SWIFT for Mid-Sized Corporates –
A Sibos Review
by Helen Sanders, Editor
While Sibos 2007 was mostly attended by large, multinational corporates with multiple banking relationships, this year’s event saw a broader spectrum of companies expressing an interest in SWIFT connectivity, from mid-sized corporates to the largest multinationals, including companies with a primarily domestic focus, low volumes and few banking relationships.
As the interview with Elie Lasker on Alliance Lite illustrates, SWIFT are focusing on solutions for smaller companies, but there are alternative approaches in which an increasing number of corporates are already expressing an interest, such as service bureaus, member/concentrators and packaged solutions provided by some banks. In France in particular, there is a growing appetite amongst mid-sized corporates for a cost-effective, bank-independent connectivity solution to replace ETEBAC 5 as it is retired over the next few years.
With this theme, one of the most interesting sessions at Sibos was a panel on the subject of “SWIFT for mid-sized corporates”. In this article, we provide a précis of some of the key observations and experiences articulated by the panel.
Olivier Brissaud, Chairman of the EACT Board and Treasurer of Volkswagen Group Services S.A.
Lionel Garnier-Denis, Group Treasurer, Alten
Jean-Louis Glorian, Head of Bank Services – Large Corporates, Crédit Industriel et Commercial
Marcus Treacher, Head of e-commerce, Global Transaction Banking, HSBC
Luc Meurant (Moderator), Head of Corporate Access, SWIFT
Lionel Garnier-Denis, Alten
Lionel shared his experience of connecting with his banks through SWIFT, which he summarised as ‘Few Banks, Lots of SWIFT’. Alten is a hi-tech engineering and consulting company with 12,000 employees, 87% of which are high-level engineers. In 2007, the company’s turnover was €701.2m, 25% of which was derived from international operations.
Alten Europe has over 30 entities across Europe, including Central & Eastern Europe, and Alten Finance has more than 10 entities in other parts of the world. The company works with five banks in France and 12 across Europe, with around 50 bank accounts. Cash is centralised through a pan-European cash pooling arrangement and payments are also conducted centrally. Before implementing SWIFT, Alten used ETEBAC 3/5 and Isabel for banking communications managed by a team of four in Group Treasury.
Alten’s Treasury department has a number of different projects under way, including introducing a new treasury management system (TMS) to provide the company with a greater range of functionality and provide scope for expansion as Treasury’s needs change over time. Alongside this project, the decision was taken to update the bank communication software to put in place a simpler solution which was consistent across banks, and to introduce a standardised approach to payment security. With the combination of a new TMS and bank communication software, the aim was to reinforce the centralisation of both treasury functions and payments.
Although Alten is smaller than many corporates which have connected so far, the company made the decision to use SWIFT for its bank connectivity. There were a variety of reasons for this: firstly, SWIFT connectivity is highly flexible and as the network through which banks communicate globally, it was more of a ‘future-proof’ option than alternative solutions. All types of payments and formats are supported, providing significant versatility. All of Alten’s banks could be reached via SCORE, and connection and maintenance could be outsourced to a service bureau, avoiding the need to provide specialist support internally.