Facts about SWIFT for the media

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					Facts about SWIFT for the
media

SWIFT Press Office
July 2010
Table of contents
Company facts ................................................................................................................................... 2
       What is SWIFT? ........................................................................................................................... 2
       Why was SWIFT created? ........................................................................................................... 2
       Who founded SWIFT? ................................................................................................................. 2
       Who owns SWIFT? ...................................................................................................................... 2
       Where is SWIFT located? ............................................................................................................ 3
       Is SWIFT a financial institution? .................................................................................................. 3
       Is SWIFT regulated? .................................................................................................................... 3
       Are SWIFT’s customers supervised? .......................................................................................... 4
       How is SWIFT managed? ............................................................................................................ 4
Customers .......................................................................................................................................... 5
       Who can use SWIFT? .................................................................................................................. 5
       What value does SWIFT deliver to customers?........................................................................... 5
Technology......................................................................................................................................... 6
       What are the main network components? ................................................................................... 6
       How does SWIFT ensure data security? ..................................................................................... 6
       What types of financial messaging does SWIFT provide? .......................................................... 7
       What are business solutions? ...................................................................................................... 7
       What is a SWIFT message standard? ......................................................................................... 7
       What is a BIC (also called SWIFT code)? ................................................................................... 8
SWIFT and the community ............................................................................................................... 9
       Why does SWIFT call itself a community? .................................................................................. 9
       What is Sibos? ............................................................................................................................. 9
       Corporate social responsibility .................................................................................................... 9
Latest facts and figures .................................................................................................................... 9
Press contacts ................................................................................................................................. 10




Facts about SWIFT for the media -- July 2010                                                                                                          1
1 Company facts

1.1 What is SWIFT?
       SWIFT stands for Society for Worldwide Interbank Financial Telecommunication.
       SWIFT is the financial industry’s cooperative. It provides the global financial community
       with a highly secure and reliable network to exchange electronic financial messages.
       The essential components of the SWIFT system are:
       o An electronic messaging service spanning 209 countries enabling financial institutions
           to exchange data securely, reliably and quickly.
       o Message standards for the financial industry. By providing standardised messages,
           SWIFT enables financial institutions to automate their data processing, thereby
           lowering operational risks, cutting costs and improving efficiency in their businesses.
           Standards also serve as a common business language.


1.2 Why was SWIFT created?
       Banks created SWIFT in 1973 because of a need to process financial transactions
       efficiently. In the early 1960s, international banking transactions started to exceed the
       capacity of paper-based clerical handling procedures. So banks turned to computer
       technology, but the downside of this was the growth of competing systems and
       incompatible systems, and conflicting procedures, which soon rendered the exchange of
       messages between banks and countries complex and inefficient.
       Banks were quick to recognise the benefits of a shared IT platform, shared procedures and
       a common business language and in less than 10 years SWIFT became the de facto
       messaging service for the global banking industry.
       Other sectors of the financial industry also rapidly recognised the benefits. Since 1987,
       SWIFT has opened up to non-bank financial institutions such as securities firms, fund
       managers and since 2000 to banks’ corporate customers.


1.3 Who founded SWIFT?
       In May 1973, 239 banks from 15 countries created the SWIFT cooperative to build a
       common messaging system.
       In May 1977, the messaging system clicked into life. Six months later, membership had
       more than doubled to 518 banks.
       Today, SWIFT has more than 9,300 users and its network spans 209 countries. Customers
       exchange more than 15 million messages daily.


1.4 Who owns SWIFT?
       SWIFT is a cooperative organisation owned by its users. Its cooperative structure enables
       its shareholders and its users to influence the company's activities for their collective
       benefit.
       More than 2,300 of its 9,000 users are shareholders and are called ‘members’. Members
       vote at the annual general meeting, elect the 25 Board members and shape company
       strategy. The remaining users are financial institutions, financial service providers and



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       corporates, which do not meet the shareholder eligibility criteria or are subsidiaries of
       SWIFT members.


1.5 Where is SWIFT located?
       SWIFT is a Belgian company with headquarters near Brussels. It employs 2,000 people
       worldwide, of whom half are in Belgium
       SWIFT has 20 offices in the world’s major financial markets
       SWIFT has three data centres on two continents and four service centres to ensure fail-
       safe operations 24/7


1.6 Is SWIFT a financial institution?
       SWIFT is not a financial institution because it does not provide financial services nor hold
       client accounts or assets. Its role is solely to transport data securely, reliably and
       confidentially between the financial institutions and corporations connected to its private
       messaging infrastructure.


1.7 Is SWIFT regulated?
       Central banks are responsible for fostering financial stability and ensuring the soundness
       of financial infrastructures. Since SWIFT is an important provider of services to the
       financial industry, the central banks of the G-10 countries oversee SWIFT. The National
       Bank of Belgium (NBB) ensures lead oversight on behalf of the G- 10 central banks because
       SWIFT is a Belgian company.
       Oversight focuses primarily on the security and operational reliability of SWIFT's
       infrastructure. The objective is to ensure that the appropriate structures, processes,
       management procedures and controls exist to manage effectively the risks the SWIFT
       network may pose to financial stability and the soundness of financial infrastructures.
       SWIFT is subject to the laws of the countries it operates in, when applicable to its
       activities.
       SWIFT’s diverse membership means it is independent and apolitical. Some observers have
       likened it to the ‘United Nations of the financial industry.




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1.8 Are SWIFT’s customers supervised?
       The central banks or banking and financial regulators in the countries in which they
       operate supervise the activities of regulated SWIFT customers. They are subject to national
       and international regulations governing money laundering and they have a duty to know
       their customers, check their identities, archive information and report suspect financial
       transactions to their controlling authorities.
       Connecting to SWIFT does not give uncontrolled nor unlimited access to every institution
       on the network. The financial industry operates through bilateral business relationships. It
       is the responsibility of the institutions entering into such relationships to check the
       credentials of their correspondents. SWIFT provides security mechanisms, which enable
       users to identify themselves to selected correspondents and sign their messages
       electronically.


1.9 How is SWIFT managed?
       The SWIFT Board of Directors delegates day-to-day management of the company to the
       Chief Executive Officer (CEO). The CEO chairs an Executive Committee formed by the CEO,
       the Chief Financial Officer (CFO), the Chief Information Officer (CIO), the Head of
       Marketing, the Heads of the three Regions and the Head of Stakeholder Relations. (Further
       details).
       The SWIFT Board decides on a majority basis. Its 25 members are country representatives.
       The SWIFT community of one or more countries elects its representative, who they
       mandate to defend their collective interests. Board members never represent a specific
       financial institution.




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2 Customers

2.1 Who can use SWIFT?
       Usage of SWIFT is restricted to financial institutions, market infrastructures and their
       corporate customers. To join SWIFT and connect to its network, a prospective financial
       institution or corporation must comply with strict admission criteria and be approved by
       SWIFT’s Board of Directors. The criteria are transparent and identical for every institution
       worldwide and are published on our website www.swift.com. Private individuals do not
       have access to the network.
       Our users include banks, broker-dealers, custodians, investment managers, payments
       providers, stock exchanges, securities depositories and global, national and domestic
       market infrastructures for securities and payments (EBA; TARGET; CHAPS; CREST; STRATE;
       ECSDA; Euroclear; CLS etc.)
       Corporations may also connect to SWIFT to exchange financial information with their
       financial institutions thus benefiting from one standardised communication platform, as
       opposed to multiple connections with multiple banks.
       The Treasury departments of most of the world’s Top 600 companies use SWIFT
       messaging services.




2.2 What value does SWIFT deliver to customers?
       SWIFT enables its users to exchange automated, standardised financial information
       securely and reliably, thereby lowering costs, reducing operational risk and eliminating
       operational inefficiencies.
       SWIFT messaging is reliable and secure. It has built a relationship of trust with its
       customers by achieving network and system availability of 99.999% and it guarantees the
       delivery of messages. SWIFT has elaborate contingency plans and uses features such as
       passwords, authentication of its users and authentication of the message content, data

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       encryption, audit tracing and intrusion detection to ensure data confidentiality and
       integrity.
       By combining a secure messaging service and shared message standards, SWIFT enables
       financial institutions to automate their data processing, thereby lowering operational risks,
       reducing costs and improving efficiency in their businesses.


3 Technology

3.1 What are the main network components?
       SWIFT operates from three data centres on two continents. This setup eliminates single
       points of failure and we pair the centres to provide the other with an active backup
       facility.
       Each data centre has built-in resiliency and contingency. We dimension the centres so that
       each can manage SWIFT’s entire operations independently, if required.
       We diversify the network connections and ensure there are always at least two routes to
       carry the traffic load. There is strong emphasis on fallback connectivity for customer
       connections and alternative methods of connection to the SWIFT network are mandatory.
       A support and problem management system provides customers with a single point of
       entry through service centres in the United States, Europe and Asia Pacific on a 24x7 basis.
       More than 350 technology partner companies provide solutions that help our customers
       optimise their use of SWIFT. SWIFT runs a certification programme to guarantee
       compatibility.
       A command and control infrastructure handles incident management. Business continuity
       plans ensure risk mitigation, risk assurance, risk management and enforce systems
       recovery plans. A three-tier crisis management process ensures the handling of more
       critical situations.


3.2 How does SWIFT ensure data security?
       SWIFT is synonymous with security. Numerous features such as passwords, authentication
       of the message content and the sender, encryption, audit tracing and intrusion detection
       ensure data confidentiality and integrity. Messages leaving a customer site are encrypted
       before their transmission over SWIFT's network.
       The sender defines and controls the information in a SWIFT message. SWIFT cannot see it
       without explicit authorisation, and then only for defined reasons. In this respect, the
       SWIFT messaging service is comparable to a postal service.
       SWIFT does not archive messages long term. Messages are stored for a short period of 124
       days to assist in the resolution of possible operational claims between users. Then, the
       messages are overwritten. Users, however, generally have a legal obligation to archive the
       messages they exchange over SWIFT.




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3.3 What types of financial messaging does SWIFT provide?
       An IP-based messaging platform, called SWIFTNet, provides interactive real-time
       communication, file transfer and browsing capabilities, and gives access to the core store-
       and-forward FIN service.
           FIN: Financial institutions use FIN for individual messages, which require the highest
           levels of security and resilience. Features include validation to ensure messages
           conform to SWIFT message standards, delivery monitoring and prioritisation, message
           storage and retrieval.
           InterAct enables users to send structured financial messages and short reports. It
           supports real-time messaging, store-and-forward messaging and real-time query and
           response between two customers.
           FileAct enables users to send batches of structured financial messages and large
           reports. It is tailored for the reliable transmission of large volumes of less critical
           information.


3.4 What are business solutions?
           Our portfolio of business solutions provides tools for members to interoperate with
           their counterparties in payments, trade, treasury and securities. Our products and
           services combine applications, message standards, connectivity options and messaging
           services to meet particular business.
           SWIFT offers consulting services to share its expertise in these areas and markets.
           Review the portfolio here.


3.5 What is a SWIFT message standard?
           SWIFT message standards are the key to SWIFT’s processing efficiency. A standard is
           comparable to a template, which contains data fields the sender must complete.
           These fields are computer-readable and enable processing to be automated, resulting
           in fast, cost-effective and unambiguous communication across borders and linguistic
           barriers.
           More than 230 SWIFT standard message types support the main business
           functionalities in the payments, treasury, securities, and trade services markets. SWIFT
           standards have become the common language for financial messaging.
           SWIFT’s message standards are freely licensed to encourage broad adoption and are
           recognised by the International Organization for Standardization (ISO). SWIFT not only
           helps set standards but also implements and validates their usage.
           SWIFT works closely with international standards bodies such as FpML, FIX, XBRL and
           DTCC to encourage the adoption of its ISO standards and interoperability with theirs.




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3.6 What is a BIC (also called SWIFT code)?
       SWIFT uses the Bank Identifier Code (BIC) to identify each network user and route
       messages to their destination. Each BIC is unique to a single institution and is comparable
       to a postal or email address.

       Example: National Bank of Belgium




       The BIC is a standard of the International Organization for Standardization (ISO) and SWIFT
       is the registration authority. The BIC code is commonly called the SWIFT Code.




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4 SWIFT and the community

4.1 Why does SWIFT call itself a community?
        Over the years, SWIFT has established itself as a unifying force in international finance.
        Our cooperative structure enables our users to influence our activities for their collective
        benefit. This community of users represents a broad international base, so best practice
        from many countries shapes governance and operational procedures.
        The Board, the Executive and staff work closely with our user community through national
        member groups, user groups, working groups and SWIFT-organised business forums and
        conferences to develop policies and strategy, discuss product and service performance,
        and create or update message standards. Once a year, the SWIFT community comes
        together at Sibos.


4.2 What is Sibos?
        Sibos is an annual conference, an exhibition and a networking event organised by SWIFT
        for the global financial community. It brings together individuals, organisations and the
        financial community to meet, discuss, learn and expand business relationships and
        opportunities.
        Sibos attracts more than 7,000 participants, from established financial institutions to
        application and middleware vendors, system integrators, central clearing systems and
        consultants.
        In 2010, we will hold Sibos in Amsterdam, the Netherlands. Every year, more than 130
        financial journalists cover the event on site. Journalists can request Sibos accreditation
        here.


4.3 Corporate social responsibility
        SWIFT is a supporter of the Arts and our engagement with the One Laptop Per Child
        organisation has seen the deployment of 20,000 laptops across five countries in the
        developing world.
        From an environmental perspective, we have established a partnership with the
        International Polar Foundation with the aim of raising awareness and increasing general
        knowledge in the financial world about climate change issues. We have also committed to
        a 60 percent reduction in our carbon footprint over the coming three years.


5 Latest facts and figures
Detailed facts and figures about SWIFT, its products and services, and message traffic are available
on our web site. We update the figures monthly.




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6 Press contacts
SWIFT has press contacts around the world. Do not hesitate to contact someone near you.


Global press office at Headquarters in Belgium:
Euan Sellar, Head of Public Relations
E-mail: pressoffice@swift.com
Phone: +32 2 655 3243 or +32 2 655 3377


Regional media contacts:
We hope to serve your editorial needs better by providing the following regional contacts:
    Americas
    JoAnn Healy, Head of Public Relations Americas
    SWIFT Americas
    E-mail: joann.healy@swift.com
    Phone: +1 212 455 1802
             SWIFT’s communications agency for the Americas
             Intermarket
             Contact: Eric Hazard
             E-mail: ehazard@intermarket.com
             Phone: +1 212 888 6115

    Asia Pacific
    Beth Smits, Head of Communications Asia Pacific
    SWIFT Asia Pacific
    E-mail: beth.smits@swift.com
    Phone: +852 2107 8892
            SWIFT’s communications agency for the Asia Pacific region
            Bite Communications
            Contact: Jowie Law
            E-mail: jowie.law@upstreamasia.com
            Phone: +852 2973 0222

                Japan
                Weber Shandwick
                Contact: Masahiro Sakamoto
                msakamoto@webershandwick.com


    Europe – Middle East - Africa
    Contact: Euan Sellar, SWIFT
    E-mail: euan.sellar@swift.com or pressoffice@swift.com
    Phone: +32 2 655 3377
            Austria, Germany and Switzerland
            Charles Barker Corporate Communications
            Contact: Kornelia Spodzieja or Hans-Jürgen Schneider
            Phone: +49 69 79 40 90 46
            E-mail: Swift@charlesbarker.de


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           Belgium
           akkanto
           Contact: Diana Munro or Jo Detavernier
           Phone: +32 2 674 2250
           E-mail: swift@akkanto.com

           France
           Fleishman-Hillard
           Contact: Mathilde Bordron
           Phone: +33 1 47 42 92 76
           E-mail: mathilde.bordron@fleishmaneurope.com

           United Kingdom
           Fishburn Hedges
           Contact: Liz Larvin
           Phone: +44 (0)207 839 4321
           E-mail: swift@fishburn-hedges.co.uk




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