BNP Paribas is swallowing its own blockchain medicine, applying the technology to the global internal treasury operations of the bank.
The French bank has been an active proponent of distributed ledger technology, running multiple pilots in areas as diverse as corporate actions, corporate payments, crowdfunding, SME post-trade operations and share registry.
Now the ALM Treasury department, which manages the bank’s internal treasury, is the latest to try out the technology in a trial deployment aimed at extending working hours up to 11 hours.
The pilot not only demonstrated treasury optimisation improvements, says the bank, but also a common view of liquidity positions across locations globally. It also allowed the bank to boost the interoperability of the legacy systems combining the private blockchain with the existing IT environment via software robots and APIs.
Emmanuelle Bury, BNP Paribas chief operating officer for ALM Treasury, says: “We launched the initiative 10 months ago with a view to address the current constraint on cash transfer capabilities limited to a range of 7 to 10 hours a day and ways to enhance operational efficiency. It was also important for us to start exploring the blockchain possibilities, in particular given the interest Central Banks grants to those technologies.”
Xavier Toudoire, BNP Paribas, head of ALM treasury IT strategy and architecture, adds that the private approach allows the development of different business and operational processes that previously were not possible due to the distribution of data or trust among the parties in the system.
For instance, as an inhouse operation, the treasurers involved were free to break the current boundaries by reading an accurate cash position of another closed treasury location, and perform operations on behalf of these locations on several currencies.
Says Toudoire: "Although it is still too early to determine how the technology will evolve and whether it is suitable for large-scale deployment, our pilot has demonstrated the clear strengths of private blockchain and its potential as one of the most effective ways to improve the existing internal processes between different businesses on an international level.”