1

Business and Technology

Solutions

Tom Alaerts

Head of Business Solutions, Asia Pacific, SWIFT

Melody Chua

Corporate Solutions Manager, Asia Pacific, SWIFT

Wifi access code:

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Agenda

• Your corporate onboarding made easy

• Scale up with SWIFT

• Business development through

business intelligence

Corporate Onboardingmade easy

Why are corporates connecting to SWIFT?

Drivers for Corporate Banking Connectivity

• Aggregation of accounts worldwide

• Intra-day / end of day balance

• Cash forecasting for borrowing and investment activities

• Payment factories (A/P consolidation)

• Treasury centralization

• Consolidation of Bank relationships

• ERP / TMS consolidation

• Secure and resilient connectivity to banks

• ISO 20022 standards

Centralization and consolidation

Multibank cash reporting

Compliance and risk management

• Straight-through-processing

Automation

Evolution of Corporate groups on SWIFT

52119

232

407

594

819

962

1135

1380

1539

0

200

400

600

800

1000

1200

1400

1600

1800

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

YoY Corporates Adoption

Why are banks getting ready to offer SWIFT for

corporate connectivity?

7

Perceived as

Innovator

with new

efficient channel

for multi-bank

corporates

New opportunities of business

GROWTH AND RETENTION

“SWIFT connectivity has grown in popularity amongst corporates

worldwide, and since CMB introduced corporate connectivity through

SWIFT in 2008, China is no exception. There are two groups of customers

that we find are most attracted to SWIFT: Chinese companies with an

international growth trajectory, and foreign multinational corporations

investing in China. By implementing this, these companies enjoy a

consistent experience when communicating with their banks worldwide.”

8

Wang WeiXing, Product Manager &

Zhou MuYang, Product Manager, Cash Management,

China Merchants Bank

Most commonly used messages by Corporates

9

FIN

MT940 Customer Statement (3 million statements sent by AP banks in 2014)

MT942 Interim Transaction Report (4 million reports sent by AP banks in 2014)

MT101 Request for Transfer

MT300 FX Confirmation

MT320 Fixed Loan/Deposit Confirmation

MT910 Confirmation of Credit

MT900 Confirmation of Debit

FileAct 0.5 million files transferred in 2014 between AP banks

and global corporates

MT101, MX pain Payment instruction

MX camt, MT940 Reporting

The Challenges of onboarding your

corporates

Many challenges towards efficient corporate

onboarding:

- Can you support corporate-related MT and ISO

20022 standards? (MT940,941, pain.001…)

- How efficiently can you create and share your

specifications?

- How efficiently can your corporates implement

the SWIFT messaging and how much

support does it take?

- How rich is your trade services offering?

- New MT798 functionality

- Do you need integration support?

- Do you need project

management support?

- How well am I doing versus other banks?

Your Bank

Your Corporate

Your Corporate

Your Corporate

Melody Chua, Corporate Solutions Manager, Asia Pacific,

SWIFT

Step 1

Your Bank Readiness Certification

Is your bank ready for SWIFT for Corporates?

It is a standardised corporate environment on SWIFTNet

It is based on a closed user group

It is administered by SWIFT

Corporates can interact with all banks registered in SCORE

Banks can interact with all corporates registered in SCORE

CORPBIC1

CORPBIC2

CORPBIC3 Your institution

SCOREStandardised

Corporate

Environment

Bank readiness certificationProgramme objectives

• Publish bank business capabilities over SWIFT

• Facilitate corporate reach for banks over SWIFT

• Enable corporates to increase their bank reach globally using

SWIFT

• Promote the operational and commercial capabilities across banks

• Endorse bank’s best practices for corporates over SWIFT

Payments

Cash management

Treasury

13

Today’s Entry and Advanced Certification Criteria

Criteria Advanced certification Entry certification

Participate in SCORE Yes Yes

Receive FIN MT 101 and send MT 940 Yes Yes

Send MT 942 Yes No

Send/Receive files over FileAct* Yes* Yes*

Testing facilities & scripts Yes Yes

Operational documentation Yes Yes

Have SWIFT-knowledge and trained sales staff Yes Yes

Offer Basic commercial documentation Yes Yes

Provide either dedicated SWIFT-page on the

bank website OR a contact detailYes Yes

*Bank should comply with FA implementation guideBank Readiness 14

15

Bank Readinesshttps://corporates.swift.com/en/certification/

“It is important to note that the Barclays

team is certified by SWIFT under the

stringent “Bank Readiness Program” and

corporates have a clear view of the extent

of the SWIFT capabilities of the bank.”

16

17

We can train both you and your corporate customers.

• One day training covering traditional messages like:

MT 101

MT 940

MT 300

On request also ISO 20022 messages, CGI guidelines, etc.

• Assistance with SWIFT onboarding process like:

SWIFT-related Documentation

Online application process

Liaising with SWIFT Membership and Legal teams on

behalf of the Corporates.

SWIFT Onboarding – training and support

Step 2

Your Bank Readiness certification

+

Standards management tools

+

Integration support, standards consulting &

training

Tackling the complexity of standards

A collaborative web platform

… to better

manage standards and onboard customers

MyStandardsReadiness

Portal

Specifications and Testing for your customer

Machine specifications (schemas)

Your customer

Documentation (online + PDF)Analysts

Implementers

& systems

Implementers

& testers

Your Bank

Readiness

Portal

Publication

Test against specifications

over internet

All of your

customers can test

against your specific

messaging formats

on-line at the click of

a button!

Bank to Corporates segment

Customer testimonials: CITI

Source: Citi presentation, MyStandards User Group, La Hulpe, 18

November 2015

50% time saving !

23

Customer case study – British Council (Citi’s customer)

• Testing timelines were shortened by 50%

• Citi implementation team was able to monitor testing

progress and offer timely advice to compress overall testing

“Citi’s support of SWIFT’s MyStandards proved to

be highly efficient for us. With our developers

having online access to Citi’s payment and

formatting rules, development and testing was very

rapid.”

Richard Symonds,

Manager,

Treasury Operations, British Council

Key Success Factors

• Secured buy in from top down, ensured alignment of all key players

• Started with small scope and demonstrated value. Then expanded

• Use the kick-start package from SWIFT for a running start

• Thoroughly tested the Usage Guidelines before opening up to clients

APR MAY JUN JUL AUG SEP OCT

Setup Governance

Training and

platform

configuration

Pilot with corporates Expansion to other markets

Live in UK

Customer case study: Barclays

5 months from licencing to live

service

• “This removes the bottlenecks and

streamlines the onboarding process to

the point where we have enhanced

the onboarding time for new clients

from months to weeks”

Nick Morrissey, Director, Cash Management Channels, Corporate Banking, Barclays

• MyStandards fully integrated in BAU

processes

• Significantly (70% +) faster

implementation cycles

• Onboard more clients quickly

• Lighten the workload for subject matter

experts

Business applications not designed to

connect to SWIFTNet

Discrepancy between internal

message formats and SWIFT formats

Specialised SWIFT skills are hard to

find

Complications are multiplied: multiple

systems, multiple internal and

external teams involved

SWIFT

Clients

Service

Providers

26

Your integration challenges ?

SWIFT Services

– In-depth SWIFT

technical knowledge

– Functional analysis

from your

infrastructure

– Solution design

– End-to-end project

management

– Development

– Testing

– Go live

– Maintenance and

customer care

Full integration, standards consulting and

training

Tailored implementation from design to implementation

and support

Services

Integration

Standard

s– Standards consulting

– Expert assistance in all

your corporate to bank

standards specifications,

market practices, mapping

and more.

Training

– Training

– Training of your staff

AND your corporate

customers in the use

of MyStandards &

Readiness Portal

– Training on the correc

tuse of the standards.

Combining SWIFT

services and SWIFT

products

to offer a true end-

to-end solution!

SWIFT Consulting ServicesDelivering an end-to-end solution

Analyse Design Implement Test Go-Live Care

• Bring SWIFT Skills & Experience & Approach

• So you are free to focus on running your business

Scale up with SWIFT

Higher efficiency, lower cost, full compliance and

security

Challenges and solutions

Higher efficiency and reduced

costs

Effective banking

communications

Compliance challenges

Correct messaging without

repairs

Secure and resilient

operationsIndustry standards

Compliant payments

with

high efficiency

and reduced costs

1 SWIFT User – direct or

indirect

2

3

Reduce payments repairs

and delays

Comply with regulatory

requirements

Resilience &

Operational checks

& Business

Development

4

Initiate and receive cross border

transactions

Single Window to the financial world

Your unique identity in the Financial

industry

Bankers world online

Integrated directories

SWIFTRef - reference data

Focused Training

Your

current

level

KYC registry

Sanctions screening

RMA analysis &

cleanup

SWIFT Consulting

services

Business Intelligence

Reduce payment repairs

and delays2

Integrated directories

Bankers World Online

SWIFTRef – Reference data

Focused training

Online access to the complete SWIFTRefdatabase for ad-hoc look-up and research :• All BIC- codes worldwide• 900.000 National bank identifiers from

160+ countries (clearing/sort codes) • 340.000 LEIs (Legal Entity Identifier)• SEPA/IBAN data from 64 countries,

including BBAN-IBAN conversion, IBANvalidation, BIC-from-IBAN derivation,

• 830.000 Bank Standing Settlement Instructions (SSI)

• Bank financials, credit ratings, shareholder & ownership info.

• Country, currency and holiday information

SWIFTRef Bankers World Online For trouble-free payments, regulatory reporting and exploring new

correspondent relationships

- IBAN Plus (IBAN validation)

- BIC Directory Download (BIC validation)

- Bank Directory Plus (BICs, national ids &

more)

Or, files for

automation:

EuropeAlbania France Kosovo Portugal

Andorra Georgia Latvia Romania

Austria Germany Liechtenstein San Marino

Belgium Gibraltar Lithuania Serbia

Bosnia and Herzegovina Greece Luxembourg Slovakia

Bulgaria Greenland Macedonia Slovenia

Croatia Guernsey Malta Spain

Cyprus Hungary Moldova Sweden

Czech Republic Iceland Monaco Switzerland

Denmark Ireland Montenegro Ukraine

Estonia Isle of Man Netherlands United Kingdom

Faroe Islands Italy Norway

Finland Poland

Non European

countries and

territoriesAzerbaijan Mauritius

Bahrain Pakistan

Brazil Palestine, State of

Costa Rica Qatar

Dominican Republic Saudi Arabia

Guatemala Mauritania

Israel Mauritius

Jordan Timor-Leste

Kazakhstan Tunisia

Kuwait Turkey

Lebanon United Arab Emirates

Mauritania

Up to date IBAN info for correct payments to…

“Since we are on SWIFT, we have

reduced 25% of our time on

investigation and message repairs. We

can now more focus on further

Business development.”

37

Introduction to correspondent banking | a 1 day course

What do we do?What topics do we cover?

drawIndustry overview

• What is correspondent banking and what are the trends?

• Why do banks engage in this business?

• Important organizations and regulations: FATF, FATCA, Wolfsburg, Sibos, and Sanctions compliance

• Clearing and settlement processing

Organizational setup

• Typical organization for a correspondent banking department

• Roles, responsibilities and some banks’ examples

• From business relationship to technical relationship (RMA and formats)

Creating a relationship

• What do transaction banks expect from their customers?

• How do they assess accepting you?

• Recurring processes / questionnaires / KYC

• Product offerings and key transaction banks

present

Comply with regulatory

requirements3

Sanctions screening

KYC repository

RMA Analysis & Cleanup

• Fines are getting bigger, but more interestingly:

– Cost of remediation exceeds amount of fine

– Includes limitation to business (e.g. no USD clearing)

– Regulators pay more attention to the quality of the screening

• Banks are terminating correspondent relationships due to:

– Risk factor (weak financial crime controls )

– Low return on relationship due to Cost of compliance

• Impacts large and small financial institutions

– Especially smaller FIs due to the ever growing requirements

– Large FIs face increased regulatory scrutiny

Financial

Crime

Compliance

Navigating in a

complex

environment

Regulatory scrutiny and

enforcement

of sanctions policies is increasing

Increasing pressure from

correspondents to be compliant

Available screening solutions

complex and costly to maintain

Increasing challenges for low-

volume financial institutions

A fully managed service to screen all transactions

Challenges for banksSWIFT provides

• Screening engine & user

interface

• Sanctions List update

service with enhancements

• No additional footprint

• Centrally hosted and

operated by SWIFT

• Real time

• Simple to configure and use

Sanctions

Screening

SWIFT’s hosted

sanction

screening

service

“We chose Sanctions Screening because it is

effective, simple to implement and easy to

use. Sanctions Screening is user friendly,

works well with our other systems, and is

supported by SWIFT’s excellent reputation

for security, reliability and customer service.”

Kheireddine MermiouiHead of IT and SWIFT,

BAMIC ALGER

Know Your

Customer (KYC)

Costs of managing

KYC are becoming

prohibitive for

financial institutions

KYC

Utility

Today there is an unprecedented challenge to comply with KYC

requirements:

Complex and inconsistent requirements across

jurisdictions

Unavailability and poor quality of

information

Cumbersome, repetitive and inefficient bilateral

exchangesIncrease in pressure to reconcile & ‘de-risk’

Increase in AML/KYC fines (>$3 billion/2 years)

Increase in KYC complexity: FATF/FATCA

This has led to a new industry development: the growth of KYC utilities

Why is it important to review your RMA relationships?

Reduce risk

Facts needed in order to

make informed decision

Open door to undesirable

traffic

750k +Dormant relations with APAC

BICs

50%Of total number of

outstanding RMA relations

is dormant on average

Activities offered through RMA analysis and review

Link with FIN

authenticated

transactions to

define the RMA

status

• Three possible

statuses:

• Active

• Dormant

• Unused

Remove list of

identified RMA’s

automatically from

your interface

• Process and

assistance to

facilitate the bulk

removal of selected

unused RMA

relationships

Data

Collec

tion

RMA

Analys

is

RMA

Clea

n-up

Overview of existing

RMA’s inbound and

outbound

• Institution

provides the list

of RMA in XML

• Workshop

implementation

best practices

Key

Findin

gs

Revie

w

Key findings

• List “hot items”

among RMA

correspondence

(overview of

usage with

details at BIC

level)

Business

Evaluation

Optional

Resilience & Operational

check

4

Business Intelligence

SWIFT Consulting Services

Resilience and Operational check

Is your bank resilient and secure enough? Are your operations in line with best

practice?

Are you at risk to miss business because of downtime or security breaches?

SWIFT Infrastructure Health Check of Primary Site and DR site

As part of the health-check we will verify:

Operating system

Hardware

Installation

Performance

Connectivity, including SWIFT network setup

Application setup

Maintenance procedures

Governance

To ensure that your:system and software configuration respects SWIFT best practices

hardware hosting your SWIFT systems is properly sized

Your governance is in line with best practices

Deliverable:Report with each checked item, an indication of the compliance with SWIFT

recommendations and/or best practices.

Business

development

through

Business

intelligence

Growth -10.8%2015 vs 2014

48

Beneficiary countries of Commercial Payments originated from

MalaysiaMT103s originated from Malaysia in 2014 and 2015 (Import)

# of transactions Amount (conv.to USD)

Source: SWIFT Watch

Live and delivered MT103s originated from Malaysia with end beneficiary countries

outside of Malaysia

25.5%

18.8%

8.4%

7.9%

6.4%

5.3%

3.0%

2.9%

2.4%

1.9%

17.6%

24.1%

21.1%

7.3%

6.8%

6.0%

6.4%

2.5%

3.1%

2.3%

2.5%

17.8%

Singapore

UnitedStates

Hong Kong

UnitedKingdom

China

Japan

Thailand

Indonesia

Taiwan

Germany

Others

2015 2014

17.5%

11.9%

9.1%

7.7%

7.4%

6.5%

4.9%

4.3%

3.8%

3.8%

23.2%

17.6%

12.1%

9.4%

8.3%

7.0%

6.6%

4.6%

4.3%

3.9%

3.7%

22.7%

Singapore

China

United States

Indonesia

Hong Kong

UnitedKingdom

Australia

Japan

Taiwan

Thailand

Others

2015 2014

Growth -2.9%2015 vs 2014

Payments route used

United States, 48.1%

Others, 51.9%

Currencies used

USD, 56.0%

SGD, 9.0%

EUR, 7.2%

IDR, 5.5%

GBP, 5.4%

Others, 17.0%

Business Intelligence Insights

Based on # of transactions in 2015

Based on # of transactions in 2015

Growth -11.6%2015 vs 2014

49

Originating countries of Commercial Payments sent to MalaysiaMT103s with Malaysia as end beneficiary country in 2014 and 2015 (Export)

# of transactions Amount (conv.to USD)

Growth +2.0%2015 vs 2014

16.9%

16.2%

6.7%

6.6%

4.8%

4.2%

3.9%

3.1%

3.1%

2.9%

31.6%

16.7%

16.2%

6.6%

6.3%

4.7%

4.3%

4.1%

2.9%

3.2%

2.9%

32.1%

Singapore

United States

Australia

UnitedKingdom

Hong Kong

Indonesia

Saudi Arabia

China

Japan

Thailand

Others

2015 2014

41.0%

14.0%

11.7%

6.5%

4.6%

1.9%

1.9%

1.8%

1.7%

1.5%

13.4%

44.0%

14.7%

9.3%

6.1%

4.8%

1.3%

1.6%

1.8%

2.1%

1.5%

12.8%

UnitedKingdom

Singapore

United States

Hong Kong

Japan

China

Thailand

Indonesia

Netherlands

Germany

Others

2015 2014

Payments route used

Currencies used

United States, 57.6%

Others, 42.4%

USD, 69.4%

SGD, 9.0%

EUR, 5.7%

AUD, 5.0%

GBP, 3.6%

Others, 7.3%

Business Intelligence InsightsSource: SWIFT Watch

Live and delivered MT103s originated outside of Malaysia with Malaysia as end

beneficiary country

Based on # of transactions in 2015

Based on # of transactions in 2015

50

MT700 volume Evolution for

Top 5 Exporters (Malaysia as the

Importer)

Total transactions in

2014 & 2015

-16%

-7%

-16%-8%

-7%

-15%

Growth

(2015 vs 2014)

Market growth: -9%

MT700 volume Evolution for

Top 5 Importers (Malaysia as the

Exporter)

+9%

-2%

+3%

-11%

-2%

Growth

(2015 vs 2014)

Market growth: -5%

Total transactions

in 2014 & 2015

51

MT700 value Evolution for

Top 5 Exporters (Malaysia as the

Importer)

MT700 value Evolution for

Top 5 Importers (Malaysia as the Exporter)

Total Amount in

2014 & 2015

-1%

-51%

-16%+166%

-11%

+20%

Growth

(2015 vs 2014)

Market growth: -29%

Total Amount in

2014 & 2015

-17%

-20%

-37%

-15%

-13%

Growth

(2015 vs 2014)

Market growth: -23%

BI solutions for banks

52

WATCH Analytics

Interactive database

with possibility to build

customized reports on

Swift traffic

Complete set of data

with value and currency

or only number of

transactions

Volume Value

Benchmark your performance and refine market share

assessments

Optimise your correspondent network

Envisage new product and business development

opportunities

53

WATCH ANALYTICS – Library of views

Worldwide Footprint

Volume & Value

ALL Currencies

ALL Market Flows

Filters at your fingertips

Dummy

DATA

54

WATCH ANALYTICS – Create your report and export

Dummy

DATA

New Business Insights

Trade FinanceConfirmation instructions (field 49)

L/C tenor length buckets

(field 31C/31D)

Credit availability (field 41A)

PaymentsDetails of charges (field 71A)

Instructed currencies (field 33B)

Initial Ordering and

End Beneficiary Countries

(field 52A and 57A/58A)

Summary

Q&A?