The SWIFT global payments innovation initiative

The journey so far December 2015 January 2016 April 2016 June 2016 SWIFT gpi overview - October 2016

The SWIFT global payments innovation initiative - Page 2

The correspondent banking model is under pressure Customers and End customers increasingly demanding regulators push for better payments service Domestic payments going real-time Banks rationalize their Regulatory intensity and increasing costs correspondent banking networks Network rationalization Digital innovators offer Disintermediation new disruptive solutions Enhanced value proposition SWIFT gpi overview - October 2016

Objective: deliver a better customer payment experience “Before” “After” Traditional correspondent banking The SWIFT global payments innovation (gpi) initiative 1. Slow, can take multiple days 1. Fast(er) (start with “same day”) 2. Expensive, multiple deducts 2. Higher efficiency & less intermediaries 3. Secure and compliant 3. Secure and compliant 4. No transparency on cost and time 4. Transparent, with payments tracking 5. Convenient and ubiquitous 5. Convenient and ubiquitous 6. Open and inclusive (global reach) 6. Open and inclusive (global reach) The objective is to first fix these key pain points Note regarding prices: it will be at the discretion of each SWIFT gpi member to decide the pricing strategy vis-à-vis its customers, including other financial institutions SWIFT gpi overview - October 2016

The SWIFT global payments innovation (gpi) initiative Delivering the future of cross-border payments ̶ Proactively respond to evolving customer needs for more speed, transparency and traceability in cross-border payments ̶ New multilateral rulebook, initially focused on business-to-business payments ̶ Building on the foundation that banks provide in security, resiliency and compliance ̶ Delivering real-world innovation: building on existing platform, embrace new technologies along a strategic roadmap ̶ Global reach, collaborative industry-wide initiative, organised by SWIFT ̶ Open model, participation based on operational quality  Fast  Secure  Real-world innovation  Transparent  Resilient  Global reach  Traceable  Compliant  Open model SWIFT gpi overview - October 2016

SWIFT gpi concept Messaging technologies Accessible by any bank Still reach SLA rulebook non-initiative banks Core transaction banks Reaching any bank Tracker Directory Observer SWIFT gpi overview - October 2016 Value-added product suite

SWIFT gpi product suite Directory Tracker Observer • Providing operational info on gpi  End-to-end payments tracking database to  Business Intelligence dashboard showing members, BICs, currencies, cut-off times monitor progress of a gpi payment bank compliance with gpi SLA. • Essential reference data to calculate best  Allows to track a payment’s path in real  Ensure control, monitoring and gpi payment route time, obtain transparency on deducts and enforcement of SLA, and, consequently, confirmation that payment was credited service quality Availability Availability Availability December 2016 via SWIFTRef  Demo: Sibos  Approach to be finalised: Q4 2016  GUI: November 2016  Basic version: April 2017 • MT 199 / API: Q1 2017  Advanced version: Q4 2017 SWIFT gpi overview - October 2016

SWIFT gpi tracker “in the cloud” 101 > 103 > 103 > 103 > 910 > Originator Bank A Bank B Bank C Bank D Beneficiary MT199/API MT199/API MT199/API MT199/API “One-glance” Transparency of total fees and time status overview Unique, end-end tracking number Track path, in real time Central payments database, hosted at SWIFT Details of banks along Updated via MT199 or API the chain Data consumption via GUI, via MT199 (push) or via API (pull) SWIFT gpi overview - October 2016

SWIFT gpi customer credit transfer – Value proposition for corporates Key features Benefits for a corporate Faster, same day use of funds* Grow international business Transparency of fees Enhance supplier relationships End-to-end payments tracking Remittance information transferred unaltered Increase treasury efficiencies (*) within the timezone of the receiving gpi member SWIFT gpi overview - October 2016

SWIFT gpi customer credit transfer - Value proposition for banks Grow volumes Reduce cost Lead innovation • Offer distinctive payments service • Lower network management cost, • Reputational benefit • Retain and attract new customers avoid proprietary connections in • Leader in global payments • Protect and grow transaction non-strategic countries, access innovation volumes global quality network • Comply with regulation • Enhanced compliance practices (Dodd-Frank, PSD2, …) • Optimised intraday liquidity flows • Sell payments services to third • Increased straight through parties processing SWIFT gpi overview - October 2016

SWIFT gpi initiative banks 50% 30% Europe, Asia Pacific 1. ABN AMRO Bank 85+ Middle East, 62. Nordea Bank* 2. ABSA Bank Africa 63. Oversea-Chinese Banking Corporation 3. Alfa-Bank initiative banks 64. PKO Bank Polski 4. Australia and New Zealand Channelling payments 65. Promsvyazbank Banking Group* into 224 countries 66. Rabobank 5. Axis Bank 20% 67. Raiffeisen Bank International 6. Banco Bilbao Vizcaya Argentaria Representing 71% of all Americas 68. Resona Bank 7. Bangkok Bank SWIFT cross-border 69. Royal Bank of Canada* 8. Bank of America Merrill Lynch* payments Regional representation of 70. Royal Bank of Scotland 9. Bank of China* SWIFT gpi banks 71. Sberbank 10. Bank of New York Mellon* 72. Siam Commercial Bank 11. Bank of Nova Scotia 28. Commerzbank 45. ICICI Bank 73. Silicon Valley Bank 12. Bank of the Philippine Islands 29. Crédit Agricole 46. IndusInd Bank 74. Skandinaviska Enskilda Banken 13. Bank of Tokyo-Mitsubishi UFJ* 30. Crédit Mutuel-CIC Banques 47. Industrial and Commercial 75. Société Générale 14. Banco Santander 31. Credit Suisse Bank of China* 76. SpareBank 1 15. Banco de Crédito del Peru 32. CTBC Bank 48. ING Bank* 77. Standard Bank of South Africa 16. Banco do Brasil 33. Danske Bank* 49. Intesa Sanpaolo* 78. Standard Chartered Bank* 17. Banque Européenne d’Investissement 34. DBS Bank* 50. Investec 79. Sumitomo Mitsui Banking Corporation* 18. Barclays* 35. Deutsche Bank 51. Itaù Unibanco 80. Swedbank 19. Bidvest Bank 36. DNB Bank 52. JPMorgan Chase Bank* 81. Tadhamon International Islamic Bank 20. BNP Paribas* 37. Ecobank 53. Kasikornbank 82. TMB Bank 21. Budapest Bank 38. E.Sun Commercial Bank 54. KBC Bank 83. Toronto-Dominion Bank 22. CaixaBank 39. Erste Group Bank 55. KEB Hana Bank 84. UBS 23. Canadian Imperial Bank of Commerce 40. Fifth Third Bank 56. Lloyds Bank 85. U.S. Bank 24. China Construction Bank 41. FirstRand Bank 57. Mashreq Bank 86. UniCredit* 25. China Merchants Bank 42. Handelsbanken 58. Maybank 87. United Overseas Bank 26. Citibank* 43. Helaba Landesbank Hessen- 59. Mizuho Bank* 88. Wells Fargo* 27. Commonwealth Bank of Australia Thüringen 60. National Australia Bank 44. HSBC Bank 61. Natixis SWIFT gpi overview - October 2016 (*) Pilot bank

SWIFT gpi roadmap – Draft proposal  Focus  In pilot.  Final specs. with live service.  Optional  Build/Test – timeframe tbc  Set of additional optional services  Each with their own timeline  High-level info sent end July  More details after Sibos • Approach tbd SWIFT gpi overview - October 2016

SWIFT gpi v2 : The digital transformation of cross-border payments A Create value first Front-office of core banks Customers Digitized Core digital B customer transaction banks Reduce experience back-office Improved intra-bank cost operating model Third-party Renewed C Reduce organisations correspondent banking fundamental technology interbank Open access, new cost Enable D collaborative approach collaborative innovation SWIFT gpi overview - October 2016

Timeline 2015 2016 2017 Promote ▪ Identify drivers ▪ Go-live ▪ Define principles Pilot and show early results at Sibos ▪ Broad market ▪ Announce initiative adoption Define strategic roadmap/vision SWIFT gpi overview - October 2016 14

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