The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Swift’s New UK-based Recruit Aggarwal and Leibbrandt Talk up 2015 Potential Strategies

As indicated during Sibos week earlier this year, Swift is currently sizing up its future potential in the market as part of its new 2015 strategy discussions. Arun Aggarwal, Swift’s recently appointed managing director for the UK, Ireland and the Nordics, and Gottfried Leibbrandt, head of marketing, explained the four potential strategies that are being considered as a way forward for the industry owned network over the next five years during a media briefing this week.

Given that 2010 is just around the corner, Swift’s 2010 strategy is in need of renewal. To this end, the cooperative has indicated that it is currently considering four, fairly divergent, directions in which Swift could move towards over the next five years. These comprise of: core, core extended, go local and marketplace; all of which were first hinted at during Sibos week. According to Leibbrandt, the team is engaged in an industry consultation that has thus far included around 100 interviews with its user community over the last four months to ascertain which of the four strategies are the most popular.

The core strategy would cause Swift to rationalise its current engagements with the industry and stick to what it is perceived to do best, namely financial messaging and bringing costs down. However, Leibbrandt noted that the shedding of “non-essential activities” may be seen by the industry as a “retreat” and indicated that this was not a likely path for the network to go down.

The core extended strategy would mean the extension of Swift’s offerings in certain selected areas, for example around trade matching, exceptions and reference data, noted Leibbrandt. This strategy, along with the go local option, which would involve a possible franchising of the Swift model for local communities, appear to be the most popular thus far, he added. The idea of getting closer to each individual market, which was first launched as part of the 2010 strategy, could be extended one step further under the go local option.

The last, and potentially most controversial, strategy would likely bring Swift into competition with its vendor partners. The marketplace option is based on the idea of Swift acting as a host platform for third party service providers, as well as hosting its own solutions, in order to act almost like a supermarket for financial services processing and messaging solutions. Leibbrandt noted that this model would also include reference data services, although, again, he did not specify what these would constitute.

Swift is currently only half of the way through its industry consultation on these strategies, however, and it is still “early days” to be able to see where most of the market is keen for Swift to move towards, added Leibbrandt. The Swift board will be discussing some of the feedback during its March retreat and the formal announcement of the final strategy will be delivered around Sibos time as usual.

New recruit Aggarawal, who joined Swift in September from solution vendor Tata Consultancy Services (TCS) where he was head of the global consulting practice, added a UK specific dimension to the plans. He discussed the more near term goals of Swift in the market, such as meeting the industry’s needs around reducing costs, dealing with risk and increasing revenue: three tenets that Swift is determined to position itself around. The idea of positioning Swift as a revenue generator is of particular importance, added Aggarawal.

He used a number of recent examples to illustrate the recent progress towards achieving these three goals: “The Accord for Securities matching service, which is around 18 months old, has allowed for a reduction in cost and risk in the industry by providing confirmations matching for FX and OTC trades.” Swift is now looking to extend its coverage to other markets and to deepen the proposition by potentially linking up directly with clearing counterparties (CCPs) in the market.

Another area of potential for Swift is in the data distribution space, extending beyond its current ambitions in the corporate actions space. However, not a lot of detail was provided on this data aspect during the briefing (Reference Data Review will be talking to Swift about its potential in the business entity identification space this week, so watch out for coverage on its way soon).

Swift’s cost cutting effort was also briefly touched upon and Leibbrandt indicated that the programme, which has been dubbed Lean@Swift, is currently halfway through its cycle. The two year programme will allow Swift to deliver its pricing discount next year, he confirmed.

Related content

WEBINAR

Recorded Webinar: Getting ready for Sustainable Finance Disclosure Regulation (SFDR) and ESG – what action should asset managers be taking now?

Interest in Environmental, Social and Governance (ESG) investment has exploded in recent years, bringing with it regulation and a requirement for buy-side firms to develop ESG strategies and meet disclosure obligations. The sell-side can help here by integrating ESG data with traditional financial information, although the compliance burden remains with asset managers. The EU Sustainable...

BLOG

Alveo and AquaQ Partner to Integrate Alveo Prime with AquaQ kdb+

Alveo and AquaQ Analytics have partnered to offer advanced data management and analytics for financial services firms. An early deliverable is the integration of Alveo’s Prime data mastering and data quality management solution with AquaQ’s kdb+ data capture solution. The bi-directional integration allows users to take mastered pricing and reference data from Prime into kdb+...

EVENT

TradingTech Summit London

TradingTech Summit London will explore how trading firms are innovating in today’s cloud and digital based environment to create flexible, scalable trading platforms to support speed to market and business agility. Leveraging the cloud, AI and ML technologies to get an edge, automate processes and simplify operations in a cost effective way is the name of the game and will share practical insight from practitioners and technology leaders who are innovating and driving forward change in trading operations.

GUIDE

Enterprise Data Management Europe 2010

he US may seem to be ahead of the rest of the world in terms of championing the data management cause with the inclusion of reference data focused items in the Dodd-Frank Act, but Europe is not too far behind. Senior European level officials such as European Central Bank (ECB) president Jean-Claude Trichet have taken...