1 December 2014

SWIFT Business Forum Romania explores compliance and innovation

More than 140 attend fifth annual event to share insights into payments and securities market developments.

The fifth edition of the SWIFT Business Forum Romania, the annual event of the financial and banking community in Romania, took place in Bucharest on 30 October 2014. This forum, organised by the Romanian Banking Association and SWIFT, offers an ongoing platform for debate of topics relevant to the Romanian financial industry.

The theme of this year's forum was "Financial and Banking Services - from Compliance to Innovation". More than 140 participants came to the Ronda Hall of the Intercontinental Hotel for the event, representing credit institutions, financial investment firms, issuers of financial instruments, providers of IT solutions for the financial and banking market, consultants and trading companies.

Radu Gratian Ghetea, President of the Romanian Banking Association and Romanian SWIFT Member Group Chairperson, opened the conference with an assessment of the banking sector in Romania - as a solid, trustworthy system, that has demonstrated its structural stability and has managed, without major difficulties, to overcome challenges related to the non-performing loans volume and optimising loan portfolios, in the context of regulatory constraints. Ghetea mentioned that the solidity of the Romanian banking sector was confirmed also by recent stress tests performed by the European Central Bank: the subsidiaries of the banking groups included in the assessment have been shown to operate on the Romanian market with capital adequacy rates higher than the regulated thresholds.

Fin Otto Hansen, SWIFT Board member, updated the community on preparations for the SWIFT2020 strategy. Consultation on this is well under way around the world, and the next step will be a discussion paper for the SWIFT community in December. There will be further opportunity for feedback and fine-tuning until the full strategy is published in June 2015.

The importance of collaboration was highlighted by Søren Haugaard, Global Head of Trade & Supply Chain Finance at Danske Bank, who spoke about the benefits of being part of an organisation such as European SWIFT Alliance (ESA). Established in 2001, ESA currently comprises the SWIFT national communities from 30 countries - including Romania since 2009. The organisation provides a venue for co-operation and collaboration and the ongoing sharing of experiences and information regarding SWIFT solutions and infrastructure, but also about the problems and projects of the banking communities in the region.

Andre Boico, Head of Pricing at SWIFT, talked about the organisation's policy to cut transaction costs. He told delegates SWIFT has succeeded - a year earlier than planned - in meeting its commitment to cut prices between 2010 and 2015 by 30-50%. Regarding the development of SWIFT traffic in Romania, Boico said that while on average SWIFT traffic is growing by 10% annually, Romania's traffic has increased by some 42% in the past four years.

The forum continued with a session on the impact of new regulations and the status of the Romanian community's projects in the field of payments and securities in the context of European initiatives, moderated by Michael Formann, Head of SWIFT Austria in the Central and Eastern Europe business of SWIFT.

Ruxandra Avram, Head of Department in the Financial Stability Division of the National Bank of Romania, outlined the main challenges facing the European payments industry: completing financial integration in Europe, protecting consumers of payment services, security of payments, access for entities outside the banking system to payment accounts and monitoring by competent authorities. Avram detailed the provisions and the impact of the Payments Accounts Directive recently approved by the European authorities. The regulation is designed to enable uniformity of practices at a European level with a view to enhancing financial intermediation especially in emerging states such as Romania, enabling the comparability of bank account fees and payments account switching.

In parallel with the need to enforce the new regulations, the banking sector in Romania is also undertaking self-regulating activities around domestic payments. Constantin Rotaru, Senior Adviser and coordinator of this activity at the Romanian Banking Association, explained how Romania's banks have organised themselves for the adoption of SEPA standards for payments in Romanian Lei.

Ionel Dumitru, Adviser to the Director General of TransFonD, then gave a status update on the programme under way to develop and modernise the country's low value payments system, covering progress so far and lessons learned. Dumitru also explained the next stage of the project to launch SEPA Direct Debit, planned for March 2016.

Turning to the Romanian capital markets, Adriana Tanasoiu, General Director of Depozitarul Central, discussed standardisation, collaboration and best practices in the European context - as well as updating delegates about the project to connect Depozitarul Central with Target2Securities, the pan-European settlement system being rolled out by the ECB.

The forum then focused on innovation. Rodica Tuchila, Romanian SWIFT User Group Chairperson, told delegates innovation is key for financial institutions to respond to evolving customer needs and increasing competition. Tuchila highlighted two important technology trends: ‘Computing Everywhere' driven by the growing adoption of mobile devices, and the ‘Internet of Things' which, according to Gartner, will encompass nearly 26 billion devices by 2020.

The keynote speaker in this session, Felix Enescu, ConsultBlue, expanded on the opportunities and the challenges brought about by technological progress, the Internet of Things and the ever-changing requirements of customers - and highlighted trends in the development of financial and banking services in this context.

Corina Mihalache, CEO Allevo, underlined the advantages of open source applications, and the fact that these applications are starting to penetrate the financial sector. Considering this, collaboration on an open platform is important for banks.

Delegates gained insights on new developments in SWIFT's solutions and services - and those of its partners - through a series of parallel interaction sessions covering SWIFTRef, MyStandards, BIC and LEI, Cloud Services, securities solutions and Allevo's open source solutions.

A first for this year's edition of the SWIFT Business Forum Romania was a session dedicated to financial crime compliance. Steven Palstermans, Head of Compliance Initiatives, Central and Eastern Europe, SWIFT, presented the services developed by SWIFT to support the community in meeting its financial crime compliance obligations -  including Sanctions Screening and Sanctions Testing, the KYC Registry and Compliance Analytics.

For more details, presentations and pictures from the SWIFT Business Forum Romania visit the web site.