Top Five Venues Execution Report
NatWest Markets Plc [*] & National Westminster Bank Plc are required under MiFID II to take sufficient steps to obtain the best possible result for its clients when executing and must also make disclosures by publishing reports on execution venue selection (Regulatory Technical Specifications 28).
Further to these obligations as laid out under MiFID II Delegated Regulation C(2016) 3337 and the associated Annex to the Commission delegated Regulation supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards for the annual publication by investment firms of information on the identity of execution venues and on the quality of execution (Regulatory Technical Specification 28).
Please follow the below links to access the respective information:
|Reports||Reporting Period||Report Format|
|RTS 28 - NWM Transactions||2017||.xls|
|RTS 28 - NWM Securities Financing Transactions||2017||.xls|
|RTS 28 - NWB Transactions||2017||.xls|
Correction to Top Five Execution venue information contained in table (g i) updated as of 31/05/2018.
For further information regarding MiFID II, please click here.
[*] - NatWest Markets Plc is the new legal entity name of the Royal Bank of Scotland plc from 29 April 2018.
RTS 28 Summary Statement
This information sets out the top 5 execution venues where NatWest Markets Plc or National Westminster Bank Plc as the context may require (“NatWest Markets”, “we” or “us”) executed Retail Client and Professional Client orders in financial instruments in the preceding year. We are members of the Royal Bank of Scotland Plc (“RBS Group”).
For FX Forwards/Swaps, FX Options, Rates, Credit, and Money Market Instruments, NatWest Markets transacts in a principal capacity and the only execution venue is NatWest Markets.
The most important execution factors NatWest Markets takes into account to obtain Best Execution for transactions in these instruments are price, size and speed of execution. The priority of any one of these factors over the others depends on the specific instructions from the client. If no instructions are received, NatWest Markets generally uses the following order of priority:
1. Price. NatWest Markets uses its access to all available liquidity channels to achieve the best price for the client
2. Size. NatWest Markets uses its access to all available liquidity channels to attempt to execute the full size of the client transaction given the prevailing market conditions and instructions of the client. NatWest Markets assumes that partial fills are acceptable unless the client indicates otherwise. A partial fill occurs where NatWest Markets is unable, due to market conditions, to satisfy the whole of the client transaction and hence only provides the client with a part of its requested transaction
3. Speed. NatWest Markets endeavours to execute the transaction as soon as is practicable given the prevailing market conditions.
For Retail Clients, NatWest Markets gives the Total Consideration a higher relative importance when assessing the best result. We may also consider the other Execution Factors where we consider it appropriate or necessary to provide Best Execution.
For Professional Clients, price is usually the most important factor when assessing the best result, although other Execution Factors may be taken into account at our discretion.
Where NatWest Markets receives a specific instruction from a client relating to a transaction or a particular aspect of a transaction, we execute the transaction as far as reasonably practicable in accordance with those instructions. Specific client instructions may preclude us from being able to give precedence to price and cost when executing client orders. Therefore, please note that where you provide us with a specific instruction, we are not obliged to provide Best Execution to the extent such specific instructions apply, and this may prevent us from obtaining Best Execution for the overall transaction. Where the specific instruction only applies to part of an order, the remaining parts of that order will still be subject to Best Execution.
NatWest Markets has an obligation to monitor the effectiveness of its execution arrangements and its Order Execution Policy, and where appropriate, correct any deficiencies. NatWest Markets will review on a regular basis whether the venues and liquidity sources it uses allow it to provide the best possible result on a consistent basis. To evidence fair outcomes in accordance with our local legal and regulatory requirements, NatWest Markets has implemented a number of controls with primary focus on pricing based on:
Observable Pricing: Where clients trade with NatWest Markets in financial instruments for which observable market prices are available, NatWest Markets attempts to benchmark the pricing of the financial instrument against what is achievable on external (non-NatWest Markets) venues. To the extent that pricing on external venues is indicative and cannot be executed against, NatWest Markets seeks to establish that the pricing we provided was reasonable within an established framework utilising these inputs.
Unobservable Pricing: Where clients trade with NatWest Markets in financial instruments for which there is no observable price available in the market due to various factors (including but not limited to the unavailability of observable venue pricing, the illiquidity of the financial instrument and/or the bespoke nature of a particular client trade and/or negotiated price) then in certain circumstances, based on internally developed tolerances, NatWest Markets seeks to reconstruct the price on a sample basis. The price reconstruction uses, as far as possible, either industry accepted pricing models or NatWest Markets’ proprietary models with market observable inputs to assess the pricing achieved.
Third party execution venues
For listed derivatives consisting of futures and options traded on exchange or trading venue NatWest Markets takes orders from clients. Generally there is only one execution venue available to execute the order in which case, where we are member of the relevant venue, we act in accordance with the client’s instruction and execute on the available venue. Where a client order is for a block which is too large to be executed on venue, NatWest Markets provides Best Execution by applying the same Execution Factors it applies for principal business (see above).
Third party brokers
For exchanges and trading venues where we are not a direct participant, we place orders given to us by clients with brokers. Some brokers are third parties and our US broker a member of RBS Group. We use different brokers for different markets but because the volume of business is relatively small, we try to use as few brokers as possible to achieve economies of scale. Our brokers have been selected to provide Best Execution on the basis of strength and depth of exchange and clearing memberships, expertise, quality of service and value.
This information including associated data reports shows NatWest Market’s top 5 execution venues in terms of trading volumes where it executes client orders in financial instruments and information on the quality of information obtained. It is not marketing material or investment advice and is for information purposes only. The information is required by law pursuant to the provisions of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC, the Commission Delegated Regulation (EU) 2017/576 of 8 June 2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council with regard to regulatory technical standards for the annual publication by investment firms of information on the identity of execution venues and on the quality of execution and the rules of the Financial Conduct Authority and is limited to the provision of execution services to you by NatWest Markets from the European Economic Area (EEA).
 Total Consideration is made up of the price of the financial instrument (including any bid/offer spread and the costs related to execution, which includes all expenses incurred by a client which are directly related to the execution of the transaction, including execution venue fees, clearing and settlement fees and any other fees paid to third parties involved in the execution of the transaction. It does not include any sales commission or mark-up (“sales margin”) that may be charged by NatWest Markets.
- available price in the market;
- transaction costs (including fees charged for execution on any particular venue, and clearing and settlement costs);
- speed of execution;
- the likelihood of execution and settlement (depending on liquidity in the particular market);
- the size and nature of the transaction; and
- any other consideration that it deems to be relevant to the execution of that transaction.