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SIBOS 2020: The financial world can include everyone, Citi boss says

By Sunniva Kolostyak

October 09, 2020

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The financial world is no longer an exclusive club for bankers, and it should welcome FinTech and BigTech players, Michael Corbat, CEO of Citi, said at SIBOS 2020.

In the closing keynote of the annual SWIFT conference, Corbat noted that if BigTech and FinTech felt like the financial arena was as much for them as for banks, they would not necessarily feel the urge to invent their own global currencies.

“I’m pleased to see some FinTechs and BigTechs taking part in this year’s conference, but we need to open the gates even wider because we are in a world of digital platforms, and those digital platforms will embed financial services, and it will take a broader collaboration between banks, FinTech and BigTech to make that happen. The opportunity is big enough for all of us. It’s not a zero-sum game,” he said.

Citi logoIn his speech, Corbat, who is retiring in February to pave way for Jane Fraser, addressed three concepts which he thinks need reconsideration due to the current global climate – reciprocity, equity and ownership.

Reciprocity, a lever used to evaluate whether institutions are receiving as much as they are giving in a transaction or relationship, should also be thought of as what we owe each other.

“We’ve long prided ourselves as agents of opportunity, as enablers of free enterprise, but now, more of us realise we have a larger obligation to deliver fairness in how we serve our customers, how we hire and how we compensate and promote talent,” Corbat said. He added that the industry must also pull together in the migration to ISO 20022 and build on recent collaboration in deploying SWIFT gpi.

When it comes to return on equity, the Citi boss noted that it is something that is said to measure financial performance but that it does not appear on the bank’s balance sheet.

“Equity is about the change we need to make to deliver social justice. I believe that if we can deliver equity in society, then the return will be a transformation in opportunities and a more inclusive, thriving economy,” Corbat said.

“When I think about return on equity, I’m not only thinking about my own institution but how we can all benefit if we can correct these historical injustices. For instance, one area we focus on at Citi, is equal pay for women. And I can tell you, the return on equity in this area is beyond measure for us.”

Corbat also said that there needs to be a change in the way we think about ownership and rather view ourselves as stewards.

Sibos logo“I believe deeply in the value of a strong work ethic and that people can get more satisfaction from taking work personally, but I also think there’s a big distinction between ownership and stewardship. If I asked you to act like the owner of a forest, you might be tempted to chop it down for timber. But if I asked you to be the steward of that forest, then you can’t help thinking in generational terms, and be concerned about what you’ll pass on to your successors.”

He added that financial institutions are stewards of the SWIFT ecosystem, and that change is needed to keep up with the demands of the 21st-century economy. As a result, everyone must transition to the ISO 20022 standards, move on from the world of fire-and-forget financial messaging, and fully embrace the new SWIFT platform’s capabilities.

Corbat said: “This is the time to go beyond incremental change and create something that’s truly future-proof and sustainable. To make us successful, the SWIFT community must be willing to make the investments in technology resources and infrastructure necessary to operate in a new, more dynamic way, with 24 seven availability. This is going to be key to the whole community, moving forward is one. And most important of all, we can’t fragment this community. There are many different arenas in which we compete, but this can’t be one of them.”

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