What Did the IMF Call a "Significant Disruption" to the Financial Landscape?

The open banking era is upon us, but banking basics still need to be executed as financial institutions weave through the disruption. Most financial institutions do an exceptional job of managing often overwhelming levels of compliance requirements, and must continually navigate change, especially as new tech presents both challenges and opportunities.

• Significant disruption is likely to come from the big tech firms who will use their enormous customer bases and deep pockets to offer financial products
• Other disruptions to financial services include the 2021 phase out of LIBOR, following the 2012 rate manipulations
• As of April 2019, there were $300 trillion in contracts that use LIBOR as a reference rate
• At least $35 trillion in contract value will not yet have expired by the end of 2021
• Another disruption to finance markets is the advent of cryptocurrency with 70% of central banks studying the concept
• But 85% of central banks are not likely to issue a general purpose Central Bank Digital Currency in the next 6 years

CIPS Is Out Of The Crib. How Fast Will It Grow?

From Global Finance -

“As expected it drew some media attention, with the familiar theme that the renminbi—which surpassed the Japanese yen to become the fourth-most traded currency in the world in August, according to SWIFT's RMB Tracker—will eventually overtake the US dollar as the dominant global currency.

The creation of a renminbi-dedicated cross-border clearing system is one pillar supporting the internationalization of the currency. The crucial one, however, is the opening of China’s capital account, a moving target that includes liberalization of the financial sector and cross-border investment flows.

Outside of China, innovation by financial institutions in developing risk management products to align with current and future renminbi demand will also facilitate the currency's growing use.”

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Data Agency Warns of Next Potential Systemic Shock

From American Banker –

“The U.S. financial system may be on the verge of another systemic crash, according to a provocative new report issued this week by the Office of Financial Research.

The report posited that certain stock market conditions resemble the climate just before crises hit in 1929, 2000 and 2007. While some metrics like price-to-earnings ratio are within normal bounds, other indicators suggest that markets are overvalued and headed for a correction for which the financial system may not be adequately prepared.”

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SWIFT announces 10% rebate on 2014 messaging

From Finextra –

“SWIFT announces a 10 percent rebate on 2014 messaging fees which will return more than EUR 30 million to SWIFT users worldwide. The rebate will be paid in early March 2015.”

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