DEFINITION of International Securities Market Association (ISMA)
The International Securities Market Association (ISMA) is a self-regulatory organization committed to monitoring transactions and encouraging compliant trading in the international securities market. Founded and headquartered in Zurich, Switzerland, the organization also owns and operates offices in London. They promote the development of the Euromarkets and is acknowledged as a designated investment exchange by the Financial Services Authority, which regulates the financial service industry in the United Kingdom.
BREAKING DOWN International Securities Market Association (ISMA)
The International Securities Market Association helped establish standard trading procedures in the international capital market. It currently has more than 530 members located in 60 different countries worldwide, representing all the major active securities firms in the capital markets.
In July 2005, International Securities Market Association merged with the International Primary Market Association to form the International Capital Market Association (ICMA). The new organization works actively to regulate trade and promote high standards of market practice, regulation, and education in international debt capital markets. This is a necessary step to facilitate economic growth and promote a well-functioning system. By partnering with its members in all segments of the wholesale market, ICMA can focus on finding solutions to the most relevant issues.
The International Capital Market Association achieves this through various steps. For one thing, they build trust in the industry by promoting internationally accepted standards of conduct that outline industry-accepted guidelines, rules, recommendations and standard documentation around trading and investing in debt instruments. Encouraging dialogue between the industry and authorities is central to ICMA's mission of promoting efficiency in the capital markets. The organization brings together a disparate group of people by organizing conferences, seminars, roundtables, and meetings. In doing so, it advances the regulators' mission of high professional standards.
History of the International Securities Market Association
The organization started in 1968 after the active firms in the Eurobond market agreed to form the Association of International Bond Dealers (AIBD). It was the first version of ISMA that established a series of rules and recommendations for governing trading in the international securities market. They created certificates of achievement for global members who complied with the new structures.
In 1992, AIBD officially changed its name to the International Securities Market Association. Financial authorities viewed the institution as an exchange and subject to parts of the Swiss Federal Act of Stock Exchanges and Securities Trading (SESTA) in 1998. These rules governed ISMA until December 2016. In 2005, ISMA and the International Primary Market Association merged to form the International Capital Market Association which remains in operation today.