At a roundtable event hosted by Cable & Wireless, SunGard and Intel, senior banking figures from the UK and North America agreed that regulation, better liquidity management, and risk control go only part way to drive the growth of real time information. It is advancing the type of real time services banks are currently offering and raising customer demand that will be critical factors in delivering real time information across the wider banking infrastructure.
Overall, participants agreed that, in order to raise customer demand for real time services, banks need to focus on one fundamental question: How can banks standardise and package real time information in a manner which generates customer demand?
There was consensus that real time information is critical for better management of resources worldwide. Banks agreed that employing technologies and services that use real time information is crucial in order to satisfy regulatory requirements, such as Basel II and Sarbanes Oxley, and to deliver significant improvements to their risk control and liquidity management.
Paul Nixon, Product Market Manager, HSBC Bank, said, “The obvious benefit is risk management and control in the advent of Basel II and Sarbanes Oxley. But the demand really is for better management of positions and managing your risk and liquidity more effectively, whilst reducing the operational cost.”
Participants agreed that while real time information is important for internal operations and helping meet heightening regulatory requirements, the key challenge remains to kick-start the adoption of real time information across the entire banking infrastructure. All members of the panel agreed that banks are now starting to adopt real time information systems globally and a few pioneers are in a position to deliver information in real time to customers across geographic regions. As a result, the debate has now moved on with banks focusing on which specific products and services they must deliver to customers in order to create demand and growth.
David Lowe, Global Head of Operations Risk and Control, ABN Amro, said, “I think in order to make this successful, we need two things. The first is critical mass, i.e. more of us. The other is increased client demand. There is a lot of generic interest from our clients that needs to translate into very real interest. We need to be able to package this into a product that we can sell to customers.”
Gerard Hammarlund, global head of sales, Cable & Wireless RTN, said, “It is no longer a question of what banks do internally with real time information, but how banks actually take this information and make it valuable for the wider community. How banks take this information and turn it into something that they can sell is the differentiating factor.”
Mark Bolton, global sales manager, SunGard STeP, commented, “It is precisely how banks leverage real time information internally that will create value for the customer. The value is in providing visibility to a real time, reconciled position as opposed to the prediction that happens today. Simple transaction reporting will become a commodity as the paradigm takes hold.”
Ian Toone, Managing Director, Global Financial Institutions, RBC Financial Group, added, “The value for customers is getting the required information on demand. At RBC we are currently looking at our various services and identifying what should be delivered in a real time environment and what provides maximum value.”
The roundtable, entitled “Real time cash reporting and liquidity information – drivers, benefits and ROI,” was held in context of the ongoing debate surrounding the value and speed of growth of real time information services and the forthcoming Sibos exhibition, to be held in Copenhagen, September 2005. Discussions were chaired by Eric Sepkes, Director of Cash Management Strategy EMEA, Citigroup Global Transaction Services. Participants on the roundtable included David Lowe, Global Head of Operations Risk and Control, ABN Amro; Barry Holland, Director Treasury Operations, Barclays; Gerard Hammarlund, Global Head of Sales, Cable & Wireless Real Time Nostro (Cable & Wireless RTN); Paul Nixon, Product Market Manager, HSBC; Ian Toone, VP Global Financial Institutions, RBC Financial Group; Mark Bolton, Global Sales Manager, SunGard STeP; and Michael King, Regional Director of UK and Head of Banking Industry Division, SWIFT.