12 SepHe who aggregates data wins. Stuff worth knowing from The Bankers’ Plumber

Mastering data is difficult. You could easily get lost amongst the buzzwords; digital, pull, Big Data, APIs, PSD 2.

In a recent post, I commented on the need for financial services firms to think beyond the must do regulatory stuff of PSD 2 which forces them to open up their data for third parties to come and collect on behalf of mutual clients.

Thinking beyond the must do boils down to one simple challenge; do you want to and can you position your institution to be the data aggregator, to be the bank that allows that clients are multi-banked and offers them the resources to easily aggregate the review and management of those assets?

Switzerland is hugely important in wealth management and it is also showing some very encouraging signs of wanting to lead in matters digital and crypto. In recent weeks, a couple of announcements in the Swiss press have re-enforced what was “my humble opinion” about the role of the aggregator. They are worth noting.

Jan Schoch is CEO of Leonteq, a Swiss bank specialised on structured products and providing a platform for other banks to use. Schoch has put some of his considerable smarts and his money into a new venture, Flynt, which recently won a banking licence. Flynt is all about creating a platform for wealth management; see Flynt Eyes Uber or Google Moment. “.. Flynt has no own products, nor will it sell third-party ones or advise clients – not a traditional wealth manager then.”

A Credit Suisse alum, Arthur Vayloyan, was until recently Head of Products at Zurich’s Falcon Bank. There the bank was preparing to launch an innovative multi-custody product Aggregation again. Click here for article, though it is in German and ignore the headlines about the management changes.

Lessons to be Learned

Market practitioners are seeing a role for the data aggregator.

Mastering the role of aggregator requires a lot of hard work to ensure consistency. One custodian may report using one specific instrument identifier, for example the Bloomberg code; the aggregator has to recognise the type and then have the data, even though it may itself prefer to use, say, ISIN. What do you do if a feed arrives and the you do not have the data?

Like threading the proverbial fat man through the eye of the needle; can be done, requires careful planning. Those that can master data challenges and deliver data quality will be able to add value.

About the Author: I help banks master their post trade processing; optimising, re-engineering, building.

I understand the front-to-back and end-to-end impact of what banks do. That allows me to build the best processes for my clients; ones that deliver on the three key dimensions of Operations: control, capacity and cost.

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Publications

The Bankers’ Plumber’s Handbook

Control in banks. How to do operations properly.

For some in the FS world, it is too late. For most, understanding how to make things work properly is a good investment of their time.

My book tries to make it easy for you and includes a collection of real life, true stories from nearly 30 years of adventures in banking around the world. True tales of Goldman Sachs and collecting money from the mob, losing $2m of the partners’ money and still keeping my job and keeping an eye on traders with evil intentions.

So you might like the tool kit, you might like the stories or you might only like the glossary, which one of my friends kindly said was worth the price of the book on its own.  Or, you might like all of it.

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Cash & Liquidity Management

An up to date view of the latest issues and how BCBS guidance that came into force from Jan 1 2015 will affect this area of banking. Kindle and hard copy.

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