At the opening plenary session of Sibos, Heidi Miller, CEO of JPMorgan Chase's treasury and securities services segment, threw down the gauntlet to her fellow members of the banking community. Since taking on her new position within JPMorgan six months ago, existential questions had kept her up at night and she said she "was troubled by the position of banks within the industry."
She enumerated four of the issues that most troubled her, which found a strong resonance with the packed room who had gathered to hear her speak. "Why are our products so complex?" she asked. "How can we help our customers make their businesses less complex when we cannot do so ourselves? Why are there so many innovations done by non banks in the payments and treasury services world? And finally why should we pay SWIFT for messaging?"
Miller called on all those present to put aside their differences and come up with actionable plans to reduce complexity, ease access and reduce costs in certain key areas.
She told two stories to illustrate her points. The first was about the ex-CEO of a global bank who had to wait six weeks to transfer the funds to pay for a new boat from New York to London. In that time he could have sailed to New York, withdrawn the money from his account, sailed to London "and still have had time for a leisurely dinner before the funds would have been transferred," she said.
She then told the story of how Meg Whitman of EBay had tried to get her banks to provide a person to person payment system that customers of EBay could have used. They failed and in the end EBay bought Paypal, an online start up that had perfected just such a system in little over a year.
"Why do we support so many redundant systems?" she asked. The speech drew a long round of applause at the end of it and resonated with many of the delegates.
Miller was preceded on the stage by Frank Bisignano, CEO of Citigroup's global transaction services division. Bisignano outlined his vision of a world of borderless banking. He explained how Citigroup exemplified the entire banking community in that it was faced with the challenge of being local everywhere but global at the same time. In this, the challenge was knowing when to collaborate and when to compete.
SWIFT as a product of this collaboration was a perfect example of what the financial industry could achieve when it all pulled together in the same direction.
Welcoming both speakers to the stage, Leonard Schrank opened the session with two pieces of news that showed how far the collaboration under SWIFT was achieving its ends. Firstly, he was able to say that 95% of all SWIFT customers had migrated to SWIFTNet, the global IP platform that the cooperative has developed.
During this period of migration, however, the cooperative has been doing well. Messaging across all divisions was up by 12.7%. As a result, Schrank announced that SWIFT was offering all its members a 10% rebate on all their 2004 FIN traffic. This is expected to yield a rebate of around Eur33 million.