In an interview with Finextra, BNY Mellon’s Isabel Schmidt explores the changes in thinking towards ISO 20022 over the last decade

Published in 2010, SWIFT’s guidebook ‘ISO 20022 for Dummies’ presents a useful tool to gauge the changes in thinking toward ISO 20022 over the last decade. In an article with Finextra, Isabel Schmidt, Global Head of Direct Clearing and Asset Account Services, BNY Mellon Treasury Services, explores how assertions and predictions made about the migration have played out over the last decade.

Schmidt explains that while a lot of industry discussions currently focus on payment messages and core cash management messages, “overall thinking has also evolved to embrace the concept that a more robust payment message also provides the basis for major efficiency potential in the pre- and post-payment exception and investigations space.”

Schmidt explores how SWIFT’s first attempts to help banks improve this space dates back over 10 years when the E&I initiative was launched and that unfortunately the initiative lacked a sufficiently robust standard to really enable comprehensive automation of exception workflows.

“This space is now being revisited, based on more structured and more robust payment data which the ISO 20022 standard will provide. This is a considerable incremental efficiency opportunity for banks and a further step towards a much-enhanced client experience end-to-end.”

To read the full article, click here.

 

In The Asian Banker, BNY Mellon’s Joon Kim and Arnon Goldstein explore how the bank is digitising to support clients and increase internal efficiency

While global trade volumes have been down significantly in 2020, Joon Kim, the Global Head of Trade Finance Product and Portfolio Management at BNY Mellon, sees “a cautious sense of optimism and recovery” by the latter part of the fourth quarter of this year and the beginning of next, at the macro-level.

Arnon Goldstein, Head of Treasury Services for Asia Pacific at BNY Mellon, observed overall decline in payment volumes, underlining weakness in clients’ demand, but an increase in liquidity, especially in local currency and dollar liquidity as lending demand has been depressed.  However, any rebound in volume will be uneven as some economies continue to grapple with the COVID-19 pandemic.

The disruption to traditional supply chains and logistics has precipitated the need to strengthen business continuity planning to increase institutions operational resiliency and ability to operate remotely. Processes have to be streamlined and enhanced to incorporate alternative digital solutions, such as e-signature and biometric-enabled authentication and authorisation, to replace traditional manual ones. The bank is pivoting to digital alternatives, such as web-based meeting, and digitising more of its internal as well as clients’ processes in order to facilitate client transactions and increase efficiency.

To watch the interview, please click here.

BACB appoints Eddie Norton interim CEO, covered in specialist press

British Arab Commercial Bank (BACB) has announced the appointment of Eddie Norton as interim CEO, subject to regulatory approval. Eddie joins BACB following a successful career with HSBC, where he was most recently the Head of Capital Strategic Initiatives, Global Banking & Markets. Eddie has held international executive positions at HSBC while based in São Paolo, New York, Hong Kong and Malaysia.

Over the course of his career, Eddie has gained experience in supporting trade finance activities across specialist markets, as well as a wealth of governance and risk-related expertise in areas including counterparty, financial crime, regulatory, operational and conduct risk. Eddie commented: “I am excited to be joining BACB, a specialist bank with deep regional and sector expertise and an ability to keep trade flowing for its clients, while upholding the most robust compliance and governance standards.”

The news was covered in Africa Briefing, Africa Global Funds, TXF, Treasury Management International, IFR, TRF News, Trade Arabia and Global Banking and Finance Review.

 

Commerzbank publishes second FI.News of the year

Commerzbank has launched the latest edition of FI.News, the bank’s newsletter for financial institutions. This issue of the biannual newsletter evaluates how the banking sector is building resilience in the face of changing circumstances following the outbreak of the COVID-19 pandemic.

Through interviews and deep-dive articles, Commerzbank’s experts share their latest region- and product-related insights into how the current environment may lead to future innovation and opportunity. The edition contains articles on FIs are accelerating their digital programmes, the importance of ISO 20022 migration, as well as updates on how the COVID-19 crisis has shaped the banking sectors in Latin America and Eastern Europe.

Moorgate-Finn has produced FI.News since 2013. The latest edition can be found here.

Sustainable finance granted new momentum by crisis, writes Commerzbank’s Say Huan Long in Renewables Investor

Sustainable finance had already been gaining momentum prior to the pandemic, but the current situation has prompted a greater sense of urgency around the need to transition towards a greener global economy. Long Say Huan, senior banker for financial institutions at Commerzbank, explores the role of financial institutions in driving this change in Renewables Investor.

The recent oversubscription of the Kookmin Bank’s COVID-19 Response Sustainability Bond, — the first COVID-related issuance by a non-sovereign institution in Asia — provides tangible evidence of growing interest among financial institutions in prioritising sustainable outcomes. Transitioning to a greener economy, argues Long, requires financial institutions’ perspectives to be adjusted to look beyond immediate commercial gains towards longer-term sustainable profitability.

Read more in Renewables Investor.

Commerzbank releases latest edition of FI.News

Commerzbank has published the latest edition of FI.News, the bank’s newsletter for financial institutions. Featuring various in-depth articles and interviews, the biannual newsletter collects Commerzbank’s latest insights on the challenges and opportunities that lie ahead for financial services in today’s transformational times.

Financial institutions are understandably operating in challenging circumstances. Yet this edition of FI.News keeps its gaze firmly ahead –  exploring the ways that the current situation could be a catalyst for change in a number of areas, including digitalisation, trade finance, African trade and sustainable finance. The newsletter also provides latest news stories and internal updates from the Commerzbank Institutionals division.

Moorgate has produced FI.News since 2013. The latest edition may be found here.

Jeff Fallon makes the case for Europe-Africa trade in Financier Worldwide

Africa-EU trade relations have long been critical: the EU is Africa’s largest trade partner and this inter-continental trade barrier will be crucial to spur both region’s post-pandemic recovery.

Writing for Financier Worldwide, Jeff Fallon, head of client coverage at BACB, claims that despite likely changes to risk appetite for supporting this trade corridor, it would be short-sighted to let Europe-Africa collaboration fall behind.

Fallon writes: “Maintaining connections between Europe and Africa will be vital to economic recovery, and specialist banking partners that remain committed to Africa are on hand to help navigate the process.”

Read the full article here.

BNY Mellon’s Carl Slabicki discusses the changing climate of US payments in an article for Finance Monthly

For a long time, banks in the US have competed primarily on price and service rather than as providers of payments solutions. But now, with the emergence of real-time payments, updated legacy rails and a new layer of overlay services, the US payments landscape is beginning to transition to an entirely new payments culture.

Amid this change, as the importance of expediting the journey from paper to digital transactions becomes increasingly clear, Carl Slabicki, Head of Strategic Payment Solutions, BNY Mellon Treasury Services, explores the need for faster payments and more streamlined and feature enhanced capabilities around validation, security and risk mitigation.

To read the full article, please click here.

How can banks support trade in a time of crisis? Citi’s Parvaiz Hamid Dalal examines in an article for Global Trade Review

The impact of the Covid-19 pandemic on trade has been profound. Disruption to both supply and demand dynamics and supply chain logistics have resulted in the entire trade value chain coming under pressure.

Operationally, however, trade flows have shown remarkable resilience. Banks that have invested heavily in trade technologies are now able to deliver digital trade finance solutions that enable their operations and documentary processing to continue remotely and their clients to initiate these transactions remotely, with little (or even no) disruption. Such banks can connect clients and counterparties digitally, enabling end-to-end transactions to be carried out seamlessly, with funds delivered electronically to buyers and suppliers across the globe.

With global trade having to adapt to these unprecedented levels of disruption, Parvaiz Hamid Dalal, Citi’s global head of strategy and solutions, working capital finance, TTS explores how banks can play an important role in keeping business moving.

To read the full article, please click here.

Staying ahead of the curve: bank messaging during the pandemic

Banks were quick to respond to the Covid-19 crisis and have tried hard to stay ahead of the news ever since, writes James Brockdorff, Assistant Account Executive at Moorgate-Finn Partners.

 

It didn’t take banks long to realise the unprecedented threat of the coronavirus pandemic, nor the fact that such a threat required a decisive response. While not on the immediate frontline of the public health crisis, banks understood that the drastic actions being undertaken by governments in an attempt to contain the spread of the virus would have a deep impact on them as vital conduits of finance. Consequently, their messaging would carry significant weight.

So far, banks have understandably followed discernible messaging paths. This started with practical considerations about the impact on operations, followed by measures taken to support the “lockdown” economy. Then came an analysis of the wider macroeconomic situation. And finally the impact on the banks’ own finances.

Bank integrity takes centre stage

As the crisis exploded in early March, protecting staff became a critical primary responsibility for all major banks. HSBC announced the evacuation of several floors of its Canary Wharf head office in London, after an analyst tested positive. Lloyds Banking Group quickly followed, with early communications focusing on the closure of a number of UK offices as staff members also contracted the virus. As banks triggered work-from-home contingency plans, they remained focused on their status as an essential service, with messaging designed to reassure customers of unaffected operations and the continued integrity of IT systems.

Visits to branches and offices became discouraged. Yet phone lines and online infrastructure often struggled to cope with the demand for assistance – with some banks asking clients to bear with them while they experienced longer-than-usual waiting times. Société Générale committed to offering SMEs and professional clients a response about their financing needs in under 48 hours, while Commerzbank promised to dramatically cut bureaucratic processes to get help to clients as soon as possible, as did UniCredit.  

Then came the support

Then came the government’s support packages. Details of the financial support on offer – especially for individuals and SMEs – became the focus of communications, with many banks anxious to demonstrate they were more than just a conduit for government initiatives. They were keen to play a leading role in the crisis for their customers, although media noise of “repaying the favour from 2008” failed to gain much meaningful traction.

Early on, NatWest prepared a two-page guide on how businesses might take steps to protect themselves. The guide, distributed to clients, included standard advice from Public Health England as well as practical guidance on preparing a business continuity plan. Perhaps reflecting their major corporate and financial institution client base, BNY Mellon on the other hand asked clients to share their business continuity plans, pledging to work around their new requirements. Dedicated coronavirus microsites soon became a feature on the homepage of most banks.

Making much of “relationship banking”

Banks waste few opportunities to talk about relationship and partnership. And, predictably, this became a key feature of banks’ communications from early-on in the crisis. BNP Paribas considered the pandemic no less than “a moment of truth in our relationship with our clients and the world around us”.

In practical terms, this has meant overdraft extensions and loan repayment holidays – Credit Agricole and Royal Bank of Canada being two early examples of what became one of the most widespread forms of relief.  Meanwhile, Wells Fargo reported enormous demand for the bank’s small business loans related to the U.S. government-backed Paycheck Protection Program – so much so that the Federal Reserve had to ease restrictions on lending volumes.

Yet the looming economic impact of the crisis was already becoming a focus, with many banks issuing statements to reassure stakeholders of their ability to withstand the crisis.  Deutsche Bank, for example, communicated in March with all staff in the form of an internal letter from CEO Christian Sewing. Later released, the messaging was aimed at reassuring employees that the bank is well prepared and supported by strong credit quality and high liquidity.

Soaring unemployment is becoming one of the unfortunate standout features of the pandemic’s fallout. Here too, banks have been eager to demonstrate their willingness to support local communities, often by cancelling layoffs, as seen at Bank of America. In Spain, Santander called off planned redundancies.

At the heart of all intiatives – and indeed as the central theme of all their coronavirus communications – banks have sought to communicate empathy and understanding, together with a willingness to step up and support those most in need. So far, this have worked, and they have escaped the broad condemnations prevalent in 2008. As the crisis drags on, this may yet be severely tested.