SWIFT has announced an improvement to its SwiftRef data platform in time for the impending Sibos 2013 trade show in Dubai, UAE, after adding a new Business Identifier Code (BIC) mapping functionality to its Legal Entity Identifier (LEI) directory as standard - previously it was only available to SwiftRef Bank Directory Plus customers.
The addition to the standard reference data processing offering has been made in response to industry demands, says SWIFT, and should enable all its financial and corporate end user clients to more easily cross-reference BIC reference data to the public LEI database. There are of course regulatory drivers too behind the move towards a common, harmonised LEI standard as part of the post-crash effort to ensure that there is more transparency on global markets in future and less difficulty in unwinding trades in the event of another failure like Lehman Brothers; the fifth anniversary of whose collapse on 15 September is fast approaching.
The improved directory is targeted at securities service providers, admits SWIFT, and is intended to simplify their derivatives trade reporting by making it easier to identify and match counterparties. Providers of securities are under pressure to improve reporting following the publication of regulation concerning unique identification of counterparties with a LEI under the US Dodd-Frank Act and the European Market Infrastructure Regulation (EMIR), which both emanate from the post-crash Pittsburgh G20 meeting back in 2009 and are now impacting global financial markets.
“As an issuer of the BIC, it is a natural step for SWIFT to provide a directory to facilitate BIC to LEI mapping,” said Patrik Neutjens, head of reference data at SWIFT. “There is an increasing need for clear and accurate identification of legal entities engaged in financial transactions to monitor systemic risk across the global financial network. SWIFT’s new BIC to LEI directory will help provide this.”
The Business Identifier Code (BIC), also known as ISO 9362, is a standard format identification code for both financial and non-financial institutions allocated by SWIFT and is one the most commonly used international identifier for financial institutions. SWIFT has issued more than 100,000 BICs worldwide so far.
SWIFT announced earlier this year that it will provide daily updates on its SWIFTRef platform, and in keeping with this move it says BIC additions to LEI directory will be made on a daily basis. The organisation calculates that in a typical month approximately 1,400 BICs undergo one or more changes, so daily updates are a necessity. SWIFT expects the new service to be by financial institutions (FIs) and corporate treasuries who process thousands of daily domestic and international payments and need to keep accurate, up-to-date data.
• Bobsguide will be producing a daily show report from the Dubai World Trade Centre (WTC) venue on 16-19 September. See our Sibos 2013 preview blogs HERE