The Single Euro Payments Area, MiFID, the Target 2 Securities initiative and the Thomson-Reuters megamerger are among the hot topics at this year’s SIBOS.

The annual Sibos meeting attracts finance professionals from across the industry who travel from every part of the globe. This year the organisers expect in excess of 7000 people to turnout in Vienna to network, gossip and talk about the big issues of the day. Since last year’s event in Sydney, Australia, much has happened that warrants fierce debate.

The drive towards a harmonised, integrated single market has never been far from the minds of banking compliance officers, who are charged with transforming European regulation and initiatives into a technical reality. But frequently these initiatives are framed and executed with little regard for the way financial markets operate, or for the conflicting priorities that persist within them – the Single Euro Payment Area (Sepa) being a case in point.

Flawed process

In her feature on the troubled initiative, Michelle Price investigates how the decision-making process behind Sepa has been structurally flawed from the outset, not least because its power brokers have had few incentives to make the scheme a reality. Charlie McCreevy, the European commissioner for the internal market, in an interview with The Banker, takes on the critics of the Sepa project and discusses how it has been handled at a European level.

The Markets in Financial Instruments Directive (MiFID) faces similar difficulties.

A top level panel, chaired by The Banker’s editor, Brian Caplen, met to find out whether MiFID is achieving its goal of harmonising the industry and to discuss exciting developments such as new platforms and sources of liquidity.

The European Central Bank’s (ECB) dream of creating one platform for settlement in the eurozone, in order to lower costs and harmonise practices, has also met with scepticism from the industry. Silvia Pavoni reports on how the Target 2 Securities initiative has been met with resistance by central securities depositories on the one hand, who plead potential loss of business, and with joy by bankers, who can’t wait for the cost reductions. The big question, however, is whether or not the ECB is capable of delivering such a complex project at all.

As these initiatives show, the importance of industry co-operation and the drive towards increased standardisation has never been greater. For this reason, many continue to look to Swift, a near-industry institution, to continue to smooth out the numerous wrinkles in the financial supply chain, and to grow its franchise in areas such as settlement and asset servicing.

Industry distractions

But many fear the industry co-operative has become distracted from its true purpose by the business of software and application development, an area that has historically proven weaker and less valuable to the industry than its core services. In her interview with the company’s CEO, Lázaro ­Campos, Michelle Price asks if Swift is suffering from an identity crisis.

Finally, one of 2008’s biggest events was data giant Thomson Corporation’s £8.7bn ($16.2bn) buyout of one of the world’s most iconic journalistic institutions. Thomson’s purchase of Reuters in April was hailed by the industry as a complementary marriage, creating a much-needed direct rival to Bloomberg – or so pundits claimed.

Five months on, however, and the shape of this new data giant is still unclear, while the benefits to the industry at large have yet to be properly outlined.

Charlie Corbett reports on the challenges the world’s newest data giant will face with the integration and how a merged Thomson Reuters will affect the competitive landscape.

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