As reported in the last issue of Reference Data Review, in the build-up to Sibos in Sydney bank owned co-operative Swift had some pretty big ideas about the role it could play in the reference data world. During the event itself, it sought feedback on these plans, and the responses garnered may not have been quite as positive as it had hoped, at least from securities participants (see A-Team Analysis, page 13). To be fair, Swift said all along that it felt working with partners to realise its aims in areas such as securities SSIs would be the best route, but the ongoing absence of any firm tie-up with key player Omgeo casts doubt on how quickly the co-operative can get any kind of SSI offering up and running.
Central to Swift’s proposition for reference data is the concept of collaboration: the industry needs to work together on some of its data related issues, and Swift’s footprint in the market ideally positions it to facilitate such efforts. This notion has some validity in the context of data for which firms rely on their counterparties, such as SSIs, as GoldenSource vice president Tim Lind points out – though he is sceptical of the value of “utilities” as he says they tend not to be the most efficient means of production. But Swift had gone so far as to suggest the possibility of hosting a securities master database, and as Lind says, when it comes to other types of securities reference data like terms and conditions, that dependency on other participants in the trading chain isn’t there. “My ability to manage corporate actions data doesn’t rely on my counterparties; it’s an individual sport, not a team sport.” Add to that the vested interests within the $8 billion market data industry and Swift’s aims in this regard seem highly unrealistic.
That said, by putting reference data on the agenda of a major, financial industry-wide conference like Sibos, Swift did our business a great service, and it was likewise encouraging to see so many of the reference data vendors and data management platform suppliers on the exhibition floor in Sydney, in spite of the distance the European and US players had to travel. Although for many, the venue for the event was part of the appeal of course, with several companies we spoke to explicitly stating that their aim was to leverage not just the association with Swift but also the location in an important Asia-Pacific centre. And numerous Sibos attendees – including A-Team’s own representative at the show – took the opportunity of being in the region to undertake an Asian tour and explore the palpable business opportunities available not only in the leading markets of Hong Kong, Singapore, Japan and Australia, but in the emerging markets of Korea and Tawain, and of course China. There is no doubt that these countries represent the next frontier for financial institutions and technology providers alike. Swift is as excited about the opportunities in Asia as the next company, and even roped in ex-Aussie Prime Minister Paul Keating – one of the founders of the Asia-Pacific Economic Cooperation forum – to share his wisdom on China with a huge delegation over breakfast. Keating actually offered a word of warning on the risks for the banks of leaping into the Chinese market without a full understanding of the pitfalls. But when did financial institutions ever shy away from risk?