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Gearing Vietnam's securities market for growth
SWIFT Business Forum Vietnam – 21 July 2015
Alexandre Kech, Head of Securities Market Infrastructures & Standards, APAC
Global and regional securities markets trends
SWIFT’s response
Agenda
- Horizontal and vertical
linkages among MIs
- Internationalisation/
regionalisation initiatives
- ISO 20022
- New services (CA,
liquidity management,
collateral)
- “Hubbing” of operations
- Refocus to other
markets (APAC,
LATAM)
- Standardisation
- Automation and best
practice
- Pressure to lower fees
and margins with higher
volumes
- ISO 20022
- Intraday liquidity
reporting
- High quality collateral
- Counterparty
identification
- Account segregation
- Resiliency, reliability,
availability
- T2
- Cyber security
- Automation and STP
- ISO 20022
- Efficiency and
transparency
- Reporting and control
- E.g. trade reporting,
PFMIs, EMIR, CSDR,
etc.
Securities Markets Trends
Regulatory pressure Business risk
mitigation Operational risk
mitigation
Business interoperability
Cost efficiency Innovation
Securities Market Infrastructures
Scaling up
• Aging technology
• ISO 20022 adoption
• Influenced by regional (eg, ABMF) and international push (eg, CPSS-IOSCO)
• ASEAN Economic Community (AEC) 2015
• Developmental forums e.g. ABMF, APFF, CSIF
• Adoption of ISO 20022 and market practice groups
Post-trade system refresh
• CPMI-IOSCO Principles for Financial Market Infrastructures
• Trade data / reporting requirements
• T+2
• More SMIs are including value added services for their community:
▪ Funds Hub to support domestic and/or cross-border order flows
▪ CA golden copy announcement to support date accuracy and automation needs
▪ Collateral Management to help their community to comply with regulatory driven collateral management requirement
Regulations
Business diversification &
value added services
Regionalisation
Internationalisation
India
Maldives
Sri Lanka
Nepal Bhutan
Bangladesh Burma Laos
Thailand
Cambodia
Brunei
Vietnam
Malaysia
Singapore
Indonesia East Timor
Philippines
Hong Kong
Taiwan
South Korea
North Korea
Japan
China
Renewing Technology Clearing and Settlement Projects
Australia
• SWIFT VAP:
✓ SWIFT C&S automation
track record
✓ ISO standards knowledge
✓ Past regional and global
work
✓ Reach
Talking about
Live or planned
Technology refresh
Internationalisation
Regional integration
Message standardisation
Other trends
Corporate Actions Collateral Investment Funds
Challenges
• Mis-interpretation of issuer’s
announcements
• Manual scrubbing laborious & error-
prone
• Missing out CA announcements &
deadlines
Solution
• Issuer involvement
• Standardised templates per event
• Automated dissemination
• New revenue for SMIs
• Address community demands for
higher quality of information
Golden Copy
Challenges
• Funding & liquidity demands
continuously increasing
• Streamlining operations to increase
securities availability
• Account segregation
• Clearstream/Euroclear initiatives
• Regulation
SWIFT Value Proposition
SWIFT automation track record
ISO standards knowledge and dedicated workflow (AFAC for funds)
Past regional and global work
International and regional reach
Initiatives in AP
• Going live: Australia, Singapore
• Working: HK, Malaysia, South
Korea, Japan, Brunei
Challenges
• Emergence of regional funds
passporting schemes
• Streamlining operations to address
manual point-to-point process, poor
service levels
• Regulatory pressure causing scale
issue (beneficial account)
Initiatives in AP
• Live: Korea, HK, TW, AU, CN
• Working: SG, ID, VN, TH
Cross-Border Settlement Infrastructure
Forum (CSIF)
• CSD-RTGS linkage model
• Standardisation and harmonisation of flows
and data
• ISO 20022
ASEAN + 3 Bond Market
Forum
• Phase 3 focusing on
implementation of SF1 &
concluding SF2 work
• Market guide updates
• Country visits
• NMPG build-up
Regional initiatives
SWIFT Involvement: ✓Report reviews
✓Market Guide
updates
✓NMPG build-up
DTCC, US
JASDEC, JP
[Post-trade]
ANBIMA, BR
T2S, EU
CSD, LI
CSD, EE
CSD, LT
ASX, AU
ISO 20022 Adoption – Securities MI & Treasury MI
CLS
Treasury MI Securities MI
SGX, SG
JASDEC &
TSE, JP
[Corp.Act]
Live
CN
BR, CSD
Live
NSD, RU
VP Lux
VP Sec DK
AMBD,
BN
KDPW
CCP, PL NBB-SSS,
BE
KSEI, ID
Live
Live
ABMF
CSIF
Live
Soon
Live
ECB FR
Iran CSD
SADC
Global and regional securities markets trends
SWIFT’s response
Agenda
Transformation projects: around ISO Involved in all major APAC SMI’s projects
10
Clearing & Settlement
• ISO 20022 strategy
• High level and detailed gap
analysis review
• ISO governance support
(maintenance and new)
• MyStandards
• Implementation support
• Trainings
Corporate action (TSE)
• Specification co-writing and
maintenance
• ISO governance support
• MyStandards
Clearing & Settlement
• Standards strategy
• Specifications review
• MyStandards
• Implementation support
• Community engagement
Corporate action
• Specification co-writing and
maintenance
• ISO governance support
Corporate action
• Standards strategy
• Community engagement
• Specification writing and
maintenance
• MyStandards
Post-trade
• Standards strategy
Collateral Management
• Specification co-writing and
maintenance
• MyStandards
• Standards forums
• Customised trainings
• Standards consultancy
Securities M
ark
et
Infr
astr
uctu
re
Com
munity
• Standards forums
• Customised trainings
• Standards consultancy
• Market practice discussion
facilitation
• Standards forums
• Customised trainings
• Standards consultancy
• Market practice discussion
facilitation
• Community workshops
• On boarding portal
Readiness
Portal MyStandards
Clearing & Settlement
• Standards strategy
• Impact assessment
• Specifications review
• Development of 100 new
messages
• Maintenance support for
existing messages
• MyStandards
• Implementation support
• Testing of systems
• Etc.
Clearing & Settlement
• Standards strategy
• Specifications writing and
review
• Community engagement
• Implementation support
• Cross-border connectivity
• Regional market practice
support
• Local integration
• Project management
• MyStandards
• Implementation support
• Etc
Regionalisation Initiatives Driving ISO 20022 adoption and cross-border
communication
How do we help? for ISO 20022
• Standards experts in SG, HK, JP, BE, US
• Compliance to standards and global market practices
• Integration and implementation support
• Capacity building and knowledge sharing
• Community support
Expertise
• Domestic user and practice groups
• Global SWIFT Community
• Reach-out directly to cross-border international parties Reach
• Re-use of SWIFT infrastructure
• Cost efficiency for receiving entities
• Tools to assist with operational efficiency
• Community pricing
Cost
• Proven reliable CSP used by >150 Mis globally
• Resilient, scalable, secure and operationally strong
connectivity choices and associated services
• Community management
Network
Readiness
Portal
MyStandards
13
Strategy Design Internal
preparation Testing Go Live Operate
Business Case Solution design Go Live
assistance Implementation
services
Testing
assistance
Support
Services
End-to-end project management
Training and knowledge transfer
Generic ISO 15022 - 20022 courses and Initiative specific training
Business
mapping
Gap analysis
New message
development &
registration
Market practice
management
Community
testing services
Integration services
Readiness
Portal
Business and
Technical Impact
assessment
Community
consultation and
implementation
strategy
MyStandards
IPLA
AMH / Access
SWIFT: Supporting ISO 20022 adoption from
start to finish
Health Check
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