The Markets in Financial Instruments Directive (MiFID) is still producing problems for investment banks – and opportunities for IT specialists.

Research by MiFID think-tank JWG-IT has revealed that one of the main challenges facing investment banks is reconstructing centralised order books in the face of “drastic” increases in competition across all asset classes and trading volumes that are “heating up”.

According to P.J. Di Giammarino, CEO of JWG-IT, “The larger the investment firm is, the more difficult it is to ensure that the relationship across different businesses, multiple asset classes and geographies are aligned.”

One of the sticking points of MiFID, which should have been implemented on 1 November last year, is the whole concept of proving ‘best execution’ of trades. According to the survey, 75% of respondents expect to change execution policies this year and 33% will have multiple policies to change.

“We’re in uncharted territory when it comes to looking at how one handles a best-execution challenge,” says Di Giammarino. “Very few firms have thoroughly tested their ability to comply with what is a new requirement for their complex infrastructures.”

Overhauling these existing systems is where the work is, reckons Chris Pickles, chair of the MiFID joint working group. “The big business is in process re-engineering,” he says. “Institutions will need software development, systems integration, consulting across the board. There are thousands of firms across Europe. If you look at the UK alone, there are hundreds of member firms of the London Stock Exchange, plus the hundreds of buy-side firms that are affected. There’s a lot of business to be had.”

Simon Walker, director of IT recruiter Project Partners, says that due to the finite nature of the work, the demand is mainly for contractors.

“We’re getting a lot of demand for contractors looking at how you store financial and client data. Because of the vast changes in the way they collate and store that data, it’s changed the shape of the business processes, so what we’re getting is a lot of demand for financial IT change managers.”

Walker says that the rates for contractors haven’t gone up, however. A relatively junior position will pay 450 a day, while a project management position pulls in an average of 750 a day, which can rise to 900 at the larger institutions.