry strict standards and the applicable laws makes an invaluable contribution to the high regard and perception of the company by its counterparts.

We believe that internal controls and supporting procedures are vital to the Company strategy and the way we operate. We have made major commitments in risk management and contingency assessment, separation of the front, middle, and back office functions, regulatory compliance, and adherence to the high ethical dealing standards.

Regulatory, Compliance and Ethical Standards

Since the LDC-related transactions at the beginning of the 1990s consolidated into one of the most impacting flows of the international capital, the codes, mandates, rulings and recommendations that have been issued by the international and the national governments, the central banks, and the major professional self-regulatory associations such as ICMA (International Capital Market Association), PSA/BMA/SIFMA (Securities Industry and Financial Markets Association), EMTA (Emerging Markets Traders Association), ISDA (International Swaps & Derivatives Association), and the others, have formed a legal framework for the broad OTC market participants. The recent measures aimed at prevention of money laundering and terrorism financing, which were developed and enforced in 2007 by the EU and the FSA (Financial Services Authority), known as The Markets in Financial Instruments Directive (MiFID), further contributed to the market discipline and transparency.

The activity of Schildershoven is covered within the UK by Financial Conduct Authority (Ref. # 597816). In accordance with Financial Services and Markets Act 2000 (Appointed Representative) Regulations 2001 Schildershoven complying with relevant FCA Rules is permitted to carry on the business of arranging deals in investments and / or advising on investments as such terms are defined in articles 25 and 53 respectively of the Regulated Activities Order.

FCA Register
FCA Handbook

Market transactions involving Schildershoven Finance B.V, or any of its affiliates, will also be guided by:
MiFID (MiFID, PDF)
EMTA Code of Conduct
EMTA/PSA Principles and Practices for Wholesale Financial Markets Transactions

 

Our Compliance & Risk Management Team monitors the market in terms of legislation on regular basis and prepares in case of any changes the Market Watch Bulletin for the internal use and notification of our counterparties.

Separation of The Front and Back Offices

We strictly separate deal origination from deal processing, position valuation and risk management. This is accomplished with a system of independent checkups and reports, in which irrelevant personnel have no involvement.

Risk Management

Assessment of contingencies is an essential element of the Shildershoven’s risk management strategy. Efficient measurement, reporting and control of various risks are vital for modeling of our trading activities in accordance with the overall strategic and risk management objectives. Our control and reporting framework deals with quantification of the credit, operational, reputational and legal. Our capability to aggregate and monitor exposures, evaluation of performance on a risk-adjusted basis and implementation of the comprehensive controls ensures that those exposures remain within the agreed boundaries. 

Counterparty Adoption & Review

At Schildershoven, an important element of exposure control is the ability to assess the counterparty legal risks. We distinguish the strength of counterparty’s financials from its operational discipline. This means that counterparty’s commitment to high dealing standards and timely settlements shall have no less weight than its balance sheet.

The compliance process generally includes the following steps:

  • Analysis of the nature, creditworthiness, holding and operational structure of each proposed new counterparty, its market profile and reputation. The level of this analysis is defined by the scope of business to be conducted with the relevant firm. Assignment of the firm’s internal risk category/rating.
  • Monthly ratings review of the approved counterparties.
  • Daily review of the credit and operational exposure to each counterparty based on the trading volumes, outstanding and forthcoming deals.
  • Review the firm’s desired exposure to the adopted counterparties, based on the counterparty's credit rating changes, operational conduct and other relevant data.