In response to the introduction of pre and post trade transparency requirements under the Markets in Financial Instruments Regulation (“MiFIR“), the European Securities and Markets Authority (“ESMA“) on May 2, 2018 published its first liquidity assessment for bonds. This was published on its Financial Instruments Transparency System, found here.

Alongside the assessment was a press release, available here. The press release explained that in the first quarter of 2018, 220 bonds out of 71,000 which were assessed were sufficiently liquid to be subject to the real-time transparency requirements of MiFID II.

The bonds deemed sufficiently liquid following the assessment will need to comply with the transparency requirements under MiFIR and MiFID II from May 16, 2018 to August 15, 2018, when the next quarterly assessment will become applicable.

Interestingly, the press release highlighted that the quality of the data in the review is dependent on the data submitted to ESMA. ESMA stated that due to the lack of completeness and other quality issues in relation to the data, the number of liquid instruments was lower than that produced through previous calculations.