NYBF 2014 - Spotlight on Latin America
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NYBF 2014 - Spotlight on Latin America

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    NYBF 2014 - Spotlight on Latin America NYBF 2014 - Spotlight on Latin America Presentation Transcript

    • Latin America Fund World – Growing Market with a need for Automation Thomas Trépanier Commercial Manager, SWIFT Americas 4 March 2014 SWIFT Business Forum New York
    • SWIFT Business Forum New York 2SWIFT Business Forum New York - March 4, 2014 Thomas Trépanier Commercial Manager Latin America
    • Agenda SWIFT Business Forum New York - March 4, 2014 • Fund Business development in Latin America • Mandated management and implementation of regulatory change • The impact of legislature and market change • Moving from manual to automated environments • How is SWIFT helping? • SWIFT automation • SWIFT Accord • Overall value add of SWIFT 3
    • Evolution of Processes for Funds in LATAM • Inefficient and inconsistent pricing • Lack of consistency and transparency into the net asset value (NAV) • High risk and lack of automation • Inconsistent methods of meeting statutory and regulatory requirements Stage 1 Manual Processes • Automation efforts gain importance • Focus on System Liquidity • Focus on Cross -Border • Focus on cost efficiency Stage 3 Post 2013 • Local market crises abound • Regulatory easing allowing for global reach • Focus on speed of settlement • Readiness for automation Stage 2 Economic Crisises/Global Focus MIsMIs SWIFT Business Forum New York - March 4, 2014 4
    • Ultimately… Processing costs rise as volumes increase, while margins continue to fall Presentation title – dd month yyyy – Confidentiality: xxx 5
    • On top of this - mandated management and implementation of regulatory change – Mexico and Colombia - regulation driving higher level confirmation closer to the point of execution – a process not undertaken by custodians – In Colombia – regulation 1242, and move split of custodian bank duties – a change mandated in law – Chile - pension funds looking to extend their reach direct to funds in US/Europe. More accountability, transparency, visibility and reporting of underlying funds – Brazil, Colombia and Mexico - Increased need for control of investment activity post crisis most of which mandate reporting, or automated affirmation, with at minimum punitive resultant fines for non compliance Presentation title – dd month yyyy – Confidentiality: xxx 6
    • The Impacts of Legislature and Market Change • Matching timeframe consistency is considered desirable, in what is presently a disjointed ‘by market’ approach to settlement instruction and matching (examples Latin America to Europe and USA). • An efficient fails process for trades that have failed to settle is required, these fails could be reduced by increased capture in affirmation. • Minimising fails, will minimise financial fines, buy in penalties and collateral/margin requirements. • Further downstream impact to Corporate Actions, Stock Lending, Associated FX transactions. Presentation title – dd month yyyy – Confidentiality: xxx 7
    • Moving from manual to automated environments • Funds are becoming a Global Business, requiring Global connectivity. Funds are getting bigger and more sophisticated • Around 50% of most institutions trades are not positively affirmed, and industry statistics show that a positively affirmed, or matched trade is 37 times less likely to fail – hence a lessor requirement for Collateral sourcing, Margin and Funding. • Continual focus on cost forces institutions to find better priced, resilient solutions Presentation title – dd month yyyy – Confidentiality: xxx 8
    • How is SWIFT supporting the Latin American region? Presentation title – dd month yyyy – Confidentiality: xxx 9 Concerns - Manual processes & lack of resilience - Multi-Format Challenges - Counterparty Risk - Costs SWIFTsolution - Alliance Lite2 - SWIFT translation - GETC & Accord - Cost savings and reduced fees SWIFT increases the value proposition of a FM to their own clients
    • 10 Continuous Focus on Adding Value to Our Community…..
    • Latin American Interest in SWIFT and Accord Software as a service (SaaS) No initial Investment You pay per use of the service One training is sufficient to use Accord Support 24/7 Availability: 99.999 % 500 entities using the service SWIFT Business Forum New York - March 4, 2014 11
    • SWIFT Accord for Treasury; Enabling real-time matching and exception handling for foreign exchange, money market, OTC derivative and commodity trade confirmations Presentation title – dd month yyyy – Confidentiality: xxx 12 Accord Subscribers (>500 in 72 countries) • Banks • Brokers • Custodians • Fund managers • Corporates • Central banks Accord subscriber or non- subscriber Copies of Confirmations Real-time reporting & exception handling Integration available for various Back Office Systems Deal 4 1 Accord • Real-time Confirmation Matching Service • Availability of >99.97% last 5 years • 100K msgs/hour observed matching capacity • Full Financial Liability for Matching results Confirmations: Message Types: (MT 3xx or, MT 600) 2 C/P C/P SWIFTNet Accord for Treasury 3
    • Strong growth from Latam securities – driven by clearance & settlement, statements, trade status and asset services 13
    • Value add from SWIFT Presentation title – dd month yyyy – Confidentiality: xxx 14 “In the stability of the payment and securities settlement systems embeds an overriding public interest, that moves us to establish special protective regulation, based on the values and that public interest we are seeking to protect “ Basis for future growth Regional Interoperability Emerge as regional market
    • Q&A ? SWIFT Business Forum New York - March 4, 2014 15
    • SWIFT Business Forum New York 16SWIFT Business Forum New York - March 4, 2014 Thomas Trépanier Commercial Manager Latin America
    • • SWIFT Business Forum Canada • Toronto, Canada • 7 April 2014 • Latin American Regional Conference • Mexico City, 28-29 May 2014 • SIBOS • Boston, 29 Sept – 2 Oct 2014 Don’t forget... SWIFT Events • Webinars • www.swift.com/events • http://www.swift.com/events/w ebinars.page? • Industry Events • ACSDA, 2-3 April 2014 SWIFT Business Forum New York - March 4, 2014 17
    • Please provide us with your feedback! • Kindly complete the survey form and submit upon exiting 18SWIFT Business Forum New York - March 4, 2014
    • Thank you SWIFT Business Forum New York - March 4, 2014 19