LCH’s Post

“Navigating the Evolving Risk and Control Agenda in Transaction Banking: Challenges, Strategies, and Tech Enablers”. This session will explore the transaction banking risk and control landscape. Covering key areas including financial crime, regulatory capital requirements, and geopolitics. The panel will also debate to what extent technology can enable us to manage these dynamic challenges. Moderated by Tom Hill, Head of APAC , FCC Compliance of BNY with Dr Tom James, CEO and CIO of TradeFlow Capital Management; Anandan Murugesan, Head of CFCC Risk measurement of Standard Chartered and Julie Patterson, Executive, Specialised Lending Operations, Corporate and Institutional Banking of NAB. BAFT (Bankers Association for Finance and Trade) https://lnkd.in/eaCa9_XG

Santander Corporate & Investment Banking along with Lloyds Banking Group and UBS successfully completed the first uncleared bilateral margin #payments using the digital representation of #central #bank #funds on the Sterling Fnality International Payment System (£FnPS). This real-world proof-of-concept proves that Fnality International can be used to make bilateral margin payments using the £FnPS, and marks the first instance of a fully regulated #Distributed #Ledger #Technology (DLT)-based payment #system being used to settle margin for the purposes of real-world #inter-bank #derivative exposures. These successfully settled margin #transfers mark the first step in the potential use of £FnPS for cleared margin payments in the future, and is expected to ultimately enable significant #balance #sheet benefits for #banks. Congratulations to all involved in this successful venture!

Bank of America’s Multicurrency Netting Program was named Best Treasury Management Initiative for reducing FX trade and settlement volumes by an average of over 85% and saving around 40 manhours weekly, which boosted its treasury’s operational efficiencies.     This initiative targeted minimising intercompany FX transactions and gross exposures for a customer facing rising transactional costs and complex treasury processes after a merger.      The bank shifted to a weekly netting cycle from monthly, offered guaranteed FX rates, and integrated an automated workflow solution with the customer’s enterprise resource planning blueprint.     The Transaction Finance Awards 2024 recognises achievements in key business and operational areas of the financial services industry. They programme highlights the winning banks’ annual achievements, competition for market share, and product and operational excellence. The awards were presented on 23 May at the Conrad in Hong Kong in conjunction with The Asian Banker Summit, now in its 25th year.     See all the winners here: https://bit.ly/3QZ66AU     Foo Boon Ping 胡文彬, Chris Kapfer, TAB Global    #TransactionFinanceAwards2024 #BankingAwards #TransactionBanking #CashManagement #TradeFinance #Payments #FinancialServices #BankingExcellence #Tokenization #SustainableBanking #GlobalBankingAwards #Banking #BankingIndustry #Excellence #CorporateBanking #TheAsianBanker #TABGlobal

Global banking watchdog cracks down on big lenders gaming capital rules LONDON - Global banking regulators proposed measures on Thursday to crack down on "unacceptable" attempts by the world's biggest banks to game rules in a bid to avoid heavier capital requirements. About 30 globally systemic banks (G-SIBs), such as JPMorgan, HSBC, BNP Paribas and Morgan Stanley, must hold more capital than smaller domestic peers, based on a range of factors, which determines which "bucket" they are slotted into, and therefore how much extra capital they must hold. The rules were introduced a decade ago after many lenders were bailed out by taxpayers in the global financial crisis. "The proposed revisions aim at constraining banks' ability to lower their G-SIB scores through window-dressing," the Basel Committee said in a statement. The aim is to stop "regulatory arbitrage behaviour" that seeks to temporarily reduce banks' perceived systemic footprint around the reference dates used for the reporting and public disclosure of G-SIB scores. "This will be achieved by requiring banks participating in the G-SIB assessment exercise to report and disclose most G-SIB indicators based on an average of values over the reporting year, rather than year-end values." #globalbanking #watchdog #gaming #capital #rules #worldsbiggestbanks #jpmorgan #hsbc #bnpparibas #morganstanley #hold #morecpital

Commerzbank AG revamps platform for cross-border payments. Commerzbank is updating its existing payment platform in Germany to process cross-border payments via the Swift network and to process high-value and urgent payments via the TARGET 2 or EURO 1 payment systems. To achieve this, the Bank is using the TRAVIC-Payment Hub developed by PPI, which has native command of the formats that are now becoming common in international transactions as per the International Organisation for Standardisation 20022 (ISO 20022). The plan is for the migration to be complete at the end of 2025. At that point, Commerzbank wants to use the PPI platform to process all payment messages in Germany for its customers’ global activities in foreign commerce, treasury and their liquidity management in ISO 20022 format. This includes high-value payments within the Euro system for the TARGET 2 clearing system and the Euro Banking Association (EBA)’s clearing system with EURO 1, as well as correspondent bank payments or payments in foreign currency via the SWIFT network in the Cross Border Payments and Reporting (CBPR+) format. Source: https://lnkd.in/et8P572S #banking #bankingindustry #bankingservices #banks #bankingtech #payments #financialtechnology #financialservices

Last month marked 50 years since the collapse of Cologne-based Herstatt Bank, an epochal event that sent shockwaves through foreign exchange bourses, halted the New York interbank market and imperilled major financial institutions. With assets of DM2bn ($800,000 at then-exchange rates), Herstatt was a mid-sized German bank that had overextended itself with risky bets on the US dollar. When a series of large wagers it had placed catastrophically failed, Herstatt was left owing substantial amounts it could not settle, leaving numerous counterparties nursing losses. By the time the bank had been declared bankrupt on June 27 1974, Herstatt’s FX operations had chalked up a then-staggering loss of DM470mn. This event, which would prompt the establishment of the Basel Committee, underscored the acute risk of settlement delays in FX transactions. This is now known as ‘Herstatt risk’ or more commonly, ‘settlement risk’. Jose Manuel Ortiz-Repiso, head of clearing and repo ops at SIX, writes: "Today, we have a better grip on settlement risk. A recent snapshot from Goldman Sachs reported a 'significant improvement' in achieving a “greater than 99%” same-day settlement rate. "Yet, when it comes to FX, we should not become complacent. Half a century on, the Herstatt affair still offers salutary lessons on clearing and risk management processes for both derivative and spot markets." Read more below👇 https://lnkd.in/erpcBeGz #SettlementRisk #HerstattRisk #banking

Great insights from Bart Schmeetz Global Head of Financial Markets at ING during ICMA - International Capital Market Association 2024AGM in Brussels. He was interviewed by Maria Tadeo and explained how he transformed the organization of the Markets activity in the last 4 years by focusing on people and changing the management team, by creating and implementing a new digital strategy and by focusing on risk technology improvements to offer new products for flow and complex products. Change is hard but it’s great to see how it can be done successfully. ING Wholesale Banking #financialmarkets #trading #ICMAAGM2024

Hurdles to M&A in Europe's fragmented banking sector - https://lnkd.in/gswePWCC UniCredit's purchase of a stake in Commerzbank has fuelled speculation about further European banking consolidation, after this year's hostile bid for Sabadell by Spain's BBVA's . Read More: Hurdles to M&A in Europe's fragmented banking sector

Terrific progress by Lloyds Bank Corporate & Institutional on both origination (DNI Initiative) and distribution (TFD Initiative) fronts - the two strategic initiatives under ITFA #Fintech Committee supporting a fully digital originate-and-distribute model, and opening up the asset class to institutional investors. ‘I am thrilled to welcome Lloyds Bank as sponsor of the 2024 Investor Day,’ said André Casterman, CEO of the TFDi and Board Member at ITFA. ‘I am impressed with the start-up mindset demonstrated by the trade team at Lloyds Bank. The multiple digital transactions delivered by the team over the last 18 months, and the openness to apply new technologies have been elevating Lloyds Bank as a role model on the implementation of the ETD Act.’ Gwynne Master, Managing Director, Lending & Working Capital at Lloyds Bank said, ‘The time has finally arrived to expand, standardise, and promote distribution of trade as an asset class under the International Trade and Forfaiting Association's Trade Finance Distribution Initiative, and we are delighted to sponsor its Trade Finance Investor Day.’ The 2024 Trade Finance Investor Day promises to bring together industry leaders, innovators, and policymakers to discuss the future of trade finance. Lloyds Bank’s sponsorship and participation in the event underscore the bank’s commitment to supporting and leading innovation in the trade finance industry. Jon Boran Surath Sengupta Rogier van Lammeren Cláudia Márcia dos Santos

Rabobank announced a tender offer for €1 billion out of approximately €7.8 billion of its certificates, which are among the rare "true" perpetuals on the market. With a clean price of 108.5, this represents about a 5% premium over the pre-announcement trading price, making the offer likely to be accepted. This strategy aligns with the bank's current excess capital position, with a FY23 CET1 ratio of 17.1% versus an 11.1% requirement. With a fixed 6.5% coupon in EUR, the certificates could become costly for the bank if the European Central Bank significantly cuts rates later this year. The bank might then consider repeating this operation to continue deleveraging. #rabobank #fixedincome #at1 #subordinateddebt #bonds #europeanbanks #europeancredit #credit #financials #financialcredit #financialbonds #cocos #contingentconvertible #certificates #ecb #europeancentralbank #banking #banks #rates