How did you first get into the financial services industry? Is that what you always wanted to do?
I got into financial services 20 years ago, when I began my career at Goldman Sachs in the equities middle office. Financial services was completely new to me, but I knew the Goldman Sachs name, and knew it was a place that I wanted to be.
I grew up in a family that ran a small business in Rochester, New York. That experience gave me a real appreciation for hard work and the complexity of running a small business. My first job, as a high school student, besides working in my family’s business, was at a bingo hall, where I had my first customer service role selling lottery tickets. It taught me a lot about soft skills and how to engage with all types of people.
The combination of hard work and client service was the foundation for my role at Goldman Sachs. Starting in middle office operations was ideal for me, because it gave me a birds-eye view into how the industry worked and functioned. In fact, the knowledge I learned in my first few years at Goldman Sachs is something that carries me today.
What were your first impressions when you entered the financial services industry?
The complexity and fast-paced nature of financial services was both thrilling and daunting when I first entered the industry. That, coupled with the talent that surrounded me at Goldman, in many ways forced me to work incredibly hard to learn and master my first role.
This level of domain expertise enabled me to differentiate myself and be called upon when opportunities presented themselves – such as when the firm wanted to create a broker/dealer in Brazil.
How has the industry changed since you first started compared to now?
Even when I first started out, the industry felt like it was in constant motion, and that certainly has not changed at all – in fact it has probably even gathered pace. By this, I mean the speed of technological advancement, the evolution of the markets, and the regulatory environment. These days, with the increasing levels of post-trade automation that have been implemented, everything happens faster and with more transparency, ultimately benefiting market participants and their underlying clients. Much of the increase in automation has been necessitated not only by growing volumes and volatility, but also by regulatory mandates which have required greater efficiency in post-trade operations – the US move to T+1 is a great example of this. While we have made much progress as an industry, we are constantly striving to find new ways to improve markets.
You have been at DTCC a year now, how have you found it?
It has been an incredibly rewarding year. DTCC is a cornerstone of the financial markets, and the work we do is vital not only for our clients but for the stability of the entire financial system. One of the major highlights has been the successful transition to T+1 settlement. This was a huge undertaking that required intense coordination, including testing, client outreach, and engagement to make sure the industry was ready.
The results have been impressive: the industry continues to affirm nearly 95 per cent of transactions by 21:00 ET on trade day, and custodian affirmations increased from 60 per cent to 85 per cent within just six months.
FICC has also experienced tremendous growth, with the Sponsored Service seeing nearly 100 per cent year-over-year growth.
The Government Securities Division (GSD) hit a record US$9.2 trillion in daily activity on 3 September, a testament to how FICC’s flexible models are helping more participants access central clearing.
Looking ahead, the expansion of US Treasury clearing is a major priority for us. With deadlines fast approaching, DTCC is fully committed to a successful implementation, and we have filed several rule changes aimed at improving market access and risk management. We are also working closely with the industry to educate members on the impacts and preparations needed to ensure a smooth transition. At the same time, we are continuing to collaborate with our clients and others to evolve our offerings, such as our cross-margining arrangement with CME — to help firms comply with the mandate in the most cost-effective manner possible.
What have you found different about working at DTCC compared to Goldman Sachs where you spent close to two decades?
Joining DTCC was a natural evolution for me. When I was at Goldman Sachs, I was a client of DTCC so I spent a lot of time collaborating with the organisation, and in doing so, I got a really good understanding for its people and its culture. Everyone I met were talented and genuine people.
At the same time, I was intrigued by the opportunity to bring my learnings and experience on the client side to such a critical organisation — given its role at the centre of the markets. It is an incredibly unique and interesting place to be, and you are already seeing the results of this in some of the efforts we are focused on such as T+1 and expanded US Treasury clearing. I think my work at Goldman Sachs prepared me well for the position I now hold at DTCC.
What are some of the biggest challenges you have faced in your new role at DTCC?
I mentioned it already, but the shift to T+1 settlement in the US in May this year was the biggest initiative of the past 12 months, for DTCC and the industry.
The real challenge was making sure that everyone – from the largest financial institutions to smaller market participants – were ready to operate under accelerated timelines.
The move to T+1 emphasised the need for ongoing education and support in the market, as accelerated settlement impacts how firms manage liquidity, optimise collateral, manage the trade process, and handle their day-to-day operations.
In the last year, we have also been working with the industry to prepare for major changes in the US Treasury market and Basel III Endgame rules. For the latter, new capital requirements are forcing banks and other financial institutions to take a hard look at their balance sheets and rethink which businesses they want to support. This, in turn, has a ripple effect on the clearing and settlement space, as firms look for ways to ease their capital burdens, which could influence transaction volumes and market liquidity. We are actively working with our clients to identify new ways to improve our solutions, including in partnership with others, to enable our clients to maximise capital while complying with mandates.
What trends are you seeing in the clearing, settlement, and trade reporting space?
There has been a significant focus on data management and real-time reporting. As regulation evolves and becomes more prescriptive, firms are using advanced analytics and automation to stay compliant as well as to stay competitive. At the same, as firms modernise and add greater levels of digitisation to deliver new capabilities and functions, cybersecurity remains top of mind. It is important that, as an industry, we work collectively and keep resiliency and risk management at the top of every agenda.
You were recently appointed to the ISSA board, what would you like to achieve whilst a member of the board?
I was very pleased to be asked to join the board earlier this year and I look forward to working with my fellow board members to advance the International Securities Services Association’s (ISSA’s) work in helping to shape the future of the global securities services industry. DTCC is well placed to support ISSA’s mission and provide input on shared objectives such as asset servicing, operational resilience, DLT and T+1.
One of the biggest concerns across all sectors in the industry is how to develop the next generation of talent. How do you use your expertise to help guide the next generation?I think it is incumbent on all managers to ensure they are building the pipeline of tomorrow, by helping them grow their individual skills and careers through knowledge sharing, guidance, coaching, and mentorship. For me, it is understanding the talent that is coming into the workforce and how that may be different from the generations prior in terms of motivating factors, technical acumen, work life balance, social responsibility, and more.
The role we play as mentors, sponsors and motivators for the leaders of the future is incredibly important in not only maintaining the integrity of our industry, but in shaping the evolution of what is to come. I personally find such gratification from empowering a sense of entrepreneurship in the next generation through enabling an apprenticeship culture from those with domain expertise and experience. The baton will not be passed in the same way it has been in the past – we need to evolve our approach.
Where do you see yourself and your career in 10 years’ time? How will you, your career, and the industry have changed in that time?
10 years? A lot will probably change, and a lot may stay the same. I will be excited to see how the further modernisation and digitisation of markets, infrastructure and processes evolve and how we truly change the way financial markets operate – delivering soundness, safety, and increased value. I also anticipate that data will become increasingly important to how firms strategise, make business decisions, and ultimately thrive. Data, when harnessed, can transform financial markets.
In addition, it will be interesting to see how the industry advances the use of digital assets. For example, the tokenisation of financial instruments could enable us to further democratise financial services, and DLT and smart contacts have the potential to power a network of networks to eliminate the inefficiencies that exist between different players in the current ecosystem.
At the same time though, the industry will, of course, stay deeply committed to risk management and resiliency, continuing to protect clients and the markets. It is an exciting time to be in financial services, and I can not wait to see what we will collectively achieve.
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State Street
Jeff Sardinha
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