A post relating to this item from Finextra:
04 May 2012 | 8235 views | 1
The Financial Stability Board has abandoned plans for a global registration authority for Legal Entity Identifiers in favour of a federated network, dealing a hammer blow to the ambitions of interbank...
The news that SWIFT is not going to be the registration authority for LEIs is ultimately a good thing for SWIFT. As the finance industry changes and new technologies emerge, it’s inevitable that SWIFT will also change. It has been changing over recent years,
becoming far more commercially aware and has moved into creation and development. Sometimes this is to offer modern technologies and other times, reflects the position SWIFT holds in assisting the market, to introduce business processing changes. All this
I see as positive changes for SWIFT and more importantly the market users and their customers.
It is obvious that today the global markets are in a period of evolution. However, the speed of change may look to some like revolution when compared to the rather stagnant decades, where the concentration on message structures slowed to almost a standstill
and where the relevance of technology and messaging in particular did not meet the finance industry needs.
The new SWIFT which is emerging appears to be more vibrant and far more creative in meeting the requirements of not just its users, but for the establishment of a much better global market place for settling transactions.
LEIs will be rolled out faster across global markets and products as a result of the decision to have federal ownership of the new identifying standard. However, this still brings in to question ownership and governance of the LEI.
There is no point ending up with bespoke identifying standards that although consolidated from today, would still limit the benefit that would accrue from a single identifier.
It’s always been my view that ownership should be by standard licence, governed by a federal board of issuers of LEIs and SWIFT should certainly be on the board. So I believe the decision to go federated, it is the right thing today and will herald a new
age for financial market operations and processing.