LISA: for liquidity stress testing and scenario analysis â€“ helping firms monitor and manage liquidity and meeting the regulatory demands to strengthen it
COLLINE: For end-to-end, cross-product collateral management - mitigating credit risk while satisfying the growing demand for multiple global entities, margining, CCP, MIS reporting and electronic messaging
helping firms excel while meeting the risk and regulatory demands necessary for a stable yet profitable financial marketplace
For automated regulatory compliance at branch and head office with global coverage â€“ meeting the increase in volume and complexity of regulatory reporting while gaining firm-wide insight into operations
REPORTER MIS: for business intelligence in reports or dashboards enabling decisions to be made with confidence that the information is complete and accurate
Used by financial institutions around the world to monitor, measure and manage risk while achieving regulatory compliance
London, Hong Kong, Luxemboug, New York, Shanghai, Singapore
15. 4. Great expectations
15. Hot topics
8. Playing safe with securities
Virtual banking in the real world of international cash management Tim Nash from The SEPA Consultancy analyses the advantages virtual banking can afford international cash management.
bobsguide asks a range of exhibitors and attendees to offer a preview of what panel sessions, products and industry trends they will be discussing while at Sibos this year.
Nik Pratt reports on the steps taken to assess systemic risk and track counterparties as part of an industry-wide bid to avoid a repeat of the 2008 financial collapse.
12. Working in the dark
Sherree DeCovny investigates the possible impact of regulatory reform and technological innovation on capital and liquidity requirements and what this means for the global financial services industry.
Four speakers at this year’s Sibos predict what the burning issues of debate will be at Toronto.
24. Collaborating to conquer
common challenges SWIFT’s Wim Raymaekers looks at how financial institutions need to pool resources and know-how to overcome future regulatory and technological challenges.
33. Exhibitor list
Note from editor At Sibos 2011 in Toronto technology, regulation, the changing landscape and global and local perspectives are the key themes for debate as the industry looks to sustain its bill of good health following the global financial crisis. Last year’s event in Amsterdam focused on regulation, rebuilding trust and recovery and how Basel III, the Dodd-Frank Act and other legislation would help stabilise the markets. This year the conference is about, what one speaker described as, “digesting” these rules and how they could impact the future of the banking industry. The bobsguide Conference Magazine offers an editorial analysis of many of the central concerns at the heart of this year’s conference. We questioned exhibitors and panellists to see what they thought would be the hot topics of discussion in both the sessions and on the conference floor, while we have called on industry experts to provide an analysis of important areas surrounding risk management, securities infrastructure and new technologies. The magazine should enable you to get to grips with the big issues and provide greater insight into what 2012 and beyond holds in store for the industry. Although as many of us know, nothing can ever be taken as guaranteed. Jim Ottewill
Staff Editor: Jim Ottewill email@example.com Chief executive: Mike Hewitt firstname.lastname@example.org Sales director: Anne-Marie Rice email@example.com Art and design: Donna Jones firstname.lastname@example.org Contributors: Nik Pratt, Sherree DeCovny, Tim Nash, Wym Raymaekers Advertising sales: Alco Brand email@example.com Eddie Drew Edward@bobsguide.com Stephen McMaugh Stephen@bobsguide.com Admin and support: Jabra Sayegh firstname.lastname@example.org About bobsguide bobsguide, an AFP® company, is the premier financial IT solutions network, connecting financial IT buyers with suppliers. On bobsguide, financial IT suppliers from across the globe interact with IT, treasury and financial professionals and exchange information about robust, practical financial systems and software. As part of the Association for Financial Professionals®’ global network, bobsguide lists over 45,000 members and vendors and features the latest financial technology news, RSS feeds, jobs and announcements. 3
Great expectations Dialogue, debate and discussion are at the heart of Sibos every year – bobsguide’s Jim Ottewill asked a selection of exhibitors and attendees what they expect to be talking about ahead of the 2011 event in Toronto. More than 30 years old and the status of Sibos as “the biggest event in financial services” shows no sign of abating. The comments, from Tim Brew, market development director at Logica Global Financial Products Business, echoed the sentiments of many participants in bobsguide’s pre-event survey. The reputation of Sibos as a ‘must-attend’ conference in the banking industry’s calendar is cemented by its size. An estimated 9,000 participants were in Amsterdam last year, which made it the largest conference in its history. This year’s exhibitor space sold out in March 2011, while organisers expect thousands of attendees to pass through the doors of the Metro Toronto Convention Centre when they open on 19 September 2011.
Survey participants listed a number of reasons for making the journey to Canada this year. One respondent said that Sibos is the essential event for any “serious market player” to network, meet clients and generate new business opportunities. Laure Kypriotis, marketing and communications specialist at Fircosoft, a provider of watchlist filtering and straight-through processing (STP) solutions, says that Sibos presents more leads than other conferences as “the people usually in attendance are decision makers”. Clear2Pay, a payment solutions provider, says Sibos is its “most important event for networking with clients”. The vendor has more than 90 meetings with potential clients booked in advance, illustrating the amount of leverage
Sibos offers firms looking to expand their global business networks. Other participants said that Sibos provides a great opportunity for delegates to learn more about industry developments as well as source new business. Petra Shuttlewood, corporate PR manager at Temenos, says Sibos offers a forum for the banking community to “come together to share ideas and collaboratively debate ... common issues”. Eric Campbell, chief technology officer at Bottomline Technologies, emphasised that the event is as much about play as it is about work. “At Sibos, we have the opportunity to see customers, meet with prospects, spend time with contacts across the industry, and most fun of all, connect with old friends,” he explains.
Unsurprisingly regulation and technological innovation were two of the main concerns cited by respondents in the bobsguide survey, reflected in two of the streams in the conference programme. Robert McKay, managing director at Accuity, says that for many clients, the Single Euro Payments Area (SEPA) “will be at the forefront of their minds”, as a migration date is expected to have been finalised by the European Payments Council (EPC) by autumn 2011. The payments company expects to showcase its new International Bank Account Numbers (IBAN) Complete solution at Sibos. It offers clients a conversion of Basic Bank Account Numbers (BBANs) to IBANs and identifies SWIFT-connected Bank Identifier Codes (BIC) for IBANS to ensure payments are compliant with SEPA and global regulations. Meanwhile, Logica will be unveiling a new SEPA mandate management solution, which it says offers corporates the first step towards a “full payments factory”. Logica’s Brew says that the confirmation of an end date for legacy instrument migration would allow firms to change their business strategy from domestic to a more pan-European approach. “Corporates who spot the real opportunity for this change and move to streamline and consolidate their financial processes, perhaps into a unified payments factory, will come out with big gains,” he predicts.
Temenos will be showing off its new Insight Risk Intelligence platform, a product suite aimed at helping clients adhere to new risk management and compliance requirements. Shuttlewood says that a year after Amsterdam these areas are still very much talking points for the financial services industry. “Looking specifically at risk management, we believe that Basel III and the new liquidity requirements will be top of mind for many banks attending this year, notably the liquidity coverage ration [LCR] and the net stable funding ratio [NSFR] requirements,” she says. As a result, the adoption of componentised technology will be increasingly widespread among Tier 1 and 2 banks as they look to integrate new solutions with existing architectures to save costs and meet legislative requirements, Shuttlewood explains. Hema Naryanan,
“Financial institutions continue to grapple with the challenge of legacy modernisation. The older and more established the enterprise, the greater the challenge in migration to new solutions.” vice president of marketing at Polaris Software, agrees with her comments. She says: “Financial institutions continue to grapple with the challenge of legacy modernisation. The older and more established the enterprise, the greater the challenge in migration to new solutions. Costs are significant as are the risks associated with business innovation protection.” Other IT vendors that participated in the survey underlined how the desire to boost service quality, while simultaneously keeping expenditure low, was a business driver for many corporate and banking clients, particularly as the sector continues to recover following the global crash.
Misys, a provider of transaction banking solutions, said it will be showcasing a cash management and trade finance value proposition, which it says will help drive down operational efficiency while increasing revenue options for its banking clients. Pravin Vijay, head of product marketing at SunTec, which is planning on launching two new applications at Sibos this year, also highlighted operational efficiency as a client concern. He says that global financial institutions are looking to enhance profitability by improving customer wallet share and business processes. Moreover, across the globe, banks are turning to IT solutions such as cloud computing and service oriented architecture (SOA) as a way of complying with regulatory measures. “They are looking at technology solutions, which can enable them to compete in the market leveraging innovative product offerings and also to provide compelling customer experience across various customer touch points,” he says.
The cloud and mobile technology were both cited as innovations the financial services industry is still striving to understand. Colin Kerr, industry solutions director at Microsoft Worldwide Financial
Services, says that ‘Cloud computing - the momentum gathers’ is one of the sessions his firm is most looking forward to. Kerr says that for Microsoft clients “managing the ‘consumerisation of IT’ and the integration of personal, mobile devices into the financial services corporate enterprise” and identifying which “applications in banking and payments” can be migrated to the cloud are both key issues. Campbell from Bottomline said that its banking clients are “getting push-back” from their customer bases who want simpler, easier to use applications. He said: “This [demand] is causing the industry to reinvent the way cash management applications have been developed in the past and forcing banks to further improve their customer relationship touch points.” Payments and the bank’s role in a payment cycle continues to be a question on the lips of financial institutions, particularly as technologies evolve. Brew’s Logica suggests that the traditional banking revenue collecting methods are at risk, meaning many of its clients will need to “build new channels to acquire transactions, increase sales of existing payment instruments and adapt new products and services”.
Crisis management and business continuity planning were both raised in the survey. Japanese-based firm Nomura Research Institute (NRI) said it was exhibiting for the first time in many years following the Tohoku earthquake in March to showcase its “deep knowledge” of the securities industry to a global audience. NRI is leading sessions analysing the post-earthquake risk management measures taken by finance firms and how to maintain business services during a “serious disruption”.
But Sibos is not just purely about business - networking is a large part of the Sibos experience. With numerous drinks, client parties and events expected 5
to run throughout the week, many of the evenings can be just as lively as the debate and discussion on the conference floor. Some firms will be taking advantage of Toronto’s rich heritage as a sporting capital - Logica is organising a trip to see the Toronto Blue Jays baseball game on the Sunday night before the main conference begins. A few days later ACI Worldwide will host a private suite to watch the Blue Jays play against the Los Angeles Angels.
Some firms are using the location on the north Western shore of Lake Ontario as a way to impress their clients. Again Logica is leading the pack, organising an evening cruise round the harbour of the city. Fircosoft, in collaboration with Canadian partner Expertus, is running a trip to Niagara Falls. Some exhibitors will be doing their best to attract attention at their stands. NRI will be showcasing Furoshiki at its booth, which
is a type of traditional Japanese wrapping cloth and used for transporting clothes and gifts. The firm said: “The practice is coming back in Japan as a trendy ecofriendly item. We will be teaching people how to transform this piece of cloth into marvellous bags and wrapping.” As ever with the banking industry, NRI is looking to the future and next year’s Sibos, concluding: “This skill will be useful for Sibos 2012 in Osaka!”
Lombard Risk solutions are very relevant to the issues being covered by SIBOS 2011 themes: ‘regulation re-visited’, ‘technology’, ‘changing landscape, new expectations’ and ‘global and local perspectives’.
Lombard Lombard Risk Risk
The financial market has experienced change on a massive scale since the crisis and continues to do so. Risk management and regulatory compliance are two key areas under immense pressure to operate more meeting effectively - with its many stakeholders callingdemands for better helping firms excel while the risk and regulatory helping firms excel while meeting the risk and regulatory demands monitoring, measurement, management and reporting.
necessary financial necessaryfor foraastable stableyet yetprofitable profitable financialmarketplace marketplace database jungle of silo systems. The internet and associated
Regulators have also introduced comprehensive stress tests that need to be performed for firms and regulators to gain better COLLINE: For insight into the future of a firm’s operations soend-to-end, that appropriate COLLINE: For end-to-end, collateral action may be taken to avoid cross-product any crisis. Assuring the regulator cross-product collateral that risk is being monitored, measured and managed efficiently management mitigating management - mitigating results in less capital being held by a firm so compliance, credit while satisfyingfor creditrisk risk while once, may be recognised as a ‘carrot’ rather than satisfying the ‘stick’ that the growing thepast. growingdemand demand has been endured by some in the for formultiple multipleglobal global entities, Collateral Management entities,margining, margining, CCP, MIS reporting and CCP, MISsignificant reporting and Collateral management has also seen change electronic messaging post-financial crisis. On the one hand, firms are increasing electronic messaging the volume of collateralised trades to secure transactions and ensure risk management and compliance - ISDA Margin Survey 2011 shows that 70 per cent of over-the-counter (OTC) exposure is now collateralised against 59 per cent and 30 per cent in 2007 and 2003 respectively.
technology is truly global and is a significant factor in global institutions overcoming country/regional ‘barriers’ of physical location and technology. Management information solutions operating in a web services environment excel at gathering, calculating and delivering information originating from multiple sources into a single one. This can be in the form of a standard report, or in a more easy-to-digest form of on-screen dashboards, using For Forautomated automated technology that is able to be accessed online from wherever you are on-screen, by phone regulatory orregulatory clearly oncompliance your tablet. atat compliance branch and head and headoffice office The financial services industry isbranch currently experiencing with global coverage – –a unprecedented change that is making the world appear with global coverage meeting the inin smaller place, with every country’s operations impacting meeting theincrease increase volume and complexity another. At the same time, web technology is creating an volume and complexity environment of trusted connectivity and communication that ofofregulatory reporting regulatory reporting is enabling business centres around the worldfirm-wide to operate while gaining whilemobile gaining firm-wide effectively as one in an increasingly landscape. insight into operations insight into operations Lombard Risk is growing alongside these changes. The firm is expanding, taking on more experts and introducing new products on the latest technology platforms to provide financial institutions with risk and regulatory solutions. This enables them to excel, while meeting the risk and regulatory demands necessary for a stable yet profitable financial marketplace.
RegulatoryCompliance Compliance Regulatory
CollateralManagement Management Collateral
Both the latest and planned regulatory regimes (Liquidity risk Solvency II and Basel III with 2012 deadlines) have changed the way in which firms are required to measure, calculate and report to the regulator - and the reports themselves are increasing in volume and complexity.
ManagementInformation Information Management
LiquidityAnalysis Analysis Liquidity
On the other hand, regulators are set to implement changes over the next year or so which will have a considerable Lombard Risk’s risk management and regulatory legal, operational and commercial impact on the OTC compliance solutions are used by financial institutions derivatives market. The results of these changes will mean around the world: COLLINE for collateral management, market participants will have to post more collateral and LISA for liquidity analysis, regulatory and management REPORTER MIS: LISA: liquidity stress face collateral calls more frequently from a broader spectrum REPORTER MIS:for for LISA:for for liquidity stress reporting products, in addition to its company-founding of counterparties, with tradestesting collateralised with higherbusiness intelligence and scenario solutions Oberon and Firmament. business intelligenceinin testing and scenario liquid instruments. Firms withanalysis a siloed –approach will face reports orordashboards -helping firms reports dashboards analysis helping firmsand Lombard Risk solutions are now delivered on a state-ofthe greatest challenge in meeting these –new demands enabling decisions totobe monitor enabling decisions be the-art, web-based platform which provides firms with a monitorand andmanage manage staying competitive. made with confidence liquidity and meeting fully integrated solution to improve the management of risk made with confidence liquidity and meeting that information isis – including collateral and liquidity - and meet escalating the Management Information thatthe the information theregulatory regulatorydemands demands global regulatory demands.complete and accurate totostrengthen it complete and accurate strengthen it Significant blame for the financial crisis is apportioned to management having insufficient oversight, and in some 7th Floor, 245 Blackfriars Road cases understanding, of firm-wide operations. Often London, SE1 9UF, UK this is resultant from a plethora of siloed systems, each UK Telephone: +44(0) 207 593 6700 producing in-depth analysis of individual business divisions’ Used financial institutions around totomonitor, Email: email@example.com operations, only creating a cross-product/cross-system/ Usedby bybut financial institutions aroundthe theworld world monitor,measure measure Website: www.lombardrisk.com firm-wide picture with difficulty.
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Playing safe with securities More than three years since the collapse of Lehmans and effective risk management surrounding securities transactions is more important than ever. Nik Pratt reports on how the industry is working together to increase transparency and prevent the build up of systemic risk. The Lehman Brothers default in 2008 highlighted two conspicuous failings in the capital markets - the lack of information on counterparties and the ineffectiveness of regulators. The consequence of both shortcomings was that participants had little or no warning that a major default was about to happen, then faced months of turmoil trying to unwind various transactions that carried any exposure to Lehman entities or counterparties. Financial instruments had become so complex and convoluted that very few participants were truly able to keep track of all their various counterparties or adequately assess their level of counterparty exposure. Similarly it was beyond the regulatorsâ€™ capabilities to assess the potential for systemic risk as markets span out of control. Three years on we are seeing the genesis of various regulatory-led efforts to redress this balance. In Europe, the European Systemic Risk Board (ESRB) is establishing a warning system to highlight systemic risks. Meanwhile in the US, the Office of Financial Research (OFR), a new unit of the US Treasury, has been established under the Dodd Frank Act and is charged with monitoring systemic risk in the US capital markets.
The OFR will have two main functions - the first is to establish a detailed trade capture repository that will track all securities transactions and the various counterparties. An additional unit will monitor this information in order to spot any emerging systemic risks. The first step for the OFR in achieving this ambitious aim has been to call for a standard series of legal entity identifiers (LEIs) for all securities transactions. Two organisations that will be hugely influential in the mechanics of the various macro-prudential initiatives are financial messaging cooperative SWIFT and the US-based Depositary Trust and Clearing Corporation (DTCC). Both organisations have been given joint mandates for the establishment of a LEI framework. The OFR originally asked for a fully established LEI system to be in place by July 2011 and left the industry to it. The Global Financial Management Association (GFMA), a consortium of industry associations, was left to coordinate the project by compiling a list of requirements and embarking on a tender process. SWIFT and the DTCC were subsequently awarded the task of developing the solution. The DTCC will be responsible for the data collection, validation, reconciliation and enrichment, while SWIFT will be in charge of allocating and distributing the LEIs. “Right now we are in the process of waiting for global regulators to endorse the proposal and define the reporting requirements,” says Paul Janssens, senior product manager at SWIFT. “And we are looking at assigning the LEIs to various institutions - from investment banks to bond-issuing corporates.” There are a number of challenges facing SWIFT and the DTCC as well as the regulators and the industry, concedes Janssens. One is the sheer scale of the project. More than 2.5 million entities could conceivably require an LEI and it is yet unclear how registration can be enforced for all. The project has been deliberately divided into separate phases with their own deadlines in order to maintain the momentum and make it all more achievable, says Janssens. However, it is worth noting that the OFR had originally set a deadline of July 2011 for the LEI
to be up and running. This has now been revised to the end of the year. Despite the delay, the LEI project is still progressing far faster than it ever did without the regulatory push it now has. The development of an ISO standard normally takes two to five years, rather than two to five months. “When you are pushed, you go faster,” says Janssens.” There is a sense of urgency in the industry that started with the Dodd Frank Act. I think the closer you get to a deadline, the less you argue and the more you get on with it.” The work will involve enlisting the help of several authoritative sources like the National Numbering Agencies and data vendors, says Janssens, but all of these commercial organisations will have to work together. Similarly the framework will have to be implemented internationally if it is to be truly successful, meaning that all of the different jurisdictions will have to cooperate. There will also be some philosophical and political opposition from the industry. Nassim Nicholas Taleb, author of ‘The Black Swan’, a book which highlighted the inability of established risk management measures to foresee unpredictable or ‘black swan’ events, has likened the OFR to “an omniscient Soviet-style central risk manager”. Speaking at a roundtable event organised by the OFR he suggested that such a macro-prudential facility could breed overconfidence in the market’s ability to foresee unpredictable events, causing a “reliance on sterile data” and therefore increasing systemic risk. Other industry experts are more focused on the OFR’s ability to deal with the aftermath of a bank default rather than predicting it. “It is something that needs to be done - not because I’m confident that it will prevent the next crisis but if we develop the will to let an institution fail, then we have to have a plan,” says David Rowe, founder of David M Rowe Risk Advisory. “What the industry cannot afford is a repeat of the Lehman default where slow moving bankruptcy proceedings mean that creditors are left hanging for months and even years before receiving a settlement of their claims.” The OFR also plans to establish a reporting standard for derivatives – something that the industry has not been able to accomplish on its own, says Rowe. “Previous attempts at developing
an electronic reporting standard, such as Financial products Markup Language (FpML), have had to fight an uphill battle because no one could be quite sure how successful they would become. If everybody knows that everybody else will have to conform to a regulator mandated standard, there are some tremendous efficiency gains available to the market. Among other things, such a standard would greatly increase the share of trades that could be reconciled and confirmed electronically, reducing the staff cost of manual reconciliation.” Ensuring successful standards is another potential benefit that could come from the OFR’s initiative. There have been numerous attempts in the last 20 years to develop a system of legal identifiers, starting with the International Business Entity Identifiers (IBEI) project back in the 1980s. But it has taken the involvement of regulators for the industry to get anywhere near a conclusion. Nevertheless there is still someway to go before the various projects are complete, and inevitably there will be some wrangling over the cost of the work involved and who should pay for it. But there is also an understanding that the industry cannot go on as it has, says Janssens. “Nobody wants to experience another Lehmans and to be as exposed again.” Janssens also says that the LEI solution is based on a ‘cost recovery’ model. And he stresses that the LEI project and the building of a repository that tracks all transactions does have an obvious business benefit beyond the regulatory aspect involved. “It will enable firms to monitor exposure and risk for their own purpose.” Similarly, says Janssens, the various data vendors in the industry all understand that the project is in the interest of the industry and that the model is based on cost recovery. “The data will be made publicly available and they will all be able to build the LEI into their existing offerings,” he says. One of the data vendors that will be looking to build the LEI into its various offerings is Thomson Reuters. “In some ways the LEI project will commoditise the core legal entity record by making data a utility but, having common identifiers and standard symbols will be good for the industry,” says Tim Lind, global head of strategy and business development,
enterprise content at Thomson Reuters. “It will be a linchpin that will synchronise databases and link risk information in a way that has not been possible.” For market data vendors it will also create new opportunities, says Lind. “We are basically mapping the financial genome. Understanding the complexity of global corporate structures and the hierarchy of connections between entities and the securities they issue is the kind of valueadded content that the LEI can provide. It will enable firms to take a broader perspective on risk, particularly in assessing the creditworthiness of an entity because it creates an indelible link between the valuations process and other information such as news, corporate actions, supply
chain risk and even regulatory sanctions.” Despite the potential benefit of the OFR’s LEI, Lind says that the industry must be wary of relying too much on regulators to address gaps in risk management. “The post-crisis mentality has focused too much on government intervention and bail-outs. Accountability to shareholders and clients, along with an obsession with fiduciary responsibility will create an effective approach to risk. We should embrace opportunities such as the LEI because it will improve the industry’s ability to protect capital, not just because regulators demand it.” Utilities will not solve all of the industry’s ills, but will provide the initial impetus that seldom arrives when the industry is left to self-regulate and ends up with fragmented or proprietary solutions. And once the foundations of that industry utility are laid, it will be up to individual institutions to build their own capability on top of that, says Lind. “There is a lot of capital involved in setting up the LEI so this is a
“The post-crisis mentality has focused too much on government intervention and bail-outs.”
way of mutualising the capital and risk, but also leaving enough flexibility for firms to develop their own competitive advantage by using the LEIs as a way of linking different risk information.” How the OFR itself will use the information it will hold remains one of the many open topics within the Dodd-Frank act and the industry as a whole, says Patrick Amon, risk specialist, Adaptiv, SunGard. “The agency can become a rich source of information for academic work, particular in financial economics, but how this data will be generated, transmitted, secured, anonymised, and treated remains unclear.” The OFR should nonetheless be considered a powerful tool even if it is unclear how this tool will be used and unclear as to how effective it will be in its stated aim to reduce systemic risk, says Amon. “It is likely to have a substantial impact on future risk technology and also on risk governance as the new technology is deployed to support this new, broad mandate. The impact of the OFR at both a micro and macro prudential level should not be underestimated.”
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Working in the
dark Although the wind of change is continuing to blow through the financial services, the future regulatory and technological landscape remains uncertain. Sherree DeCovny investigates the data management, reporting and connectivity challenges firms will potentially face.
Regulators worldwide have been hard at work trying to close the gaps that led to the financial crisis and refine existing rules as part of a routine review process. Many financial institutions will have to comply with Basel III and the Dodd-Frank Wall Street Reform and Consumer Protection Act, which comprises some 350 rules and is the most extensive financial regulation since the Great Depression. Across the pond, Europe is undergoing a second wave of reform with Markets in Financial Instruments Directive (MiFID) II, the European Market Infrastructure Regulation (EMIR) and the Market 12
Abuse Directive (MAD). The industry is overwhelmed by the changes that lie ahead and the impact they will have on technology. It is clear that financial institutions will have to navigate several regulatory spheres depending upon the segments and jurisdictions they operate within. Though governments have committed to the guidelines and deliverables the G20 set for 2012, the rules have not been finalised, so uncertainty is at an all time high and technology developments can only progress so far. â€œCertainly in my career, this is the most significant change Iâ€™ve ever seen, and to
do it in the time frame that’s required is a challenge,” says Jim Rucker, chief operations credit and risk officer at MarketAxess. “But I think once we get through that, we are going to end up with a sounder derivatives market, which ultimately will benefit market participants.” The regulators are focusing on enterprisewide exposures, Tier 1 capital ratios and risk weighted assets (RWA). The Tier 1 capital ratio is the ratio of a financial institution’s core equity capital to its total RWA. Riskweighted assets are the total of all assets held by the bank weighted by credit risk according to a formula determined by the regulator. In short, financial institutions now need more capital, better quality collateral and liquidity buffers. They must be able to mine all their books to net exposures and optimise the calculation of RWA. Pre-and post-trade analytics has moved into the limelight. Risk management, surveillance and credit checks used to be done at the end of the day, the next day, a couple of days later or at several points throughout the day. The new rules require checks to be done pre-trade. The initial burden falls on the broker-dealers, but they will have to cooperate with other internal and external stakeholders along the chain. The information that needs to be provided is not limited to any single trading platform, asset class, or exchange as pre-trade checks need to be done on an aggregated basis across a client’s activity. Centralised clearing (CC) will have a massive impact on the industry. In bilateral agreements, financial institutions know their counterparty, and they hold capital against the risk of a counterparty default until the maturity of the contract. In CC there are no capital requirements because counterparties put up margins with the central counterparty. In the future, the counterparty will have to pass several credit checks before the clearing agent will send a final confirmation and clear the derivatives trade. This represents a significant change in workflow. Previously, a deal confirmation was sent, then it could take a week or two to reconcile the collateral and pass the credit check before sending the final confirmation. All this processing was done between the back offices of the two counterparties. There is a huge incentive to accelerate trade processing because the regulators will look
unfavourably on unsettled over-the-counter (OTC) trades. The speed at which firms can aggregate their collateral, calculate their counterparty risk, settle the trade and transfer the security will be critical. “The clock is ticking, and the longer this takes, the more capital you need,” says Philippe Carrel, global head of governance, risk and compliance advisory solutions at Thomson Reuters. “Nobody is structured for that.” Financial institutions will need robust calculation engines. Under Basel II, financial institutions must calculate loss given default, which is the loss they would incur if a client defaulted on a contract. In addition, they have to apply a credit conversion factor ratio determining the exposure at default. Under Basel III, they will also have to calculate and reserve for stressed Value at Risk (VAR) and wrong way risk. Wrong way risk occurs when exposure to a counterparty is adversely correlated with the credit quality of that counterparty. In addition, the counterparty credit risk regime has been changed to increase the capital charges associated with bank OTC derivatives and securities financing transactions. Financial institutions will have to calculate the market value of counterparty credit risk, known as a Credit Value Adjustment (CVA). A CVA is a VAR calculation done monthly for 30 years into the future, so essentially it is 360 VAR calculations at once.
demands, some financial institutions will be leveraging cloud computing. They are taking order and execution data from many end points, assimilating and normalising it, and making it available in real time. A real-time data cloud makes it easier and faster to share information, and it is less expensive to implement than a full systems integration. Systems will need to be consolidated. Even before the credit crisis, financial institutions started rationalising their systems, especially the ones used for posttrade processing. The more systems they have, the more difficult it is to integrate and reconcile numbers. “The new regulations if anything are putting more pressure on them to do that,” says David Dixon, solutions manager at Misys. “The fewer systems you’ve got, whatever the regulations are, the fewer systems you’ve got to change to match them.” Workflows will have to be re-defined to reflect a common understanding of the trade lifecycle and specific terms pertaining to transactions. Currently, market participants understand a trade lifecycle at individual entities such as the Depository Trust and Clearing Corporation (DTCC), MarkitServ, LCH and Chicago Mercantile Exchange (CME). Clarification will be necessary in order to report transactions to trade repositories. Standards will need to be chosen to facilitate communications between the various stakeholders.
“CVA was something the banks were doing once a week not more than 18 months ago, just because of the sheer volume of the simulations and calculations that must be performed,” says Allen Whipple, managing director at Quartet FS. “The calculation complexity was too much to re-do that on a trade-by-trade basis.”
It is likely that Financial products Markup Language (FpML) will be used as the standard for data transmission. One drawback is that FpML describes some trade types, but it does not cover some of the exotic ones. Further, some firms will have to climb a steep learning curve to implement it.
Firms will need top-notch capabilities for data management, reporting and connectivity. More data on each trade needs to be stored, and it needs to be properly managed, audited and redistributed. In line with the G20 recommendations on OTC derivatives, trade data needs to be reported to an array of stakeholders including exchanges and other trading venues, clearinghouses, clearing agents, custodians, trade repositories and regulators.
“Smaller stakeholders are not so familiar with FpML,” says Veronique Malbos, solution manager at Misys. “They don’t have the framework in place to push information in real time. They are still dealing with flat files, File Transfer Protocol [FTP] transfers, emails and Excel spreadsheets to reconcile their positions.”
To cope with the data management
Trading venues will need to make changes to their platforms. For instance, MarketAxess plans to register its platform as a swaps execution facility (SEF) to trade credit default swaps (CDSs). To this end, 13
it has been working on many changes necessary to comply with Dodd-Frank and the European regulations. Some core changes have been made to the trading protocols and functionality. Notably, it has introduced streaming prices to improve transparency, which is different to the way CDSs have traded over the platform. “Traditionally, the way that CDSs and most of the products on our platform have traded is on a request for quote basis,” says Rucker. “This streaming price protocol is new for us and an important change that goes quite a long way towards meeting some of the requirements of Dodd-Frank.” RBS and Credit Suisse are already live on the streaming price protocol, and MarketAxcess anticipates that several other banks will join in the near future. 14
MarketAxess has also been working on connectivity to the clearinghouses. On the trading screen, customers can select whether the trade is to be cleared or not. If it is to be cleared, they can select the clearinghouse and the Futures Commission Merchant (FCM) that will represent them. Full application programming interface (API) connectivity with the CME and Intercontinental Exchange (ICE) will be available in the third quarter of 2011. Similarly, it plans to connect and deliver trades to the DTCC’s swaps data repository (SDR) once the DTCC releases the specifications for message delivery. The DTCC already has a CDS trade information warehouse, but the SDR as determined under Dodd-Frank is not set up yet. In fact, at this point no one can actually register as an SDR. MarketAxess has been upgrading the
functionality for more complex transactions. Customers can now do switches and rolls for indexes and single name contracts electronically. Swap execution facilities (SEFs) will have new compliance and supervisory responsibilities to prevent market abuse and manipulation, so MarketAxess has been working on that as well. “We think we’re a large part of the way there, and there are even some things that we’ve done behind the scenes that are currently live but give us the capability to quickly implement some changes,” says Rucker. “There would have to be something coming out of left field for it to cause us a problem.” Market participants expect many of the rules in the US and Europe to be finalised in the fourth quarter of 2011. In the meantime, market participants will continue working in the dark.
Industry insight is one of the main reasons many attendees come to Sibos every year. Four speakers at this year’s event reveal their thoughts to Jim Ottewill on the burning issues of debate in Toronto. Mark Gem, head of business management at Clearstream Banking and a member of the executive management
have to report their obligations and have opportunities to clear and collateralise obligations. It may be a little bit glib to say, but to a degree there are people out there who are only dimly aware that these are even main issues.
The big issues this year are the three Cs - compliance, capital and collateral - which show how the industry has moved away from the subdued mood after the Lehman crash. The focus has progressed from efficiency and cost reduction to a more safetydriven agenda, where the regulators have remained very engaged.
It is the same thing with infrastructure projects tied into the securities industry. The community represented at Sibos is probably looking to master these sorts of topics - but how will their clients and the markets they serve cope? How can firms attending Sibos develop strategies to help their clients adjust to and master the changes? These issues are only really emerging now.
It is all about understanding, coping with and mastering regulation in the sense of compliance, but above all figuring out ways to develop a business strategy for the new regulatory environment, which will be the key theme at Sibos. The industry is still at the digestion point - whether it's with Basel III, Dodd-Frank or the European Market Infrastructure Regulation (EMIR) - and those on the narrow cusp of the securities services industry are beginning to get to grips with these regulations. But many of our clients - that is to say those in the next leg of the value chain - are only recently coming to terms with the scope of changes to come. Most people involved in derivatives reporting or clearing, such as asset managers at large corporates or pension and insurance funds, do not yet know how hard EMIR or Dodd Frank will hit them. They will
It is these themes which should be on the key agenda at Sibos. My panel is entitled 'How to turn threats into opportunities' coming specifically out of regulation and that title is emblematic of where the industry is now. The industry has moved from denial, through to acceptance and is now seeking to master this new world. We're very much on the cusp of that transition. Capital and collateral are probably two of the key themes when you start thinking about turning threat into opportunity. I think a lot will be said about how the securities services industry, which has largely been about efficient processing, will continue to be about efficient processing in the future. Mark Gem is speaking in the Securities regulation stream: ‘How to turn threats into opportunities’ (Wednesday 21 September 09:30 – 10:30) Conference room 3.
Michael Bodson, chief operating officer, Depository Trust and Clearing Corporation (DTCC) The frenzy and frenetic nature of the re-regulation that’s taken place since the last Sibos event has shifted to understanding the totality of what has to be achieved by both the regulators and market participants. However, I don’t think there is going to be a lessening in the overall levels of re-regulation. But there is now an acknowledgement that trying to get it all done within a year is implausible. Hopefully the result will be a more pragmatic approach to the issues.
As with last year’s Sibos, there is still going to be so much discussion surrounding numerous regulations - but the Basel III regulatory framework is perhaps going to be the biggest talking point for the transaction banking industry in Toronto. How will the new regulatory demands of Basel sit within existing frameworks and jurisdictions? The increased complexity of this revised set of prudential recommendations poses in itself a risk and currently many details remain open for interpretation.
When I spoke at Sibos last year, I said the industry has to look beyond the words of regulators to the intent of the new regulations. It’s important that market participants understand what the regulators are attempting to accomplish with reregulation and the underlying problems they are addressing. It is only after you have had this dialogue that you can come up with a pragmatic response. If you are essentially creating a new regulatory regime in such a short period of time, then the unintended consequences are one of the biggest causes for concern, along with the lack of consistency across regulatory regimes on a global basis.
At the same time the actual legal implementation of Basel III risks happen to different degrees and at different timetables depending on the countries involved. Already today there is a significant gap between local Basel standards of key countries such as the US, China and the EU. This makes it particularly challenging for international banks, which tend to favour a more harmonised environment and level playing-field.
A major theme at this year’s Sibos - and an issue the industry will struggle with over the next year - is the need for a sense of clarity and certainty. In other words, what changes do firms need to make to operating models, how do they change and how do they regain capital efficiency?
As ever, the debate surrounding the Single Euro Payments Area (SEPA) will continue to be a concern. With the EU SEPA migration regulation in its final negotiation phase, a specific date for the change over from national euro credit transfers and direct debits in the retail payments space to the SEPA standards is now looking to be within reach. There is however a concern as to whether the result of legislation and industry standardisation efforts will really bring about the market integration and crossborder competition that SEPA promises. If SEPA migration results in a large-scale move from local formats and standards to the ISO 20022 XML, while at the same time introducing national variations, SEPA will not have achieved its key objective of harmonisation. Only true harmonisation will finally create competition between banks and hence bring about reduced cost and improved services for consumers as well as businesses.
This is a business that prides itself on a high return on investment (ROI) - and it has definitely gone through a stage where this has been impacted. At Sibos, we’ll have some of the brightest minds in the industry debating these issues, and they will come up with new ways of gaining capital efficiency and taking it to the next level. So, hopefully, 2011 will be the year of pragmatism in which we see more things coming to fruition and gain a better understanding of how to manage this period of transformation. The industry now understands that the risks that need to be controlled are both those within standard deviations and those of a fat tail nature. It now requires a whole different mindset to analyse and address the variety of forms that risk takes. Michael Bodson is speaking at Big Issue Debate 1: The post-crisis financial transaction infrastructure: what will it look like, and what do the changes mean for market participants? (Tuesday 20 September 11:00 – 12:30) Plenary room.
Ruth Wandhöfer, head of regulatory and market strategy EMEA, director, Citi Global Transaction Services
Much of the industry discussion at Sibos will focus on filtering out some of the key challenges Basel III will pose to different types of transaction services such as trade, custody and payment services, including the broader area of correspondent banking.
On the securities side, T2S remains a key topic with further regulatory initiatives at EU level added to the discussion - for example upcoming legislation around CSDs, the potential harmonisation of securities law and of course the ongoing negotiation of the EU Regulation of OTC derivatives clearing and CCPs. Sibos week promises to be very interesting... Ruth Wandhöfer is speaking at ‘Managing global regulatory complexity: a partnership approach’, (Monday 19 September 16:00 - 17:00) Community room 1; and in ‘The Executive Payments Forum Debate’ (Wednesday 21 September 15:00 - 16:00) Community room 4.
Kah Chye Tan, global trade finance and working capital, Barclays Corporate Basel has obviously been a headline for the last couple of years and will continue to be so at this year’s Sibos. Another area of discussion is very much in the space of cooperation within the payments side of the banking industry - if you look back over the past five years, corporate cash management has picked up momentum in this area. But I think trade finance is lagging behind.
“The Basel III regulatory framework is perhaps going to be the biggest talking point for the transaction banking industry in Toronto.”
There is a lot the industry could do to work together in this area for the greater good of everybody, particularly the client. However, it will require a lot of cooperation between banks and also leadership by organisations such as SWIFT to help to bring this bunch of competitive banks together and ensure they are willing to help each other. The mood at Sibos will very much depend on what happens in the US and the EU markets. No one is expecting a nose dive into recession but there is an outside chance we will see a significant increase in price for trade. A lot of people believe this is a shortterm problem but I think there is an outside chance this could turn into a longer term cause for concern. On a positive note, the regulators are listening to feedback which is coming from the industry. Some of the changes proposed by the EU are definitely a reflection of the messages they are hearing. So we should acknowledge the regulators and give some credit for this rather than criticising them - they have been very good over the past two years and the changes proposed by the EU are really a reflection of their ability to listen. Having said that, it is not the end of the regulatory road and there is still a long journey left to travel on the path of getting the right policy. For this to succeed, the industry needs to continue with the dialogue and regulators need to continue listening. Kah Chye Tan is speaking at ‘Regulation - How Basel III Impacts Trade Finance and the World Economy’ (Tuesday 20 September 14:00 - 15:00) Conference room 2.
at sibos 2011 Stand J113
Visit the Murex stand to attend our business sessions or request a demo, and meet with our team of experts.
Discover Murex's MX.3 Cross-Asset Back Office Solution, Your Enterprise Platform for Optimised Efficiency and Boosted Performances. Find out how Murex can support your business strategy: * Participate to our business sessions (Transaction Factory, Collateral & Enterprise Risk Management, Clearing, etc...) * Attend a MX.3 Demo * Arrange a private meeting to discuss your business needs. For further information, visit the Murex@Sibos website (www.murex.com/sibos) or contact us at firstname.lastname@example.org
Murex Benefiting from over 25 years of successful presence in capital markets, Murex has developed an unmatched competence in the design and implementation of integrated trading, risk management, processing and clearing solutions for buy-and sell-side financial institutions, corporations and utilities located across the globe. Every day over 36,000 users from banks, hedge funds, asset management companies, corporations and utilities rely on Murex people and Murex solutions to support their capital markets activities. Client satisfaction is our primary goal, from quality and rapid development to successful implementation and high-quality support. Our 200 worldwide clients can rely on over 1,400 specialists actively focused on delivering 24-hour global support through our offices in Paris, New York, Singapore, Dublin, Beirut, Beijing, São Paulo, Sydney and Tokyo. Built on an innovative multi-business, multi-entity architecture, Murex’s MX.3 provides a comprehensive enterpriseback office solution. Trade management functionalities include payments, settlements, confirmations, matching, client services, nostro management and accounting. The powerful workflow engine adapts to any industry processes and enables highlevel automation. Native integration with our enterprise-wide risk management and clearing specialised solutions (Futures Clearing Merchant (FCM) and client clearing) make MX.3 the reliable choice for ambitious business objectives in an evolving regulatory environment. The MXpress implementation methodology leverages the wealth of business content accumulated by Murex over two decades through pre-packaged components of the platform, while offering an accelerated process of delivery. From a standardised ready-to-go solution, through user-friendly configuration, to client-specific extension through development, Murex has a market-leading deployment solution.
Key Features: • Market-differentiating asset class coverage: ranging from cash and listed products to over-the-counter (OTC) derivatives and including structured products.
• Advanced straight-through processing (STP) capabilities: powerful workflow framework covering full lifecycle management and exception handling.
• Streamlined back office processes including position management, trade confirmation, settlement, cash transfers, corporate actions processing, reporting, auditing and event processing.
• Pre-packaged clearing workflows.
• Powerful client organisation: multi-entity, multiproduct and multi-currency. • Consolidated view for real-time monitoring and control of processing operations across asset classes, desks and entities.
• Full collateral and margining management across asset classes compliant with latest regulatory requirements. •S eamless integration and connectivity: integration to other front/middle platforms and third parties (exchanges, clearing houses, matching platforms, custodians, etc) and extension capabilities for custom-built interfaces.
Virtual banking in the real world of international cash management Tim Nash, payments and liquidity consultant at The SEPA Consultancy, examines how virtual banking can offer corporates an alternative remedy to international cash management headaches. Several banks have had success in generating new income streams and, perhaps more importantly, significant new balances, by providing virtual banking (VB) propositions to client segments such as fund managers and law firms which hold third-party funds. The same VB approach can also be used to support international cash management (ICM) propositions for large corporate clients, although the benefits from such an approach mean more for the client than the bank. The example below shows how the ICM requirements of a corporate (UK Co) can be met by either a traditional solution 20
or by VB - an alternative which can have advantages in terms of cost and ease of operation for the client.
What is virtual banking? Traditionally, the only way to keep separate the cash movements in and out of the various units, divisions and subsidiaries of a corporate entity, was by each opening and operating its own (‘physical’) bank accounts. However, this multitude of bank accounts is expensive for the bank and corporate to administer. A, perhaps conservative, market estimate is that every bank account costs a corporate
approximately £800 per year for maintenance, reconciliation and auditing. VB, which operates in a real-time connection with the corporate’s enterprise resource planning (ERP) system, enables a different model whereby the number of physical bank accounts is minimised, as these accounts are only required to provide access for payments to and from the corporate’s VB environment. The corporate manages the cash flows of its divisions and subsidiaries in real time using bank-active virtual accounts, which it opens as required. The VB system synchronises the virtual accounts, the physical bank accounts and the bank system connections in real time,
funds back to the mirror UK accounts overseas; or
Figure 1: Standard ICM Solution
• Tops (MT103) to return overdrawn accounts to a positive position by a payment from the UK mirror account. UK Co and its overseas operations/ subsidiaries use the in-country, localcurrency accounts to handle their day-to-day payments and receipts. Then as required by UK Co’s treasury department, the balances on the individual in-country accounts are consolidated into the company’s UK cash pools. In order to comply with accounting/tax rules, UK Co buys UK Bank’s Interest Apportionment Service (IAS) to enable them to demonstrate the application of ‘arms length’ interest rates to the accounts within each notional pool.
Source: The SEPA Consultancy
which enables the virtual accounts to be bank active.
• Three EUR accounts in Frankfurt with German Bank.
This VB approach is the reverse of the traditional ICM approach, for example:
• Four USD accounts in New York with US Bank.
• ‘Many to one’ - the traditional solution combines the balances on many physical bank accounts into a single position for the corporate at the bank providing the cash pooling service.
• Three SGD accounts in Singapore with Singapore Bank.
• ‘One to many’ - the VB approach allows a single physical account to support the operations of many virtual accounts managed and controlled by the corporate itself.
Standard ICM solution
UK Bank is the primary banker for UK Co. In addition to its operations in the UK (for which it has 10 GBP accounts at a London branch of UK Bank), the company has trading connections with Germany, USA and Singapore. To support its overseas activities the traditional ICM model requires the company to open (physical) accounts with banks in the countries concerned, or with the in-country branches of UK Bank. Hence the company will have: • Ten GBP accounts in London with UK Bank.
In order to benefit from the natural set-off between the debit and credit balances on their in-country accounts and improve management control and visibility over them, UK Co agrees to take the standard ICM offering of UK Bank. This SWIFT-based ICM solution involves the consolidation into UKbased cash pools of the balances on the company’s overseas accounts. To avoid the complexities of co-mingling funds, UK Co decides that their UK cash pool structure should feature mirror accounts for each overseas account, which UK Bank agree to notionally pool. As set-out in the Standard ICM Solutions (Figure 1), UK Bank’s ICM system receives the balances on UK Co’s overseas accounts by SWIFT MT940/MT942 messages and then uses pre-defined target balance rules to generate either: • Sweeps (MT101) to repatriate surplus
Although if operated correctly, UK Co should benefit from its ICM facility, there are significant costs involved in its operation - e.g. maintaining 20 bank accounts (approximately £16,000) plus the ICM charges of UK Bank (fees for sweeping, topping, IAS, maintenance, preparation of supporting legal documentation such as cross-guarantees, etc). In addition to these ongoing costs, should UK Co want to add accounts to its ICM arrangement then it will experience the full complexity and delays (e.g. KYC) associated with opening new bank accounts. Now let’s consider how an approach based on VB would achieve provide a similar ICM service for UK Co.
Alternative virtual bankingbased ICM solution
UK Co are an innovative company, keen to gain the benefits from the latest developments in banking technology, hence they sign-up for UK Bank’s VB service. This facility provides the company with an in-house bank capability enabling them to open and manage virtual accounts as they require. The in-house bank connects to the outside world by a single bank account for each currency in which UK Co wishes to transact business. As in the first example, the company is UK based and has trading connections with Germany, USA and Singapore, hence it opens a single, physical account with a bank in each country. It then uses its
“Early notice of significant credit and debit positions enables the company to take the appropriate action that day rather than the following day ” Figure 2: VB-based ICM Solution
‘arms length’ rates in accordance with UK Co’s accounting policies. The use of a direct FTP feed between the physical account and the VB system allows UK Co to monitor its currency positions in real/near time enhancing the benefit derived from its ICM facility. Early notice of significant credit and debit positions enables the company to take the appropriate action that day rather than the following day as with some traditional SWIFT MT940based services. Additionally, VB platforms can include sophisticated predictive cash forecasting functionality. By retaining details of all transactions passed across each virtual account over time - many of which are likely to be repeat items - the system is able to estimate the expected balance on each account at any time and report automatically any significant variances for investigation. The VB-based ICM facility can also bring other advantages to UK Co: • A significant reduction in its account maintenance charges (i.e. from 20 accounts in the traditional model to only four using VB).
Source: The SEPA Consultancy VB platform to open virtual accounts to support its trading operations in each country, for example: • Ten GBP accounts. • Three EUR accounts. • Four USD accounts. • Three SGD accounts. The VB system links these virtual accounts set-up inside UK Co with a single, physical bank account for each currency automatically. All the payments and receipts of UK Co’s units, divisions and subsidiaries in the currency concerned will pass through the single physical bank account, irrespective of which virtual account they relate to. The system takes real/near-time feeds of information from the physical bank account and applies the entries concerned to the appropriate virtual account with full supporting transaction details. These data feeds are transmitted over a highly secure File Transfer Protocol (FTP) link. 22
The process is set-out in the VB-based ICM Solution (Figure 2), the physical accounts are shaded in pink and the virtual accounts in green. Unlike the previous diagram in which UK Bank were in control, in this VB-based example UK Co itself manages and controls its ICM facilities. The balance on the single bank account in each currency benefits from the natural set-off between the debit and credit payment flow across it provided by all UK Co’s operations in that currency. The accounting/ERP system of each unit or subsidiary of UK Co is linked to the appropriate virtual account to allow the various cash flows to be reconciled. In order to meet the needs of accountants, auditors and tax authorities, the VB system produces full statements and interest calculation reports (‘interest ladders’) on each virtual account. This allows the interest earned/paid on the physical account in each country to be apportioned across the virtual accounts at
• Reductions in the ongoing ICM fees sweeping, topping, maintenance, ICM, etc (although UK Bank will charge a fee for providing its VB platform to the company). • The ability to open and operate new virtual accounts immediately as required by its trading activities, rather than suffer the delays and paperwork associated with opening new bank accounts. • As required, the ability to mirror the functionality of the traditional ICM approach, as the VB platform can generate sweeping and topping messages to the bank holding the physical account, over the FTP link using instructions formatted as per the related SWIFT instructions (MT101/103). Clearly before adopting the cash pooling/ ICM arrangements of a bank, the company concerned must seek advice and approval from its accountants, tax advisors and lawyers and a VB-based solution is no different. However, in appropriate circumstances, a virtual ICM solution can offer significant advantages over the traditional approach.
New SWIFT white paper outlines key requirements for regulatory success
Collaborative solutions and standards-based approaches are needed to minimise total cost of ownership (TCO) of compliance, say experts New regulation is coming to the securities markets. That much is certain, but what is less clear is its exact impact, implementation and application. In this context, SWIFT experts say financial institutions can take better control over their own destiny by working together to develop operational solutions that address important aspects of the regulatory agenda. This conclusion is part of a SWIFT white paper entitled ‘Facing the unknown: building a strategy for regulatory compliance in an uncertain landscape’. Regulators have made clear that new rules are coming, but a lack of clarity exists regarding what the new guidelines will cover, their long-term impact on financial institutions, and the cost and effort required for compliance. “This uncertainty is an inevitable consequence of an unprecedented attempt to coordinate an ambitious series of regulatory measures across all major markets - impacting everything from the capital structure of banks to the clearing and reporting of derivatives,” the paper states. “While there is no way of avoiding either the regulations that are coming or the consequences of this uncertainty around the application and implementation of new regulation during the next few years, you can take more of your destiny into your own hands by supporting collaborative approaches to developing operational solutions to address important aspects of the regulatory agenda.”
Working together to take control
In this context, taking a collaborative approach to finding acceptable regulatory solutions is an important way to regain some control of the situation, explains Fabian Vandenreydt, head of securities and treasury markets at SWIFT. “Presenting to the regulators, alongside your peers, operational solutions that work for both regulators and for you and your fellow institutions is a better way of moving forward than either just waiting for something to be imposed or burying your head in the sand and hoping it will all go away,” says Vandenreydt. The white paper offers guidance for financial institutions grappling with regulatory uncertainty - it recommends that firms monitor the situation, take a stance on how proactive they will be in shaping the regulation and make a plan for compliance based on what they know.
While regulatory changes are unavoidable, the white paper argues that you need to explore collaborative solutions with your peers to address key regulatory challenges - in particular, to exploit open, flexible, standards-based solutions, to ensure you can reduce the TCO of your regulatory response, while achieving your compliance goals in the most efficient way possible. One activity set to be particularly affected by new regulation
is clearing, and this implies changes for central counterparties (CCPs). Commenting in the white paper, Diana Chan, CEO of EuroCCP, says: “Regulators want CCPs to clear more and, at the same time, are raising the bar significantly on all aspects of their operation. The cost of compliance with new regulatory requirements will be significant. Collaboration within the clearing industry to develop standards to face these new challenges is more important than ever before. “Standardisation of message formats, communication protocol and operational procedures among connected parties reduces long-term costs and operational risks for everyone. The sooner we accomplish this, the better. We must not miss the opportunity to do it right from the start,” she says. Vandenreydt adds: “For years, SWIFT has worked with the industry to deliver standards-based solutions that have increased operational efficiency and reduced compliance TCO. Now, we look forward to collaborating with other industry stakeholders to proactively address the common challenges of compliance with the new regulations while helping our customers manage risk and cost in the most effective and strategic way possible.” Download the white paper ‘Facing the unknown: Building a strategy for regulatory compliance in an uncertain landscape’ from www.swift.com. The aim of the G20 was to achieve a harmonised approach to regulatory change post the financial crisis: in reality the picture is far from uniform. It is not clear which firms will have to comply with what, by when, in which markets. You need to monitor the situation, take a stance on how proactive you will be in shaping the regulation and make a plan for compliance based on what you do know. Standard, open, flexible solutions are essential to reduce the TCO of compliance efforts. There is an opportunity to develop collaborative solutions to minimise industry-wide impact of regulatory change.
Join the regulatory debate at Sibos 2011 in Toronto from 19 - 23 September Securities regulation: How to turn threats into opportunities Wednesday 21 September 09:30 - 10:30 Conference room 3 Markets around the world are introducing new securities legislation in response to the financial crisis, but how far has the process progressed in implementation terms? Where are the gaps, and where is coordination lacking? What is the optimal approach to keep on top of regulatory change, to comply with emerging requirements in an integrated way, and to capitalise on new regulation as a spur to business growth?
Collaborating to conquer common challenges Wim Raymaekers, head of banking market at SWIFT, sees the spirit of collaboration as a way for financial institutions to overcome regulatory and technological challenges A trio of critical factors - technology, innovation and regulation - are having a significant impact on the payments industry today. These factors - all set to be the subject of in-depth discussion and debate during Sibos 2011 - are also exerting pressure on the banks and forcing them to take action to secure their roles as leaders in the payments business of the future. Banks are facing competitive challenges from non-bank players empowered by new technologies. These challengers are stealing a march on traditional bank providers in a number of areas, especially in faster person-to-person (P2P) and mobile payments. On the other hand, traditional cross-border bank payments still often take several days, with very little visibility on flows in transit and when the receiver actually gets the money. For how long can the existing correspondent banking model survive? Should banks take the lead in a profound redesign? At the same time banks must also cope with new regulation in the wake of the financial crisis - which makes it harder to focus resources on such innovation. The logical answer is for banks to collaborate and take collective action to address common challenges. By deploying standardisation and pursuing the creation of collaborative industry solutions, financial institutions can maximise the value of emerging technologies in order to innovate successfully and comply efficiently with new regulation. If they collaborate, banks can retain their central role in the payments business of the future. 24
Liquidity management: collaboration in action
One of the most critical pieces of new regulation with which the banks must grapple is Basel III. As is now well-recognised, the failure of a number of leading banks in 2008 highlighted serious inadequacies in funding and liquidity risk management. The result is regulation that could cost firms hundreds of millions of euros in additional funding costs during the next five to 10 years - and require them to transform their approaches to liquidity risk management. Since the financial crisis, the banks have increased their liquidity reserves in order to protect themselves against the impact of similar liquidity crises in the future. However, Basel III is putting more rigour and process around liquidity management practices. As is discussed extensively in a new white paper from SWIFT - entitled ‘Managing liquidity risk: Collaborative solutions to improve position management and analytics’ - Basel III puts in place quantitative standards around the size of these reserves. It also imposes rules on the liquidity value attributed to different classes of assets and liabilities. In addition, the new framework includes qualitative standards that will push firms to improve the governance and control frameworks around the management of liquidity. Banks will also need to improve the management and control of liquidity across various dimensions including the management of cross-currency risk, intra-group liquidity
flows between legal entities and - crucially - the processes and controls around the intraday management of liquidity.
Good news, bad news
Technology solutions have a vital role to play in helping the banks to improve their liquidity management activities. And the good news is the way in which they can do this is well-understood. As the 2010 SWIFT liquidity risk management survey concluded, effective liquidity risk management requires a top-down and bottom-up approach. The strategy, principles and objectives need to be set at management and board level. Then a liquidity ‘dashboard’ and analytics need to be created, powered by data obtained at the operational level. The bad news is that, as SWIFT’s 2011 survey on the same topic shows, there are data management issues holding up progress in addressing liquidity risk - and these issues have not yet been solved. SWIFT’s survey of 40 cash, liquidity and liquidity risk managers at financial institutions around the world identified six key areas in which data management needs to improve, to create: • A view on intraday cash position across currencies (identified by 93 per cent of respondents). • Ready-made liquidity risk analytics and business intelligence (91 per cent ).
• Advanced interactive cash and collateral management functionalities within payments infrastructures (89 per cent ). • An ability to build predictive positions (88 per cent ). • An intraday view of unencumbered collateral positions including margin calls (88 per cent ). • An ability to manage and report liquidity positions at a firm-wide level (82 per cent ). Managing liquidity risk is a complex process that involves having the right monitoring and controls in place, as well as quantitative measures and reporting. Until the right data is readily available at the right time, progress will be difficult. All banks need to perform better in the area of liquidity risk management: which means that this is a prime area in which collaboration has to be the best way forward.
• A standard margin call solution to support the implementation of intraday feeds in liquidity management applications. • Industry best practice for collateral reporting for liquidity management purposes. • A central ‘payment tracker/adviser’ platform providing transactional status.
The benefits go beyond regulatory compliance
Where can the banks collaborate?
While regulation is a leading driver, the business case to invest in liquidity management goes beyond regulatory compliance and risk mitigation. Getting it right can save the banks a lot of money too - money that then becomes available for reinvestment in innovative new products and services to bolster their positioning in today’s competitive environment.
The collaborative developments they identify are:
Where there is a lack of intraday data, there can be late identification of gaps between forecast and real inflows, outflows and positions. These result in substantial financial costs - due to over-collateralisation, intraday credit line costs, higher funding costs, overdraft charges and higher liquidity buffers.
• Industry best practice for intraday cash reporting.
Collaborative solutions that effectively address these shortcomings will deliver real savings to
• Common reporting standards and liquidity
the banking industry.
The respondents to the SWIFT liquidity risk management survey agree that collaboration is needed and is achievable. They identify five top-priority collaborative developments that will address the data management issues that are holding up progress - some of which could be implemented in a relatively short timeframe.
monitoring and control standards for use across high-value payments systems.
Collaboration is already happening The banks must and will keep on working on their internal projects to improve data management for liquidity management. In parallel, several industry initiatives have been created to address liquidity-related data management issues on a collaborative basis. A Liquidity Implementation Task Force, comprising 19 banks worldwide, is aiming to provide a forum in which common requirements arising from regulatory changes can be identified and agreed, and appropriate responses identified - leveraging existing or enhanced SWIFT services. The first deliverable is the development of best practices for the usage of the intraday cash reporting messages. A similar initiative has been started by nine brokers in the UK, with the objective of developing an industry practice around real-time cash reporting in collaboration with SWIFT. The business and regulatory pressure for financial institutions to improve their liquidity risk management cannot be ignored. The industry has to find solutions to the data management challenges that are holding up progress. The banks must innovate in this area, and, in addition to internal integration projects, the answer has to lie in collaboration. Industrylevel initiatives to address these issues have started and SWIFT stands ready to support its customers in these efforts. 25
Because a lot can happen in a week Each year, Sibos, the annual business conference and exhibition of the SWIFT community, brings together over 7,000 thought-leaders, decision-makers and technology experts from across the globe. For one intense week, key representatives of the world’s leading banks, ﬁnancial institutions and corporates meet with global experts in technology and ﬁnancial services. They debate common challenges facing the industry, share insights and collaborate on building solutions that help reduce complexity, cost and risk. Hosted by SWIFT, the event has become the world’s premier ﬁnancial services and market infrastructure event.
Sibos Toronto 19–23 September 2011 Join us this year in Toronto to share today’s challenges — and to build the solutions for tomorrow. Be part of it — register now at www.sibos.com
Sibos, powered by the SWIFT community www.swift.com
There is plenty of innovation in banking - but more of it needs to be led by the banks, argues Kosta Peric, head of innovation at SWIFT Since the financial crisis, the banks have tended to focus on shoring up the basics of their business. As a result, their emphasis on innovation has lessened. This is understandable and perhaps not entirely undesirable - look where innovation in financial products and lending practices got us last time, you might say. But a reluctance to innovate at this time could prove truly disastrous for the banks when it comes to securing their role as lynchpins of the financial services business in the future. Now is actually the time when the banks should be innovating like they have never done before, and they should be doing it in a collaborative way, to put up a united front against new entrants, and to maximise the value of their innovation strategies for their end customers. Why? For one thing, there are plenty of problems to be solved. New regulation requires financial institutions to do more to comply in new ways across many business areas - and they need new tools to do it. When it comes to developing new tools, there is a range of innovative technologies to exploit - not least the
internet and cloud computing. Another key driver for innovation by the banks is the ever-more intense competition they are facing. This is coming from new entrants such as PayPal, and new business models and currencies, such as Facebook credits and Bitcoin. The new business models that are thriving in todayâ€™s business environment have the potential to sideline the banks. They run the risk of being pushed into a purely back office role, their lucrative customer relationships snatched away from them by more forward-thinking start-ups. It is vital that the banks grasp the importance of innovating in a collaborative way. In more recent examples of technology-driven innovation in banking such as the ATM and internet banking - the banks took a proprietary approach and lived to regret it. In the case of internet banking, each bank built its own service. This was bad for the banks, as it left them supporting proprietary systems that bring them no competitive advantage. And it was bad for their customers - who now must negotiate as many proprietary systems as they have banking relationships. The next big innovation in banking is
mobile payments. And the banks must start innovating in this area in short order - mainly because non-bank providers are already doing so (especially by offering mobile services to the unbanked). The mobile payments train is already out of the station - but the banks still have a chance to get into the driving seat if they take the initiative quickly, and, crucially, if they combine their innovation efforts and collaborate. They need to formulate a collective response to customersâ€™ needs in this area that is more efficient, more open and more responsive to customer demand than anything they could develop individually. There are many exciting areas in which banks can innovate. They can exploit social data. They can take the lead in digital identity. They can direct the future of money. The opportunities are infinite. And the banks can tap into them through initiatives such as SWIFTâ€™s Innotribe, a forum to enable collaborative innovation (Innotribe@Sibos, 19-23 September, Toronto will explore all these areas and more). Banks need to make a decision now to pursue collaborative innovation as a way to secure their futures in a financial services marketplace that is evolving by the day.
Adapt. Compete. Grow. Powering business excellence with technology Business changes daily. To succeed, companies need a technology partner with the vision and experience to stay ahead of the game. At Bottomline Technologies, we position our customers for market leadership today and tomorrow by providing innovative solutions combined with extensive industry expertise.
TRAnSAcTIon BAnkIng SoLUTIonS | SWIFT connecTIVITy | coRPoRATe cASh MAnAgeMenT
A SWIFT Regional Partner and Proud Sibos Sponsor Visit Us at Stand L117
Bottomline Optimise cash lifecycle management with Bottomline Technologies
financial communications pipeline. Combined with SWIFT’s guaranteed delivery, it’s an ideal mechanism for bringing the whole cash lifecycle together into an integrated solution.
Tighter credit controls, the changing global market landscape and heightened financial risk make cash management a critical focus for corporates. This market situation is the perfect opportunity for organisations to better manage their financial assets.
Corporations without the internal expertise or infrastructure to support SWIFT messaging, have a variety of options available to them. SWIFT Alliance Lite enables organisations with lower messaging volume requirements to cost-effectively take advantage of the SWIFT standards through a hosted solution. Another increasingly popular option is a SWIFT service bureau. Structured essentially as an outsourcing of the SWIFT connectivity, a service bureau employs SWIFT-certified experts who handle the on-boarding and infrastructure setup required to send and receive SWIFT messages.
Technology can create new levels of visibility, enabling the optimisation of cash management, ensuring corporate liquidity, reducing costs, increasing efficient use of cash and thus improving overall company financial health. At Bottomline, we believe that cash should be managed throughout the duration of its lifecycle, starting with invoicing and ending with collections. With true visibility and control, organisations will achieve better planning and forecasting, greater efficiencies, enhanced decision making and lower risk. Addressing individual issues such as payments processing or invoicing is important, but taking a more holistic view of cash management across the whole lifecycle yields the greatest results. As a proven leader in payments, collections and electronic invoicing solutions, Bottomline Technologies can deliver on these goals. We combine all elements of the cash management puzzle to create a consistent, efficient and reliable solution for optimisation, efficiency and operational visibility to all cash-related activities. By supporting industry standards, our solutions are built not only to solve today’s business issues, but to be prepared for tomorrow’s challenges.
Benefits from the Bottomline cash lifecycle management approach To support our vision, Bottomline Technologies has solutions that address all segments of the cash management lifecycle. This includes electronic invoicing (e-invoicing), cash management, collections and SWIFT connectivity. Our global customer base achieves significant benefits such as: • Improved working capital management. • Accurate up-to-date cash reporting. • Global coverage with both consolidated and regional visibility and control. • Greater efficiencies and reduced costs. • Reduced risk. The Bottomline cash lifecycle management model brings together technology solutions for a range of different cash-related activities, with a central communications pipe linking them all together. As cash moves through its lifecycle, different services are provided to support the necessary actions and SWIFT connectivity creates a secure
Bottomline’s SWIFT Access Service includes a wide range of SWIFT business consulting, technical services and connectivity options to meet the needs of corporations, banks and financial institutions interested in joining the SWIFT network. “Our intention was to link seamlessly from deal input, through stringent controls to outgoing payment messages with minimal manual intervention. We achieved this goal and gained the benefits that we were expecting from the bureau. We are now in the position that all we have to do is prioritise our payments - our systems take care of the rest,” says Graham Evans, head of treasury operations at Nationwide Building Society. The key to the Bottomline vision is looking at each related cash management task, which rather than being seen on their own, should instead be viewed as part of a larger whole. While improvements can be made and efficiencies achieved through implementing single components, consideration should be given to cash-related activities throughout the lifecycle and including all participants such as departments, companies and partners.
Leaders in cash lifecycle management Improvement in working capital optimisation is a direct result of the Bottomline end-to-end cash lifecycle management approach. It ensures an accurate, real-time view of cash flow and working capital, providing an aggregated point-in-time statement as well as the means to track performance over time. This improved control and visibility make it possible to gain additional insight into factors affecting or likely to affect cash flow, feeding into the ability to carry out much more accurate cash flow forecasting. Bottomline is the ideal partner for organisations that want to optimise and enhance their cash management capabilities. We have more than 9,000 customers world-wide that use our solutions to help them adapt to changing business requirements, compete more effectively in their market and grow to achieve market leadership.
peterevans is a leading provider of real-time, multi-entity, multicurrency, front-to-back securities processing systems which encompass web and mobile access through to interfacing to central securities depositories (CSDs) and custodians.
Lombard Risk’s management and regulatory compliance solutions are used by financial institutions around the world: COLLINE for collateral management; LISA for liquidity analysis; STB-Reporter; and REPORTER MIS for regulatory and management reporting, in addition to its company-founding solutions Oberon and Firmament.
peterevans has over 26 years of experience of the full trade lifecycle from order creation, trade execution, clearing and settlement, asset servicing and client and regulatory reporting. Address: New Broad Street House 35 New Broad Street, London EC2M 1NH Telephone: +44(0)29 204 02200 Website: www.peterevans.com Email: email@example.com
Lombard Risk solutions are now delivered on a state-of-the-art, webbased platform which provides firms with a fully integrated solution to improve the management of risk - including collateral and liquidity - and meet escalating global regulatory demands. Address: London Headquarters, 7th Floor, 245 Blackfriars Road, London, SE1 9UF, UK Telephone: +44(0) 207 593 6700 Website: www.lombardrisk.com Email: firstname.lastname@example.org
Benefiting from over 25 years of successful presence in capital markets, Murex has developed an unmatched competence in the design and implementation of integrated trading, risk management, processing and clearing solutions for buy-and sell-side financial institutions, corporations and utilities located across the globe.
EastNets is a leading provider of global compliance and payment solutions and services with over 1,000 customers in 120 countries.
Built on an innovative multi-business, multi-entity architecture, MX.3 provides a comprehensive enterprise-back office solution. Key features include: • Streamlined back office processes. • Real-time monitoring dashboards. • Pre-packaged clearing workflows. • Seamless integration and connectivity. Address: Murex, 8, rue Bellini, Paris 75782 Cedex 16, France Telephone: +33 1 44 05 32 00 Website: www.murex.com Email: email@example.com
EastNets provides anti-money laundering (AML), anti-fraud, payment and transaction management solutions, and SWIFT plug-ins to add value to SWIFT connectivity for improved risk protection, transparency and cost controls. Through its fully-managed SWIFT service bureau, EastNets provides SWIFTNet connectivity and add-on services for over 200 financial institutions. EastNets is headquartered in Dubai with 16 offices across continental Europe, North America, Asia-Pacific and the Middle East. Address: 450 Seventh Avenue, Suite 1509, New York, NY 10123, USA Telephone: Dubai: +971 4 391 2888; US: +1 212 631 0666; Brussels: +32 2 656 0060 Website: www.eastnets.com Email: firstname.lastname@example.org
Bottomline Technologies provides collaborative payment, invoice and document automation solutions to corporations, financial institutions and banks around the world. The company’s solutions are used to streamline, automate and manage processes involving payments, invoicing, global cash management, supply chain finance and transactional documents. Organisations trust these solutions to meet their needs for cost reduction, competitive differentiation and optimisation of working capital. As a SWIFT Regional Partner, exhibiting at Sibos 2011 in Toronto (Stand L117), Bottomline has a team of SWIFT accredited experts and is known for delivering best practices for SWIFT connectivity. Headquartered in the USA, Bottomline also maintains offices in Europe and Asia-Pacific.
SunTec is a leading provider of relationship-based pricing and centralised billing solutions for banking, financial services and insurance (BFSI), and other industries. Our products and solutions provide a comprehensive platform for measuring and monitoring endto-end transaction value and profitability at various levels. Our pricing and billing platform for the BFSI domain, the TBMS-F suite, has been deployed across corporate, retail and investment banking verticals. Our clientele includes DBS, ICICI, HSBC, ING, Lloyds Banking Group and Axis Bank.
Address: 325 Corporate Drive, Portsmouth, NH 03801, USA. Telephone: +1 800 243 2528 Website: www.bottomline.com Email: email@example.com
Address: SunTec Business Solutions, Kowdiar, Trivandrum, Kerala, India 695 003 Telephone: +91 471 3918300 Website: www.suntecgroup.com Email: firstname.lastname@example.org
peterevans peterevans is a leading independent provider of front-to-back office solutions for the financial services sector. The company is clearly focused on the securities and investment market having over 25 years experience of providing award winning solutions to this sector. The peterevans xanite suite offers a configurable, fully integrated, browser based, comprehensive front-to-back solution that can be either deployed as a single application or integrated as components into your existing platform. xanite has been designed for today’s market, and provides multientity, multi-currency, and multi-language support. User access to the system is configurable allowing each user’s experience of the system to be tailored to suit their specific needs. Each of the xanite modules can be delivered via a software-as-a-service (SaaS) model. The xanite suite of products supports the following business areas: xanite WMS The xanite Wealth Management System is a highly effective solution with a web workbench that can be tailored for portfolio managers and their customers. xanite CA xanite Corporate Actions manages automated data capture, straight-through processing (STP) workflow management and complete entitlement settlement.
Bobsguide Ad 184x132mm 2011v2:Peterevans Ad
xanite CS xanite Custody Services provides a full nominee accounting system, and links to the outside world through industry standard SWIFT and CREST (Euroclear) messaging. xanite PCS xanite Private Client Stockbroking offers a web-based solution allowing stockbrokers, fund managers and asset managers to execute transactions, provide management, tracking and settlement, plus a complete client and compliance reporting suite. xanite OSB xanite On-line Execution Only Stockbroking supports companies offering self managed investment where large volumes of small trades need to be executed. peterevans currently handle around 20 per cent of the retail trades on the London Stock Exchange (LSE). xanite Wave The UK’s first real-time share trading iPhone, application, xanite Wave links to a stockbroker’s back office, providing data and information to display in real time on mobile devices, such as the iPhone, the iPod touch and the iPad. peterevans gives full but controlled access to clients, portfolio, fund and relationship managers, brokers, middle- and back-office staff on line anywhere and everywhere. 5:46 pm
Based on over 25 years research, development and customer experience, peterevans' xanite; a full multi-entity, multi-currency, real time front to back system, for Private Client Stockbrokers and Wealth Managers.
Delivered via a SaaS model, xanite is fully managed, highly resilient, highly scalable, has 24/7 monitoring and no desktop IT footprint.
Covers: Retail Web Access iPhone App for mobile trading Customer Services support Middle and Back Office
Charged on a transactional tariff, this dynamic and innovative approach liberates brokers, securing them a greater share of the cost savings and keeps businesses responsive to market needs and regulations.
Supports the full trading lifecycle including: Portfolio Management Trade Execution Clearing and Settlement Asset Servicing
Visit us at Sibos in Toronto on Stand C125
Links to Crest and 3rd Party Custodians.
For all account types including Tax wrappers such as ISAs & SIPPs Wide range of assets supported including: UK & International Stocks Funds Gilts & Bonds
our vision New Broad Street House, 35 New Broad Street, London EC2M 1NH
52, The Parade, Cardiff CF24 3AB
+44 (0)29 2040 2200
Experts in e-payments
GTreasury specialises in providing world-class treasury management automation (both ASP/SaaS) to corporations, government agencies, and banks worldwide. Through dynamic cash positioning, robust reporting, secured funds transfers, enhanced forecasting, comprehensive debt and investment, foreign exchange (FX) exposure management, and much more, companies are able to gain greater visibility into cash.
Expertus is a Montreal-based company, an expert in payments and a payment solution provider for corporate and financial institutions. In addition to being a long-established SWIFT regional partner in North America, it has been accredited SWIFTReady services since 2002. From its debut in 2001, Expertus has been a global leader in payment solutions and has provided financial institutions with targeted software solutions and consulting services that reduce operational costs and risks. Expertus is a dynamic and growing company that is recognised for its flexibility, innovation, effectiveness and professionalism. It services the North American market with a cost-effective service bureau with its unique software-as-a-service (SaaS) model for lowand high-value payments, filtering against sanction list, message transformation, exceptions and investigations (E&Is), and cash management. Address: 2055 Peel, suite 260, Montreal QC, H3A 1V4, Canada Telephone: + 1 514 842 7508 Website: www.expertus.ca Email: email@example.com
• Global visibility and transaction initiation on all bank accounts. • Scalable - over 50 modules. • Configurable - user friendly. • Single platform - both ASP/SaaS on-site. • Experience - personnel have on average 15 years industry experience. • High performance. • Proven. Address: 3 Corporate Drive, Ste 110, Lake Zurich, IL 60047, USA Telephone: +1 847 847 3706 Website: www.gtreasury.com Email: firstname.lastname@example.org
List of Exhibitors ABN AMRO - www.abnamro.com Accuity - www.accuitysolutions.com ACE Software Solutions - www.acesw.com ACI Worldwide - www.aciworldwide.com Agricultural Bank of China - www.abchina.com/en Allevo - www.allevo.ro Allied Engineering Group - www.aeg-mea.com ANZ - www.anz.com Arkelis - www.arkelis.org AT&T - www.att.com/business
F115 H140 B122 C136 K106 C111 A120 F127 B127 A116
H117 Banco Bradesco S.A - www.bradesco.com.br Banco do Brasil - www.bb.com.br L112 E112 Banco Popolare - www.bancopopolare.it K122 Banco Santander S.A - www.santander.com Bank of America Merrill Lynch - www.baml.com D117 Bank of Inner Mongolia Co, Ltd - www.boimc.com.cn B119 Bank of Tokyo - Mitsubishi UFJ - www.bk.mufg.jp/english J111 Bankersalmanac.com - www.bankersalmanac.com E128 A112 Baoshang Bank - www.bsb.com.cn Barclays - www.barclays.com H121 Bayern LB - www.bayernlb.com F111 BBP AG - www.bbp.ch J124 G125 BBVA - www.bbva.com E125 BMO Capital Markets - www.bmocm.com BNP Paribas - www.bnpparibas.com D121 K124 BNY Mellon - www.bnymellon.com bobsguide.com - www.bobsguide.com PS06 Bottomline Technologies - www.bottomline.com L117 Broadridge Financial Solutions - www.broadridge.com H134 CACEIS Investor Services - www.caceis.com G115 CAD IT SPA - www.cadit.it J121 D111 Callatay & Wouters - www.cw-thaler.com Calypso Technology - www.calypso.com E132 Capgemini Financial Services www.capgemini.com/financialservices H129 CBI - Customer to Business Interaction - www.cbi-org.eu H101 CGI - www.cgi.com K115 China Systems - www.chinasystems.com J108 CIBC Mellon - www.cibcmellon.com L121 CIBC - www.cibc.com/sibos L121 F114 Citi - www.transactionservices.citi.com Clear2Pay - www.clear2pay.com K117 Clearstream Banking - www.clearstream.com E121 CLS - www.cls-group.com H139 D102 CMA - www.smallsystems.cma.se Commerzbank AG - www.fi.commerzbank.com C129 Commonwealth Bank of Australia www.commbank.com.au K128 B111 Complex Systems Inc - www.banktrade.com Copp Clark Limited - www.coppclark.com E110 Credit Suisse AG - www.credit-suisse.com H124
Danske Bank - www.danskebank.com Deutsche Bank AG - www.db.com Distra - www.distra.com Dovetail - www.dovetailsystems.com
H135 C108 E124 G126
Eastnets - www.eastnets.com EBA Group - www.abe.org EFiS EDI Finance Service AG - www.efis.de Equens SE - www.equens.com Eurobank EFG - www.eurobank.gr Euroclear SA/NV - www.euroclear.com European Central Bank - www.ecb.europa.eu Experian - www.experian.co.uk/payments Expertus - www.expertus.ca
D135 A113 C133 H116 H131 F103 B128 F109 E122
Federal Reserve Banks - www.FRBservices.org Finextra - www.finextra.com FircoSoft - www.fircosoft.com Fiserv - www.fiserv.com Fundtech Corporation - www.fundtech.com
H138 J102 D138 J114 J124
B121 Globe Tax Services Inc - www.globetax.com Gresham Computing plc - www.gresham-computing.com M105 gtnews - www.gtnews.com PS06 HSBC Group - www.hsbcnet.com
IBM - www.ibm.com/banking ICICI Bank Limited - www.icicbank.com Incentage AG - www.incentage.com Indian Bankâ€™s Association - www.iba.org.in Industrial and Commercial Bank of China Ltd www.icbc.com.cn Information Mosaic - www.informationmosaic.com Infosys Technologies Ltd - www.infosys.com ING - www.ingcommercialbanking.com Intercope - www.intercope.com International Payments Framework Association www.internationalpaymentsframework.org Intesa Sanpaolo SPA - www.intesasanpaolo.com Invest Northern Ireland - www.investni.com/invest ISBank - www.isbank.com.tr Itau Unibanco - www.itauinstitutionalclients.com
E111 K102 B131 M107 D129 E127 J118 B106 F119 PS01 J117 L122 H136 H103
JPMorgan - www.jpmorgan.com/ts
KBC Bank - www.kbc.com KBC Securities N.V - www.kbcsecurities.com Kurt Salmon - www.kurtsalmon.com
J101 J101 PS05
Landesbank Baden-Wurttemberg www.LBBW-international.com
List of Exhibitors Lloyds Bank Corporate Markets www.lloydsbankcorporatemarkets.com Logica - www.logica.com London Stock Exchange www.londonstockexchangegroup.com McKinsey & Company - www.sibos.mckinsey.com Microsoft Corporation www.microsoft.com/financialservices Misys - www.misys.com MIT - www.mitsa.ch Mizuho Corporate Bank - www.mizuhocbk.com Montran Corporation - www.montran.com Moscow Interbank Currency Exchange (MICEX) www.micex.com Murex - www.murex.com National Australia Bank - www.nab.com.au National Settlement Depository - www.nsd.ru/en Natixis - www.natixis.com Nomura Research Institute, Ltd - www.nri.com NTT DATA Corporation - www.nttdata.co.ip/en NTT DATA Getronics Corporation www.nttdata-getronics.co.ip Nucleus Software - www.nucleussoftware.com
M126 M108 L114 J103 C125 B117 M123 M125 A108 A105 J113 F125 A105 A104 G129 A102 M118
L122 Optitrade - www.optitrade.com Oracle - www.oracle.com/us/industries/financial-services B105 Orange Business Services - www.orange-business.com B125 PASHA Bank - www.pashabank.az Pegasystems - www.pega.com Peterevans - www.peterevans.com Pinnacle Solutions Incorporated - www.psi-nj.com Polaris Software Lab Limited - www.polarisFT.com PPI AG Informationstechnologie - www.ppi.de Premium Technology Inc - www.premiumIT.com
D106 K111 C125 J123 J133 M101 M113
Raobnak International - www.rabobank.com Raiffeisen Bank International AG www.rbinternational.com RBC Dexia Investor Services - www.rbcdexia.com RBC Royal Bank of Canada - www.rbc.com RBS - www.rbs.com/gts RTS Stock Exchange - www.rts.ru/en
J107 M115 C124 C124 C114 A105
L102 S1 Corporation - www.s1.com Sberbank - www.sberbank.ru L111 F130 Scotiabank - www.scotiabank.com S-CountryDesk Gmbh - www.countrydesk.de A101 F138 SEB - www.sebgroup.com SECB Swiss Euro Clearing Bank GmbH - www.secb.de M129 SEI Global Wealth Services - www.seic.com B116 34
Sentenial Ltd - www.sentenial.com H130 SIX Interbank Clearing Ltd www.six-interbank-clearing.com M129 SIX Securities Services - www.six-securities-services.com M129 Smartstream Technologies - www.smartstream-stp.com H111 Societe Generale - www.sgcib.com E105 Software AG - www.softwareag.com G111 Standard Bank Group - www.standardbank.co.za G103 Standard Chartered Bank wholesalebanking.standardchartered.com C107 Sterci - www.sterci.com M120 E131 STET - www.stet.eu Sumitomo Mitsui Banking Corporation www.smbc.co.jp/global C121 SunGard - www.sungard.com C130 SunTec Business Solutions Pvt Ltd L101 www.suntecgroup.com H112 Surecomp - www.surecomp.com Swallow Tech - www.swallowtech.com B102 SWIFT - www.swift.com B127 Swissrisk Financial Systems GmbH - www.swissrisk.com J121 J130 Sybasel, an SAP Company - www.sybase.com J124 Synergy Financial Systems - www.synergy-fs.com SYRACOM AG - www.SYRACOM.com M103 Systar - www.systar.com C103 TAS Group - www.tasgroup.eu Tata Consultancy Services - www.tcs.com/bancs TD Bank Group - www.td.com Temenos - www.temenos.com The Clearing House - www.theclearinghouse.org The Norman Group - www.thenormangroup.com TwoFour Systems - www.twofour.com
C101 B116 D105 M112 L107 PS04 G131
UBS AG - www.ubs.com UniCredit - www.gtb.unicredit.eu
Value Team - www.valueteam.com/English van den Berg AG - www.vdb.de
Vermeg - www.vermeg.com VocaLink Ltd - www.vocalink.com Volante Technologies - www.volantetech.com
D136 G134 D125
Wall Street Systems - www.wallstreetsystems.com Wells Fargo - www.wellsfargo.com/international WestLB AG - www.westlb.com Westpac Institutional Bank - www.westpac.com.au
L103 C117 G119 E113
XSP - www.xsp.com
Zanders - www.zanders.eu
Published on May 29, 2013