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Via discussions hosted on the Capco Institute Blog, members debate high profile issues, with frequent and provocative contributions from Capco thought leaders. For institutions around the world, how will the changing financial services landscape form the future of finance?

EMIR: The imminent OTC derivatives clearing obligation. Are you ready?

EMIR: The imminent OTC derivatives clearing obligation. Are you ready?

Author Tom Riesack Published August 14, 2014

Mandatory clearing of OTC (over-the-counter) derivatives in Europe will soon become reality under EMIR (European Market Infrastructure Regulation).

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Banking’s bright future in the cloud

Banking’s bright future in the cloud

Author James Monro Published August 13, 2014

Why the cloud? At first glance the advantages to financial institutions are clear: lower costs, faster reactions to competitors and regulators, and improved communication with counterparties, for seamless transaction execution.

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Change Management: Why banks need to implement Change Programs

Change Management: Why banks need to implement Change Programs

Author Lloyd Chapin Published August 08, 2014

It’s confusing, what’s going on with Wall Street right now. News is rife with cost cutting and massive lay-offs as revenues continue to fall due to low market volatility and drops in trading volume. Yet, the pressure to invest and spend is unrelenting as a result of the continuously strong S&P, generally favorable market conditions, the possibilities of emerging technologies, and the continuous regulatory mandates. This pressure to invest and spend is feeding banks’ appetites to continue to grow professionals who can strategize, visualize, communicate, and implement massive Change Programs. Cut costs or invest? How can a financial institution simultaneously do both?

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Contactless payments take-off in Slovakia

Contactless payments take-off in Slovakia

Author Il'ja Ilit' Published July 22, 2014

From a cold start to a bright future in less than six years! In 2008, a well-respected analyst house reported that “Europeans show little interest in contactless payments”. However, in 2013-2014, the two biggest card associations confirmed that contactless transactions had trebled and that spending had increased six-fold. So who is successful and why?

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Don’t let payments fail to fulfill their potential

Don’t let payments fail to fulfill their potential

Published July 18, 2014

The age of payments as a ‘cash cow’, is about to end. Migration to new systems, a reduced operational cost base and total focus on innovative revenue drivers are essential to protect, stabilize, and grow revenues. It all adds up to a shift in focus: beyond compliance to concentrate on the needs of the business.

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EMV transfers fraud liability from card issuer to merchant

EMV transfers fraud liability from card issuer to merchant

Author Vince Forte Published July 09, 2014

The US is finally deciding to play catch-up with the rest of the world and begin working towards the adoption of the Europay, MasterCard, and Visa standard for secure payments (EMV). With the October 2015 liability shift looming and the devastating fallout from Target’s data security breach in 2013, the rollout of chip and pin securitization has shifted from neutral into drive.

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Blue Sheet Blues: Regulators renewed interest in total transparency

Blue Sheet Blues: Regulators renewed interest in total transparency

Author Michael Drews Published July 07, 2014

There is nowhere to hide from regulators determined to drive Wall Street trading toward total transparency, and the last round of industry fines is a wake-up call to action. On June 4, 2014 The Financial Industry Regulatory Authority (FINRA) fined major banks (including Barclays Capital Inc., Goldman, Sachs & Co., and Merrill Lynch), $1 million each for failing to submit complete and accurate, detailed information concerning trades performed by the firms, and for their customers, warning that failure to correct the problem could, in no uncertain terms, lead to suspension or expulsion from the securities industry.

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Living Wills on life support

Living Wills on life support

Author Michael Bertran Published July 02, 2014

July 1, 2014 came and went with an eerie silence for banks waiting for some type of acknowledgement or guidance from regulators regarding the latest deadline for revised Living Wills. Seemingly buried under the glacier of regulatory reform building up on Capitol Hill, agencies are bobbing dangerously on the surface of the sea of reform and may be unable to comment on Living Wills directives again this year.

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Being yourself at work and true inclusion

Being yourself at work and true inclusion

Published June 26, 2014

Inclusion in today’s workplace is moving beyond joining ethnic, LGBT or any other networks covered by the Equality Act. Proactive companies define it as diversity of thought, values and interests. ‘Being yourself at work’ may be the best way to describe it. However, when taking down barriers and opening up new freedoms of self-expression in the workplace, one aspect that shouldn’t be overlooked is our interactions with others and how what we say and do affects people.

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Swap futures: Why should the buy-side care?

Swap futures: Why should the buy-side care?

Published June 23, 2014

True or false? In the post-EMIR landscape, insurance firms and pension funds are likely to face increased cost from mandatory clearing and margining of their interest rate swaps in order to hedge interest rate risks on their long-term liabilities.

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Digital banking: Eclipsing the branch, enticing customers?

Digital banking: Eclipsing the branch, enticing customers?

Published June 19, 2014

It’s all over the news. Around the world, banks are closing branches and more plan to follow suit. Their reasoning? “Digital is taking over”. However, this presents its own set of challenges. How do banks address them so that they reduce their number of branches, while still delivering compelling service offerings?

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The UK’s Seven-Day Account Switching Rule: Customer empowerment or customer indifference?

The UK’s Seven-Day Account Switching Rule: Customer empowerment or customer indifference?

Published June 17, 2014

The UK’s new seven day account switching rule, introduced last year, has important implications for customers and banks alike. But does it really herald a revolution in customer relationships in the financial services sector?

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Recovery and Resolution Transformation

Recovery and Resolution Transformation

Published June 11, 2014

For financial institutions with vision and long term planning capabilities, there are real opportunities to turn a supremely tough regulatory compliance exercise into a key business driver.

In the first of a series of blogs on the scope and advantages of the Recovery and Resolution Transformation approach for European RRD (Recovery and Resolution Directive) cases, we take a look at the Big Picture and examine why a more visionary perspective than ‘compliance only’ is urgently needed.

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Payments – time to revitalize a key revenue stream

Payments – time to revitalize a key revenue stream

Published June 04, 2014

Payments need to be profitable once again, as well as compliant. The good news is that they can be.

Granted, payments are not the dependable cash cow they once were – a guaranteed profit producer, easy to maintain on a bed of legacy technology. The game is far from being over however. Making payments pay may be a challenge. But it’s by no means out of reach.

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Act now on transfers before the regulators act on you

Act now on transfers before the regulators act on you

Author Richard Plumb Published June 02, 2014

Despite a significant rise in the number of affluent investors, the wealth management industry’s track record of keeping its customers happy is still poor. One of the key problems affecting customers of execution-only brokers, for example, is the cost and complexity of transferring investment products between providers. It seems likely that the wealth industry regulators will follow retail banking in making switching rules quick and simple for their customers. Are wealth managers doing their bit in making this happen?

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Part 3: How much is central clearing really costing you? Cost Reduction

Part 3: How much is central clearing really costing you? Cost Reduction

Published May 29, 2014

In today’s regulatory environment, revenue is not the only factor with an impact on profit margin. In fact, cost is becoming a more important driver in profitability. To comply with central clearing mandates and maintain a sustainable clearing business, banks/dealers need to take a closer look at their clearing operations, especially the cost structure. And some might be surprised by what they find.

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It’s Time to Build “The Relevant Bank”

It’s Time to Build “The Relevant Bank”

Author Nic Parmaksizian Published May 21, 2014

The Relevant Bank concept challenges attempts to finish the roof before starting the foundations. What does being The Relevant Bank actually mean? First and foremost, it means being relevant personally – offering products and services consumers want, at the moments and through the channels they prefer.

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Part 2: How much Is central clearing really costing you?

Part 2: How much Is central clearing really costing you?

Published May 20, 2014

Given membership requirements, not every firm qualifies to be a direct member of a CCP. Some banks/dealers set up infrastructure to offer the clearing services to those that can only qualify as indirect members. There is no secret in the industry that the clearing business is generally not a revenue generator but helps to build and maintain client relationships. Again, cost is crucial in ensuring a sustainable business model.

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Part 1: How much is central clearing really costing you?

Part 1: How much is central clearing really costing you?

Published May 19, 2014

In the new world order of mandatory central clearing, for the banks to preserve their profit margin, it is imperative to understand the cost of clearing. However, this can be daunting task given that:

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Around the Clock Tweeting

Around the Clock Tweeting

Author Tom Race Published May 15, 2014

Banks continue to increase their social media presence, especially on Twitter. But for all the talk of 24/7 omnichannel experiences, the number of institutions offering a genuine round the clock, real-time Twitter service to customers remains small. For today’s social-media savvy customer, that simply isn't good enough.

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