SWIFT Institute @ Sibos

Better than a thousand days of diligent study is one day with a great teacher.

So says a Japanese proverb.  The SWIFT Institute will bring not one, but many great teachers to Sibos Singapore in 2015.

Throughout the week you will have the opportunity to attend lectures given by a variety of academics on a range of topics impacting the global financial industry.

Each lecture will last 30 minutes, including time for Q&A. And you will have the opportunity to meet the academics after their lectures.  All lectures will take place on the SWIFT stand on the Exhibition Floor.

Also look out for the first ever Sibos quiz show – A Question of Finance, which will take place in the SWIFT Auditorium on Tuesday 13th at 4:30pm. The quiz show will see mixed teams of academics and financial industry professionals compete on their financial as well as general knowledge. Just how smart are academics and industry professionals? Come along and find out!

It’s not all work, work, work, and so immediately following A Question of Finance, you are welcome to join us for a drink at the SWIFT Institute and SWIFT’s Business Intelligence cocktail reception.  This will take place in the SWIFT Auditorium beginning at 5:15pm.  All are welcome.

Finally, on a more serious note, the SWIFT Institute is joining the Compliance Forum for a special session on Wednesday morning, where new research will be presented and then debated by a panel of industry professionals. SWIFT Institute Meets the Compliance Forum takes place at 8am on Wednesday 14th in Conference Room 2.

I look forward to welcoming you to Singapore in October.

Peter Ware
Director of the SWIFT Institute

Agenda

Monday 12th October

• 4:00pm – Safeguarding Financial Integration
  • The ongoing European financial crisis was both predictable and preventable. The next crisis will be as well. Hence the two relevant questions are what should policymakers be doing to avoid unnecessary financial turmoil and why are they so reluctant to take the necessary measures – particularly when the costs, both human and financial, are so disproportionate. The purpose of this talk is to derive the ‘lessons’ of recent European experience and to show how these lessons have been learned, time and again, through the experience of financial integration both within countries and between them. This historical precedence is important to highlight the political complexity of developing more robust financial institutions. It also makes it easier to reframe the challenge in safeguarding financial integration. Politicians and policymakers are free to ignore the lessons of history, but only if they understand and acknowledge true costs involved in doing so.
  • Erik Jones, Professor of International Political Economy, The Johns Hopkins University

Tuesday 13th October

• 2:00pm – When Will We Ever Get the Incentives for Faster Payments Right? Analytics to Pave the Road toward Future Money
  • In the digital economy, everything wants to be faster. Faster product delivery, faster sales capabilities, and faster access for consumption – but in the middle of it all, faster payments need to be given more attention. Making payments faster is challenging though, due to the need to align the incentives of the different participants in the payment system. Big and small banks, commercial and savings banks, and banks in different countries — and their customers — will have different perspectives on whether to delay or accelerate payments. Crafting the ‘right’ incentives are central to the performance and success of a faster payments mechanism. Tradeoffs between costs and benefits are what drive the timing of payment settlement and the success of the systems. We have developed a hybrid priority queuing mechanism to align the banks’ incentives to achieve faster settlement. This allows payments to be prioritized by the participants or the system intermediary, and be delayed or processed and settled immediately. Our interactive visual demo illustrates how bank participation, payment demand, settlement frequency, and the reserve funds available affect the system’s performance. But without coordination and harmonious collaboration, faster payments will not become a reality. Our analytics approach addresses the complex incentives associated with clearing and settlement, and through the understanding it offers, paves the road toward future money.
  • Robert J. Kauffman, Professor of Information Systems; Associate Dean (Research), School of Information Systems, Singapore Management University
• 2:30pm – Cross-Border Stock Market Links in Asia: What Makes One a Success?
  • To generate more capital flows, greater liquidity and investment opportunities, stock markets in Asia are beginning to embrace the idea of cross-border stock market links such as the Hong Kong-Shanghai Connect, the ASEAN Exchanges, and the recently announced Taiwan-Singapore Stock Trading Link. These links might be understood as variants of the hub and spoke model to streamline the convoluted spaghetti flows of cross-border trades, but a closer examination reveals differences in the operating models for the underlying trading, clearing and settlement operations. This talk will discuss the various operating models for cross-border trading links in Asia. What are the relevant technological, market, and institutional conditions that might determine the variations in these operating models? What are the related challenges that need to be tackled to make such cross-border market collaborations successful?
  • Carol Hsu, Professor in the Department of Information Management, National Taiwan University
• 3:30pm – Currency War – A Window for the Rise of the Renminbi
  • A balance-sheet recession since 2009 has forced developed market central banks into a sub-optimal policy path of a currency war, which is indeed a zero sum game that has spread to the emerging markets. Behind the currency war, there are seismic structural shifts unfolding for the G3 currencies (USD, EUR, JPY) and emerging markets, giving rise to some secular trends that are conducive to the rise of the renminbi to challenge the global dominance of the G3 currencies. The rise of the renminbi is both an indicator and a result of the evolution in the global macro landscape that shifts economic weight from the developed markets led by Europe, Japan and the US to emerging markets led by China. This lecture will explore the outlook for redefining the global major currency club from G3 to G4 by including the renminbi.
  • Chi Lo, Part-time Lecturer at the Chinese University of Hong Kong
• 4:30pm – A Question of Finance – The SWIFT Institute Game Show
  • The first ever Sibos quiz show, taking place in the SWIFT Auditorium, partners’ university academics with financial industry professionals for a battle of wits. The quiz will feature two teams of experts answering questions on their own areas of expertise, as well as other areas where they may not be so well versed. Each team will be led by a captain of academia, with two supporting “stars” from the financial industry. Singapore Slings will be served on arrival to the audience…and contestants! This will be a great session to round off the day in the SWIFT Auditorium. Just how smart are academics and financial industry professionals? Come along and find out! Immediately followed by a SWIFT Institute and Business Intelligence networking cocktail reception.
  • Host – Julia Streets, Director, Streets Consulting Ltd.
  • Team 1
    • Erik Jones, Professor of International Political Economy, The Johns Hopkins University
    • Paul Inglis, Head of Payments Industry, ANZ
    • Ruth Wandhöfer, Global Head of Regulatory & Market Strategy, Citi
  • Team 2
    • Robert Kauffman, Professor of Information Systems, Singapore Management University
    • Marcus Treacher, Board Member and Chair of Corporate Advisory Group, HSBC
    • T.S. Shankar, Managing Director, Head, Clearing & Liquidity Management, Standard Chartered
• 5:15pm – The SWIFT Institute and SWIFT’s Business Intelligence Cocktail Reception
  • Immediately after the quiz show, the SWIFT Institute partners with SWIFT’s Business Intelligence team to host a cocktail reception in the SWIFT Auditorium.  Singapore Sling’s will be served!  All are welcome, so come along for a drink and a chance to meet the SWIFT and SWIFT Institute teams, academics, quiz show contestants and your fellow Sibos colleagues.

Wednesday 14th October

• 8:00am – SWIFT Institute Meets the Compliance Forum
  • Since 1996, the rapid development of third-party payment providers, particularly for online purchases, has facilitated business development and helped boost overall economic growth. At the same time, the anonymity afforded by third-party payments has brought with it the increased risk of money laundering and terrorist financing, as well as increased opportunities for gambling, fraud, and phishing, amongst other illegal activities. While regulation has increased exponentially for banks and other financial institutions, its development has been slower in the third-party payment space. That appears to be changing, however, particularly in the area of anonymity and virtual currencies. This session will present newly published research into the risks and measures that are being put in place to regulate such activities. Are these measures enough or is additional mitigation required?
  • Moderator – Jonathan Rosenthal, Editor, The Economist
  • Cheryl Gurz, Emerging Technology Segment Manager, BNY Mellon
  • Patricia Jouan, Head of Societe Generale group Financial Crime , Société Générale
  • Carolyn Burke, Payments, RBC
  • Nathan Van de Velde, Legal Researcher, ICRI-CIR – iMinds, KU Leuven
• 2:00pm – Risk Management in the Age of Disruption
  • In this brave new world powered by exponentially evolving technology, every organization faces disruptive threats. Titans managed with centralized predict and control paradigms will increasingly stumble as non-linear interactions result in unanticipated changes. Furthermore, in an over-connected world, small failures can quickly cascade into systemic breakdowns. As in healthcare, our best chance for managing systemic risk lies in early diagnosis and action. And yet, how do we differentiate signal from noise in a deluge of data? Network science enables us to detect hidden patterns in complex data, and to proactively mitigate emerging risk before tipping points are crossed. We will show how Financial Cartography can serve as a mass collaboration platform to amplify social intelligence and navigate an increasingly challenging landscape.
  • Alan Laubsch, Director, Financial Network Analytics (FNA)
• 2:30pm – How and Why China’s Domestic Securitization Market Will Leapfrog the West
  • China’s domestic securitization market began as a casual outlet for disposing impaired bank loans and funding municipal projects. Since the end of 2012, however, China’s financial system regulators have worked intensively and collaboratively to craft a workable, whole-market architecture. In 2014, what had begun as a pilot morphed into a serious channel for raising domestic debt capital. Today China’s private sector is pushing the domestic market towards exchanges and the internet, breaking through the barriers of the Anglo-Saxon ABS model.
  • Ann Rutledge, Adjunct Assistant Professor of Finance, Hong Kong University of Science and Technology
• 3:00pm – Transparency in Securities Transactions and Custody Chains
  • In the post Global Financial Crisis environment, participants in global capital markets take it for granted that their securities transactions will be supported by operational systems that offer a robust clearing and settlement process. Global custodians and the systems that they use operate in an electronic, intermediated and cross-border environment whereby physical assets have been replaced by electronic records. However, the securities settlement industry is facing intensive regulatory pressure to establish with greater certainty transparency in securities transactions and custody chains. The requirements of KYC, AML and sanctions screening place greater importance on the need for custodian banks to have a clearer understanding of who lies behind cash payments, securities transactions and assets in custody. The omnibus account which is seen as a primary source of operational efficiency has regulators concerned because it can be difficult to identify who the ultimate beneficiaries might be. Those concerns, however, may not be justified. New research commissioned by ISSA found that omnibus and segregated account systems, as well as hybrid systems that bridged the two, offer benefits to their respective users as well as disadvantages. In this talk Professor Stuart Weinstein will discuss those benefits and disadvantages, and suggest the way forward for both the industry and regulators to achieve closer alignment.
  • Stuart Weinstein, Professor of Practice Informed Legal Education, and Head, Coventry Law School