SWIFT push into infrastructure gaining traction in corporate actions
Demand for better information distribution coming from custodians, regulators, and exchanges, which want to boost investor confidence. November 15, 2011 | Peter HoflichA push into market infrastructure three years ago seems to finally be gaining traction for SWIFT, which has been finalising corporate action projects since mid-2000 with stock exchanges in Singapore, Bombay, Shenzhen and Jakarta, and since June 2011 also Thailand. The project allows corporate actions, such as stock splits and other announcements of great relevance to be sent directly via electronic channels to custodian banks, which can in turn distribute the information to investors, thereby mitigating interpretation risk with a fully automated process. The service will be a chargeable service for exchanges, and for SWIFT will mean an increase messaging traffic. According to Adam Wilson, director of securities market for Asia Pacific at SWIFT, the development brings into straight through processing the final element of the securities servicing process, allowing it to finally be automated from end to end. Further corporate actions projects are now also being developed in Taiwan, Japan, Korea and New Zealand, and there will also be a project expansion in Singapore in the future. And while these corporate action projects will probably not all SWIFT to see a great increase in messaging traffic, they have been useful in expanding the SWIFT network, as the stock exchanges in Bombay, Shenzhen and Jakarta had not previously made use of SWIFT messaging prior to their adoption of its corporate actions distribution connectivity. Wilson sees the corporate actions initiative as a good way to warm up new exchanges to the SWIFT world, and to pave the way for further services. In this regard, the Asia Pacific region has been leading the way for securities infrastructure for SWIFT, as there are fewer projects of similar nature in other parts of the world: in Europe the Target 2 Securities project includes corporate actions, and DTCC and SWIFT are in the process of developing a similar capability in the USA, but neither is ready for launch. There has been s... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Asia Pacific, Exchanges, Markets & Exchanges, Payments, Transaction Bankingasia pac,Exchanges,Markets Exchanges,Payments,Transaction Banking, Asia Pacific,Exchanges,Markets & Exchanges,Payments,Transaction Banking, Keywords:SWIFT, DTCC, Adam Wilson, Infrastructure SWIFT, DTCC, Adam Wilson, Infrastructure
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