Larc2014 - Road to 2015

SWIFT Latin American Regional Conference (LARC) - 2014

Latin America Regional Conference

29 May 2014

Stacy Rosenthal, Head of Supplementary Products, SWIFT

The Road to 2015

The Road to 2015 (SWIFT2015 Strategy) 18 Initiatives in 4 Key Areas

Deepening the Core Expanding the Core

Enabling Interoperability and TCO Reduction

Interface

Hosting Services

High-End

Interfaces

Low-End

Connectivity Go Local

Enabling Transformation

Brand Platform Innovation People CSR

Reference

Data Sanctions Matching

Custody &

Asset

Servicing

RTGS Corporates Correspondent

Banking

Clearing &

Settlement

2 SWIFT Latin American Regional Conference (LARC) - 2014 28-29 May 2014

The Road to 2015 (SWIFT2015 Strategy) Context

• Evolving context since

SWIFT2015 took

shape

– Increased regulation

– Sanctions, KYC, AML

– Cyber crime

– Asian expansion


4

Sharing our way forward

Compliance

4

5

The Compliance Roadmap

FATF 16 Information quality

Compliance Analytics

Sanctions list

Mngt service

Sanctions KYC AML

Processing

services

Traffic analysis

Standards

Data repositories KYC registry

AML testing & tuning

Sanctions Screening

Sanctions Testing & tuning

(transaction & client systems)

Traffic restriction (RMA)

Live

Development

Qualification

Exploration

Quality

Assurance

Client/Name screening

SWIFT Latin American Regional Conference (LARC) - 2014 28-29 May 2014

6

Corporates

SWIFT for Corporates

Payments

Cash Management

Foreign Exchange

Multi Asset Class Matching

Trade Finance

Supply Chain Finance

Regulatory Requirements

eStatements

eBAM

Reference Data

Global Industry Standards

Implementation Guidelines

Fast Onboarding

Personal PKI Certificates

User Entitlements

Traceability

Single Sign-on

Payment Assurance

Faster Payments

Pre-shipment Finance

Post-shipment Finance

A/R Reconciliation

SWIFT’s Training & Consulting Services

Trouble-free payments and SEPA

compliance

Identity and mandate management

Certainty and efficiency in the

supply chain

Secure financial connectivity

7

Corporate Adoption – Executive summary – 2013

New corporate groups in 2013 173 (20% vs. 2012)

20%

10% 70%

Americas

Asia Pacific

EMEA

Traffic (FIN 31% FileAct 41% Q4 2013 vs. Q4 2012)

Bank adoption

908 banking groups

offering corporate connectivity

46 banking groups certified

573 banks (BIC8)

117 countries

Corporate Group adoption (BIC8)

3SKey: 36 banking groups

BPO: 55 banking groups

31%

FORTUNE Global 500

On SWIFT

1200+ Corporate

groups connected

8

Corporates Steady growth

9

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

4000000

4500000

0

20

40

60

80

100

120

140

160

Jan-1

0

Ma

r-1

0

Ma

y-1

0

Jul-1

0

Sep-1

0

No

v-1

0

Jan-1

1

Ma

r-1

1

Ma

y-1

1

Jul-1

1

Sep-1

1

No

v-1

1

Jan-1

2

Ma

r-1

2

Ma

y-1

2

Jul-1

2

Sep-1

2

No

v-1

2

Jan-1

3

Ma

r-1

3

FIN

Mo

nth

ly T

raff

ic

Co

un

t o

f C

orp

ora

tes S

en

din

g /

Recie

vin

g F

IN

Americas Corporates Growth MTs Sent and Recieved

AMER represents 19% of

the global corporates, but

contributes 43% of the

traffic

Total number of AMER

corporates = 199, across

FIN, FileAct and InterAct


10

Identity & Mandate

Management

3SKey for Authentication

10

11

Identity & Mandate Management Challenges - Multiple portals, several tokens


12

Identity & Mandate Management 3SKey for Single Sign-on

Web e-Banking

Cloud applications

Cash &Treasury portals

Sensitive applications

…

Corporate user


13

MyStandards

13

All standards-related information you need

14

MyStandards All standards-related information you need in a unique and simple platform

Base Standards: MT/MX/ISO 20022

Global market practices

Local market practices

Bilateral guidelines

Internal specifications


15

MyStandards MyStandards

Readiness

Portal

Meet the

experts

Ramp up

Clients

Faster

Self

Service

Testing

Customer

Service

MyStandards Overview

• MyStandards has two main

parts

1. MyStandards web platform

• Manage and publish your client facing usage guidelines

• Base standards content and comparison

• Other publishers usage guidelines

2. MyStandards editor

• The editor is used off-line to define

usage guidelines

• The usage guidelines are then

uploaded into the MyStandards

web platform

16

MyStandards Readiness

Portal Overview

3. MyStandards Readiness Portal

builds upon, and is accessed

from MyStandards

– Internal testing

– Client self-service testing

– Clients test against

Citi specific usage guidelines

– Reduces support &

hand-holding when bringing

on new clients

17

18

19

Accurate and up to date information

Reference Data

19

Your needs..

• increasing regulation pressure and demand

• SEPA, FSA, LEI, … Compliance

• Quality data from guaranteed source

• Data is complete, linked and up-to-date Risk

• Straight-through-processing, repair costs

• Data collection – multiple data sets = limited integration = high cost

Cost

SWIFT Latin American Regional Conference (LARC) - 2014 28-29 May 2014 20

SWIFTRef Purpose

SWIFTNet

for connectivity

SWIFT/ISO

standards for

the format

SWIFTRef for

identification &

routing

MT103

reference

data

Efficient

messaging

+

+

=


A single source of Reference data Accurate, affordable & accessible

All-in Combining worldwide bank identification details,

IBAN/SEPA data

Up-to-date Daily/Monthly updates, no manual maintenance

needed

Easy One single file-import

ERP integration (e.g. SAPTM directories)

Flexible Data can be imported in SEPA-mode or non-

SEPA mode, One country or multiple at the time

T2

EPC

ISO

Bankers

accuity

SSI

Nat IDs -

local ACHs

SWIFT

Licensed

banks MT670

EBA MT094s

The BIC registration authority


Registered corporates 258

Connected to SWIFT 56%

Countries 28

SWIFTRef Adoption - Corporates 258 Corporates adopted SWIFTRef in 2013

23

24

It all starts with data

Business Intelligence

24

Perspectives Swift data can bring you

Switzerland, 10%, 16%, 410,214

United States, 1%, 24%, 385,075

China, 15%, 10%,

165,789

Sweden, -1%, 78%, 145,023

-50%

0%

50%

100%

-15% -10% -5% 0% 5% 10% 15% 20%

Clients

Reciprocity

0% 20% 40% 60% 80% 100%

201010

201012

201102

201104

201106

201108Sum of # Messages sent Sum of # Messages received

Counterparty

evolution

Cross-selling

Customer Credit Transfers Fin. Inst. Transaction Documentary CreditsCollections Foreign exchange

0

50

Tho

usa

nd

s

Customer Credit Transfers Fin. Inst. TransactionTreasury Trade finance

Market insights

Activity share

Peer

benchmarking

51%

25%

7% 4%

13% EUR

USD

GBP

CHF

Others

Market

0

5,000,000

10,000,000

15,000,000 Bank 1

Bank 2

You

Bank 4

Bank 5

Bank 6

Bank 7





29

From CICI to GMEI

LEI

29

Global LEI System

•International financial market regulators

•Upholds governance principles and oversees

that global LEI system functions for public

interest

•Plenary and Executive Committee

• Oversees functioning of the COU, operational

integrity and implementation, maintenance of

standards specified by the ROC

• Appointed and overseen by ROC, composed

of stakeholders from financial & non-financial

firms

• Ensure application of uniform operational

standards and protocols to maintain uniqueness

of LEI and high data quality

• Manage federation through LOUs

• Maintain central logical database

• Provision of LEI functions

• Service providers, local business registries,

numbering agencies

Local Operating Unit (LOU)



Central Operating Unit (COU)

Board of Directors

Regulatory Oversight

Committee

Governance

Operations


CFTC

Regulatory requirements (Part 45)

• Reporting firms must identify themselves and counterparties

with certified CICIs

• Reporting firms must keep records of transactions

• Reporting firms must report transactions to registered swap

data repositories

• Effective since April 2013

• Major Swap Participants / Swap Dealers

http://www.cftc.gov/PressRoom/PressReleases/pr6563-13


ESMA

EMIR - Requirements

• Central role for ESMA

– With Local / National supervision

– Moving OTC Derivatives to centralised clearing (CCPs)

– Standardisation of OTC Derivatives contracts

– Increased market transparency via reporting to Trade Data

Repositories

• Reporting obligations start February 2014

http://www.esma.europa.eu/page/European-Market-Infrastructure-Regulation-EMIR


DTCC/SWIFT Utility

• International Financial Industry

(GFMA) selected DTCC/SWIFT

bid

• CFTC selected DTCC/SWIFT

solution for CICI

• Launch of CICI Utility at

www.ciciutility.org

• ROC Global Endorsement of

CICI Utility

• Re-branding of CICI Utility to

GMEI Utility at

www.gmeiutility.org

• Transition into Global LEI System

8 July 2011

24 July 2012

21 August 2012

3 October 2013

24 January 2014


http://www.ciciutility.org/

https://www.gmeiutility.org/

Utility Statistics (a/o 1 February)

• Statistics

– Total records 109,545

• Regional split

– US 61,566 56.2%

– EU 29,531 27.0%

– Total countries 154

• All endorsed LOUs

– Total records 160,433

– Total countries 164

– GMEI Utility 68.2%



Useful links

www.swift.com/lei

swiftref.swift.com/bic-lei-directory

www.gmeiutility.org

www.leiroc.org


37

Multi Asset Matching

37

Multi Asset Class Matching

Counterparty Corporate

Streamlining and automating processes for tailored risk management,

regulatory compliance and efficiency

Accord / Affirmations

Deal (offline)

Matched

Confirmations

Matching (Accord / Affirmations)

Confirmations (MT 3XX)

38

1 FX Spot or NDF or

Money Market trade 2 Exchange of Confirmations 3 Matching of confirmations

Accord Matching Real Time reporting

and exception handling


Presentations from LARC

http://www.slideshare.net/swiftcommunity


Q&A

?


41

Economy & Finance

Larc2014 - Road to 2015