65% of Financial Services Firms Yet To Identify or Plan MiFID Budgets, Reveals Second SunGard-TradeTech Survey.

LONDON -- SunGard (www.sungard.com), a leading global provider of software and processing solutions for financial services, and TradeTech (www.tradetechonline.com), a leading global conferences and research firm, announced today that, according to the two firms' joint second MIFID readiness survey, nearly two thirds of financial services firms have yet fully to identify budgets related to the Markets in Financial Instruments Directive (MiFID), with under a year to go until its planned implementation in November 2007.

The survey, the second in a quarterly series of polls by SunGard and TradeTech to gauge the changing attitudes of financial institutions towards MiFID, reveals that 65% of firms either have no overall plan or are yet to fully identify MiFID-related budgets. However despite this, general confidence remains high, with 80% of those questioned feeling that their firm remains on track with its MiFID preparations, only a slight drop from 84% two months ago.

The survey also reveals that of those respondents who had indicated making MiFID budget provisions, 50% have allocated less than [euro]1 million, whilst 18% have budgeted between [euro]10 and [euro]40 million. 330 financial institutions have now completed the SunGard-TradeTech MiFID survey with 102 firms taking part in this latest round, in which global investment banks and global asset managers made up 44% of respondents, whilst 13% and 9%, respectively, came from European or domestic sell- and buy-side institutions.

Once more, exchanges were cited as the most likely to suffer from MiFID over the next ten years with 46% of respondents holding this view, up from 42% two months ago. The recent announcement that seven leading banks plan to launch a European equities trading platform to compete with Europe's exchanges seems to support this finding, though the survey was completed before this announcement.

The survey also suggested that ensuring best execution for equities remains a challenge for Europe's financial institutions. Whilst 31% of respondents thought that they would have this in place by the end of the year when asked in September, now only 18% are confident of this timetable. The majority, 51%, now believe that their organisation will know how to ensure best execution by March 2007.

In the area of systematic internalisation, 73% of respondents think that less than a fifth of buy-side firms will become internalisers over the next five years. However, of the firms that plan to become systematic internalisers, 75% admitted to having not yet started the necessary process to achieve this.

Overall opinion remains mixed as to whether MiFID is a good thing for Europe's economy and there even seems to be a hardening of opinion against the Directive. 31% think that MiFID will not be in the European economy's interests over the next five to ten years, compared to 23% three months ago. 33% are unsure about its effect, while 36% think that it will be good for the economy.

Pablo Orbiso, vice president at Citigroup Global Markets Limited, who participated in a telephone interview, commented, "We are on track with MiFID implementation, but there are several open questions about how the Directive will be implemented that we are working on clarifying. Citigroup Investment Bank (CIB) has set aside a significant sum of next year's budget to implement any MIFID related changes in order to adhere to the new rules by November 2007. The forecast considers costs such as technology changes, training, legal and compliance, etc. Overall, we are viewing the project favourably because although it will have significant costs, the main benefits will be to simplify and unify the trading environment across EuropeC*that is, as long as the national regulators have a unified and consolidated interpretation of the key MiFID rules."

However, Sheena Kelman, director, head of dealing at Martin Currie Investment Management Ltd in Edinburgh, offered a different view point: "The timing, for an automated solution, is getting very tight. Companies are unlikely to waste huge amounts of resource on final processes and systems, until the requirements are clear. The industry generally needs about an 18-month lead time to make really major changes to their processes. Unless the MiFID deadline changes, or the proposals are relatively straightforward, then the nearer we get to November 2007 the less likely it is that, however willing it is, the industry will be able to comply."

Richard Thornton of SunGard Consulting Services, said, "MiFID's impact on Europe's equities trading landscape is now beginning to emerge. In the last few weeks we have seen significant announcements, such as the seven banks' launch of an equities platform and the launch of Equiduct, a new pan-European Exchange, which have both been influenced by the Directive. Although it is encouraging to see that most firms remain confident about preparations, it is also interesting to note that many are yet to commit significant budgets. For many, there seems to be an attitude of 'wait-and-see' as MiFID's implications become clearer over time."

Since its launch in September 2006, participants in the SunGard-TradeTech MiFID readiness survey have included representatives from global investment banks, institutional and private client asset managers, consultancies and exchanges from Europe, the United States and Canada. To view details of the survey results to date please go to www.sungard.com/mifid.

About TradeTech

TradeTech is part of Worldwide Business Research (WBR), which is dedicated to meeting and exceeding the needs of its customers around the globe. Working in partnership with key industry leaders, WBR organizes highly focused conferences and provides other services that deliver timely, objective, accurate information and business solutions to its clients. WBR is committed to ensuring that its events and services facilitate information gathering and network creation. Visit TradeTech at www.TradeTechOnline.com

About SunGard

With annual revenues of $4 billion, SunGard is a global leader in software and processing solutions for financial services, higher education and the public sector. SunGard also helps information-dependent enterprises of all types to ensure the continuity of their business. SunGard serves more than 25,000 customers in more than 50 countries, including the world's 50 largest financial services companies. Visit SunGard at www.sungard.com

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