A complex and rapidly changing financial marketplace has created new challenges that financial executives must manage in order to grow their business, according to Mike Bodson, President and CEO of The Depository Trust & Clearing Corporation (DTCC), who outlined 5 key imperatives during his feature presentation at SIFMA’s 41st Operations Conference & Exhibition in Boca Raton, Fla.
Bodson was joined at the Conference by several DTCC executives who participated in key sessions focusing on important trends shaping the current global market environment. The Conference provides a venue for distinguished speakers, industry experts, regulators and senior operations professionals to examine the most pressing issues impacting the financial industry.
“The SIFMA Conference is an excellent venue for industry experts, regulators and senior operations professionals to share ideas, collaborate, build professional networks and forge consensus on important topics facing firms,” Bodson said.
During his remarks, entitled “Sleepless Nights: 5 Business Imperatives That Should Keep You Up At Night,” Bodson stressed that executives must have a firm grasp of the issues facing the industry today while keeping an eye on emerging topics that could impact long-term growth and new business opportunities.
The 5 business imperatives identified by Bodson included:
- Evolving the Operating Model
- Understanding the Power and Limitations of Big Data
- Understanding Cyber Threats & Organizational Vulnerabilities
- Engaging with Regulatory & Legislative Leaders
- Rebuilding Public Trust in Financial Markets and Institutions
The benefits of collaboration were a key theme throughout Bodson’s presentation. As an example, Bodson explained there is great opportunity for significant cost savings by targeting the roughly $100 billion that is spent annually on post-trade processing worldwide. Bodson said that the industry needs to evolve the operating model by mutualizing certain redundant and duplicative processes that do not provide firms with a competitive advantage or differentiate them from other institutions. He offered the Global Middle Office utility and Margin Transit as two initiatives being developed in collaboration with other infrastructure organizations that have generated strong industry support because they will help mitigate risk, optimize financial and human capital and deliver real cost savings.
Calling cyber security the one issue that “has the ability to cause both insomnia and paranoia in me,” Bodson cited the launch of the National Institute of Standards and Technology (NIST) Cybersecurity Framework – an event Bodson attended at the White House – as a new paradigm for collaboration between the public and private sectors to combat cyber crimes.
He alluded to lessons learned from the recent Heartbleed Bug that affected nearly two-thirds of the Internet. Bodson explained that a mere six lines of poorly constructed code had a systemic impact on the world and affected roughly two-thirds of the Internet.
“The Heartbleed Bug revealed that a firm’s cyber ecosystem is only as secure as the weakest link among those who you allow to connect to your network or whose software/hardware you use,” he said.
Building Client Value & Trust
Bodson concluded his remarks with insight into how addressing these imperatives will help increase client trust and value.
“Your ability to successfully manage these issues is critical to building a stronger organization, which will allow you to better serve your clients,” he said. “Whether it’s evolving the operating model, or combatting cyber terrorism, or proactively engaging with policymakers, the industry needs to address each of these challenges head-on because doing so will greatly strengthen your ability to add client value and build client trust.”
Bodson was joined by several DTDCC executives who participated as moderators and panelists on breakout sessions. DTCC executives included:
- Mike Bodson, President and CEO
- Mark Clancy, Managing Director & Chief Information Security Officer
- Marisol Collazo, U.S. CEO, Data Repository
- Impact of Regulatory Reform on Derivatives, Panelist
- EMIR Reporting, Panelist
- Tim Cuddihy, Managing Director, Risk Management
- Funds, Liquidity Management and Market Utilities, Panelist
- Susan Desantis, Managing Director, Deputy Chief Compliance Officer
- Micro Cap Stocks, Panelist
- Mark Jennis, Managing Director, Strategic Initiatives
- Trends, Risks and Innovations in Collateral Management, Panelist
- Bill Kapogiannis, Vice President, Equity Clearing
- NSCC Equity Clearing Update, Panelist
- David Kirby, Director of Relationship Management, Omgeo
- Full Picture: Buy Side, Sell Side and Service Providers at Asset Management Operations, Panelist
- Kevin Lewis, Vice President, Head of FICC
- FICC Clearing Update, Panelist
- Murray Pozmanter, Managing Director and General Manager, Clearing Agency Services
- Shortened Settlement Cycle, Panelist
- FICC Clearing Update breakout, Moderator
- Tom Sakaris, Managing Director, Equities Clearance
- NSCC Equity Clearing Update, Moderator
- Matt Stauffer, Managing Director, Strategy/Business Development
- Creating Industry Efficiencies, Panelist
- Dan Thieke, Managing Director and General Manager, Settlement & Asset Services
- Breakout on Corporate Actions, Panelist