1. Sibos 2010 Amsterdam Accord - Update & Case Study Jan Dings, SWIFT Dennis Sweeney, Newedge Group UK Branch 25 October 2010

2. Accord overview…...and then there were two! SWIFT’s confirmation matching service One of the first financial SaaS (Software as a Service) Covering 2 areas –Accord for Treasury (MT 3xx/600) –Accord for Securities (MT 515) Radically different models, one shared infrastructure

3. Accord: A Family of Services Same infrastructure – different service structure TreasurySecurities Flow model Messages exchanged between the parties, are copied to Accord Both parties submit messages directly to Accord Choice Individual: each party takes own decision as to how matching is done (Manually, on Accord, or on local application) Collective: both parties must be Accord users, to obtain a match Reporting / integration Exclusively Real-Time, in pull mode GUI for operators InterAct based API, for integration Real time towards GUI FIN-based reports at 15 minutes intervals for integration in back-office applications (push mode)

4. Accord for Securities - Short Intro

5. Accord for Securities – Prime/Executing Broker Solution for hedge fund transactions Hedge Fund Executing Broker Prime Broker Daily Trade report 1. Automated pre-matching, 2. Real time status updates + exception handling on GUI + full reporting in MT 998 4. Settlement OK MT515 MT 998 Custodian Agent CSD (PSET) 2. Real time status updates + exception handling on GUI + full reporting in MT 998 3. PSET agents’ local code is x-ref to a BIC in Accord Accord

6. Broker Global Custodian Local Custodian Local Custodian CSD Settlement OK [3] [1] [2] 1.Broker A trades off exchange with Broker B 5.Accord sends match status updates via (MT998) [5] [6] 7.CSD agents’ local code is x- ref to a BIC in Accord 2.Broker A copies trades + settlement info in MT 515 3.Broker B copies Trade & Settlement details in MT 515 4.Accord matches (MT 515) to (MT 515) [4] [5] 6.Brokers instruct settlements (MT 54x) [6] [7] Broker Accord X-ref table Accord MT515 MT 998 Accord for Securities – Broker to Broker Solution for off exchange transactions

7. Accord for Securities – Upcoming Development Feeding Central Counterparties (by Q2 2011) LCH.Clearnet SWIFT Messaging Accord Off-exchange Trade Confirmation to Accord + match status to Broker Matched trade details to CCP SIX x-clear EuroCCP Broker Confirmation to Accord + match status to Broker Broker

8. Accord for Treasury - UPDATE

9. Accord for Treasury Single-slide overview Accord Subscribers (>475 in 70 countries) Banks Brokers Custodians Fund mgrs Corporates (strong growth) Accord subscriber or non- subscriber Real-time reporting & exception handling Integration available for various Back-Office Systems Deal Confirmations: (MT 300,305,306,320, 330,340,341,360, 361,362,392, MT 600) Accord Real-time Confirmation Matching Service Availability of >99.97% last 5 years >90K msgs/hour observed matching capacity Common matching rules + user-defined rules Financial Liability for Matching results Copies of confirmations Copies of non-SWIFT data: fax, e-mail, e-FX portals, Broker feeds, Reuters, etc. SWIFT

10. Exception Handling using Graphical Interface Archive Access (e.g. auditor) Back Office Integration using XML-based API Accord Central Server SWIFT Alliance Gateway Live DB: confirmations, matching results, operator actions, history, audit trail Long Term Archival: 11 year online archive Accord Central Server Alliance Access or Branches / Headquarter accessing their own data, or dividing the work between them GB AE DE Connectivity: direct or via Service Bureau Accord for Treasury Accord from the customer’s perspective

11. Accord Update and Case Study - Sibos 2010 Total overhaul will start in 2011 – research phase ongoing. Mission: create the best possible matching system Accord for Treasury Product Evolution

12. Accord for Treasury – Update 2010 1/4 New Functionality Release 35.0 (March) Various matching fine-tunings: in MT 300, 306, 320, 330 Support for NDFs –User-defined rules on 77D –Searching on NDF details Matching Comments: include full mis-match reasons, origin of matched status Various GUI enhancements: e.g. extended “easy search”, enhanced End of Shift Reports, sample chaser templates...

13. Accord for Treasury – Update 2010 2/4 Extending Accord into Commodities MT 600: Commodity Trade confirmation –Traditionally limited to Gold/Silver, the Standard for MT 600 now allows for base metals, palm oil –Avoid confirming commodity trades with MT 300 containing CCY code XAU! Matching on Accord scheduled for delivery in Q4 2010 –Matching rules agreed with members of a Commodities working group Same architecture as Accord for Treasury: messages exchanged with counterparty, and copied to Accord

14. Accord for Treasury – Update 2010 3/4 Multi-matching for allocations Sophisticated Many-to-Many matching for complex allocation scenarios Optional Accord add-on module, currently tested with leading FX Broker Capable of: –Assigning matched status to sets of n messages sent with m messages received, for the same trade, where the two parties involved indicated the allocation in different ways –Interpreting reversed trades sent by one party as equivalent of cancellation sent by other –Flexible rounding mechanism –Very user-friendly reports

15. Accord for Treasury – Update 2010 4/4 New Training and Consultancy offerings New customers joining Accord service Accord Business Training for New Users Refresher consultancies Accord refresher (staff rotation, new functionality...) Accord for Supervisors (workflow, control, team optimisation) Making the most of Accord (less known, advanced features...) Usage optimisation Accord Health Check - Optimise your Treasury Operations Rich usage statistics generated & explained by Accord expert Peer comparison + own evolution Pinpointing internal / external root causes + action plan to address problems 3 year contract NEW!

16. Accord for Treasury – Plans for 2011 Preparing for the total overhaul Further GUI enhancements GUI migrated to WebPlatform to ease installation: 1 single, serving all users SAB-1 Accord GUI-1 SAB-2 Accord GUI-2 SAB-3 Accord GUI-3 SAB-... Accord GUI-... Web Platform Accord GUI

17. Accord for Treasury Case Study - Newedge

18. Newedge Case Study Timeline -1 3Q-4Q 2007: Initial contacts with Fimat. Contract with matching solution up for renewal early 2008. Advantageous Accord pricing through traffic aggregation with Société Générale group January 2008: –Fimat becomes Newedge –Accord activated in parallel with existing solution –Newedge allocation pattern requires immediate specific solution –SWIFT designs and delivers semi-automated solution February 2008: –Solution validated – tested in parallel with previous solution, Accord appears to be significantly faster –Accord + Excel program becomes standard solution

19. Newedge Case Study Timeline -2 Q2-2008: Accord Brick Pricing introduced. Cost of matching FX/MM Accord drops drastically for larger customers / groups 2009: Fully automated “Multimatching” solution designed in discussion with Newedge 2010: Gradual overhaul of Newedge SWIFT infrastructure – Multi-Matching solution developed for new infrastructure September 2010: Fully automated version deployed at Newedge, realising significant further efficiency gains

20. MultiMatching Programme Features and demo A standalone, fully automated black box program using Accord API For allocated trades: assigns matched status to sets of n MT300 sent with m MT 300s received, for the same trade Understands reversed trades sent by one party as equivalent of cancellation sent by other Flexible rounding mechanism Very user-friendly reports

21. Overview of un-matched items, including allocations

22. NEWGGB2LXXX Execute the multi-matching application

23. NEWGGB2LXXX Multi-matched (allocated) items disappear from the list of items that require manual intervention

24. NEWGGB2LXXX PDF reports are available and provide a full audit trail

25. Questions & answers ?

26. Thank you

27. 27 The colour palette Use the defined colour palette Don’t use other colours or fill- effects The standard font colour is black Use Oxblood red to emphasise text Primary colours Supporting colours R 151% G 2% B 84% R 242% G 140% B 163% R 148% G 157% B 158% R 160% G 207% B 235% R 240% G 171% B 0% R 181% G 218% B 210% R 0% G 155% B 187% R 44% G 94% B 79% R 183% G 18% B 52% R 118% G 106% B 98% R 105% G 54% B 149% R 149% G 74% B 9% R 255% G 204% B 0% R 204% G 102% B 51% R 181% G 163% B 0% R 130% G 124% B 52% R 151% G 35% B 63% R 192% G 192% B 192% R 204% G 102% B 51% R 151% G 35% B 63%