SWIFT messages key for intra-day liquidity reporting
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SWIFT messages key for intra-day liquidity reporting 09 October 2015Brussels Reporter: Mark Dugdale
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The payments market practice group (PMPG) has backed the use of SWIFT messages for intra-day liquidity reporting to meet Basel Committee on Banking Supervision (BCBS) requirements.
The group, which is made up of industry experts from the world’s leading banks, endorsed the use of SWIFT messages for intra-day liquidity reporting following an industry-wide consultation.
SWIFT messages underpin a rulebook created by the liquidity implementation task force (LITF) to support compliance with BCBS requirements.
The LITF, made up of 25 clearing banks, custodian banks and global brokers, aims to establish a common set of global best practices in the nostro and custodian space for the use of SWIFT intra-day liquidity reporting messages.
The LITF Global Market Practice Guidelines, also endorsed by the PMPG, address the challenges to be overcome in data collection to comply with BCBS 248, which calls for banks to implement monitoring tools for intra-day liquidity management by January 2017.
Under BCBS 248, banks must report retrospectively on their intra-day liquidity flows.
“To support the BCBS 248 requirements, SWIFT’s reporting messages are the predominant source of data,” said Michael Knorr, head of payments and liquidity risk management at Wells Fargo and a PMPG member.
“Having a very clear best practice on the use of intra-day reporting messages is an essential tool that will enable banks to collect the necessary data in support of the regulatory requirements across different jurisdictions.”
Catherine Banneux, senior market manager for banking at SWIFT, added: “Since the publication of the BCBS monitoring tools, SWIFT has seen a 30 percent increase in its liquidity reporting messages. We expect the guidelines, along with the support of the PMPG, to help increase usage and close the remaining data gaps.”
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