Tamara Dardanoglu - 28.06.2022
On 9th of July 2022, our MACD Conference took place again in Zurich. More than 80 participants from over 30 financial institutions met for a personal exchange and gained interesting insights into current topics and developments in the world of finance.
Moderated by George Macdonald (CEO at MACD) Fabian Bannwart (Delivery Lead at Schroders), Matthias Ritz (Deputy General Manager at Allfunds Bank AG) and Michael Lüthi (Head Sales & Relationship Management, Switzerland, at SIX SIS AG) discussed the opportunities and challenges of digitalisation in the fund markets.
The panelists talked about two basic approaches: On the one hand, SIX SIS and Allfunds, which act as central counterparties for banks and automate the order placement and custody of funds. As service providers, they thus unify the interface between the banks and the market side. SIX SIS´ operating model is based on the connection to other providers and custodians. The direct connection via SIX SIS to the transfer agents is in turn ensured by the providers. On the other hand, Schroders pursues the approach of handling the communication with transfer agents directly and thus having full control. For Schroders as a large asset manager with large order volumes, this approach is advantageous.
Marcel Koller (Chief Economist at Aargauische Kantonalbank, or AKB for short) spoke about current developments in inflation, real estate prices and interest rates, as well as the stock market. With the currently very high inflation rates (for example 8% in the Eurozone), AKB expects a slight decline from Q3 2022 onwards. However, this is conditional on central banks raising interest rates, which AKB also assumes.
Real estate prices in Switzerland continue to rise significantly, but there has been a change in the last two years with regard to real estate locations, so that infrastructurally weaker areas are now also in demand. This is directly related to the pandemic, as many employers continue to offer work-from-home options, eliminating long commutes to work - making real estate location infrastructure no longer a deciding factor for many.
The mood on the stock market, shaped by current events, remains tense, he said. A correction is currently underway. Uncertainty is high. Nevertheless, AKB does not expect a crash of the stock market, Marcel Koller said, but rather a volatile sideways movement at the current lower levels in the course of the year.
In his presentation, George Macdonald gave a review of the history of trading and the development of MACD. Since the first joint stock company was founded in Amsterdam in 1602, trading has undergone fundamental and lasting changes: From ring trading, where stockbrokers and market traders trade securities on the spot by shouting, to the digitalisation of trading today. Trading on the computer is faster and can be done from any location, but it has also become much more complex. Nevertheless, the core process has remained the same and trading remains trading. Buyers and sellers must be able to communicate efficiently with each other. Through years of experience, MACD has become a professional in digital trading, no matter what asset class is involved.
Since the last conference three years ago, MACD was able to successfully implement several projects. New partnerships have been established and new brokers have been connected, for example SIX Global Fund Services, Allfunds and the Berner Kantonalbank, but also the InCore Bank AG for trading cryptocurrencies. Quite recently, exchange-traded derivatives (ETDs) are now also part of MACD's broker network, so that non-members can also trade them via MACD. Likewise, Vontobel deritrade as well as deriBX of BX Swiss have been connected and a project in Foreign Exchange (FX) has been implemented with Dreyfus Söhne & Cie AG, Banquiers to returning the trades back into the core banking systems. Furthermore, MACD now also offers the connection of EVVs. The first customer was Zuger Kantonalbank, and others are currently being connected.
As George Macdonald further explained, there are many more tasks and opportunities in the digitalisation process of trading and MACD is ready to continue to accompany all customers on this path. The motto is still: Challenge us! We are looking forward to new exciting projects and are always available for requests, ideas and suggestions from our customers.
Many thanks to the panelists and speakers for the interesting presentations as well as to our customers and partners for the numerous, interesting conversations during the networking break and at the Apéro Riche afterwards. Many thanks also for the positive feedback on the conference, which we have already received from the participants.
We are already looking forward to the next time!