Swift steps up corporate outreach in Asia

Swift plans to hold a record number of business forums this year as it expands its activities in Asia.

"We're here to hear from you," said Ian Johnston, Asia-Pacific chief executive of the Society of Worldwide Interbank Financial Telecommunication (Swift) at its inaugural business forum in Jakarta last month.

Johnston went on to describe Swift's activities in Asia and what it is doing to support the development of a second generation real time gross settlement system (RTGS) in Indonesia.

"Regarding RTGS implementation in Indonesia, what additional costs will be associated with Swift's involvement?" asked one Bank Mandiri employee.

"The whole intention of Swift providing services in high-value payments clearing is for banks to really use the hardware and the software they already have," responded Johnston. "It should have a very minimal impact as far as cost is concerned in respect of infrastructure."

It's questions like these that Swift hopes to answer with its forums. "Our business forums are an opportunity for local communities to come together once a year to discuss the hot topics of the day related to the banking, securities, trade and treasury markets and to learn what's new from Swift," said Beth Smits, Asia-Pacific head of communications at the collective. "They are in many ways a 'mini-Sibos' [Swift's annual conference] that offers up expert insights on the Asian financial industry and its role within the global industry, as well as closer looks at local or national issues by community leaders and focus sessions on market-specific and technology matters."

Swift currently has 11 forums in Asia scheduled for this year, including events in Beijing, Hong Kong, Jakarta, Melbourne, Mumbai, Seoul, Shanghai, Sydney and Tokyo. This is up from its normal six to 10 and considerably higher than the four it held last year, which Smits said was because Sibos was held in Hong Kong.

"We have seen a similar thread run through all [the forums]; cautious optimism is back for the Asian industry, together with strong determination to cut costs and reduce risk in the collaborative space," said Smits on what Swift has learned thus far from the forums. "The optimism is backed up by impressive growth being shown in Swift traffic this year."

According to Swift statistics, message traffic in Asia-Pacific rose by 19.3% year-on-year during the five months ending in May. This is markedly higher than growth elsewhere in the world; Europe, the Middle East and Africa traffic increased 7.1% and the Americas 8.6% during the first five months compared to 2009.

"While it took two-and-a-half years for Asia to recover from the 1997 financial crisis, it's taken less than a year for the traffic in Asia to rebound [this time]," said Smits. "In fact, for the first time ever, we're seeing Asia grow faster than other regions." She added that year-to-date traffic volumes for the region were at their highest level ever, surpassing the previous peak in 2008.

For the Bank Mandiri attendee at the Jakarta forum, Smits said standardisation is an important theme for Swift users in Asia. "I recall a discussion during a panel in Singapore featuring Lillian Tham, chief operating officer of Schroders Asia, and others. They agreed that 'one good thing' about the crisis was that it has forced the industry to look more at how to standardise, because the only way to decrease the fixed cost of their infrastructure is to standardise," she said.

In Hong Kong, Swift traffic volumes grew 57% year-to-date through May. A rise that Franck de Praetere, head of Southeast Asia, attributed mainly to the conversion of the local RTGS system to a Swift-based platform in May 2009. Other markets that use the collective's common platform include Australia, Fiji, New Zealand, the Philippines, Singapore, Sri Lanka and Thailand.

While the attendees in Jakarta appeared to be mostly representatives of banks, Smits assured FinanceAsia that the forums are for everyone, including corporates. "The business forum gives our corporate users -- and potential Swift users -- an easy introduction to how they can benefit from using Swift to connect to their banks," she said.

Indeed, while the opening session was focused on the upgrade of Indonesia's RTGS infrastructure, the break-out sessions after lunch were focused on services that are applicable to corporate treasurers, including trade and the trade services utility, payments and remittances, and risk management.

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