Interview: Wissam Khoury, Finastra – Embracing the future of open treasury and capital markets solutions

A version of this article was published in the Global Banking & Finance Review.

Wissam, can you tell us about Finastra’s vision for open treasury and capital markets?

We want to build treasury and capital markets solutions that drive efficiency, growth and sustainability for our customers. Finastra’s journey began with a vision of an open financial landscape, and today, we’re making that vision a reality by supporting some of the world’s largest banks. We want to unlock financial innovation in treasury and capital markets by automating trading workflows, to reduce risk, maximize operational efficiency and help support compliance. Finastra’s real-time technologies give banks the tools to reduce costs and scale up services, while innovating alongside a broad and diverse global network of partners.

Sustainability is a clear focus for open treasury, can you elaborate?

Supporting investment managers in their societal and sustainable investments is a key focus for us. To achieve this, organizations should look for investment management platforms that aid investment managers to oversee a wide range of asset classes and investment types, including strategies with societal and sustainable goals. They need tools that enable them to interrogate the full investment lifecycle including sophisticated analytics and pre-trade decision-making. Equipped with the right technology, users can make informed decisions that drive positive social and environmental outcomes, for example those focused on impact investing and specific ESG factors.

Financial institutions often face challenges in impact investing due to inadequate analytical capabilities, complex regulatory compliance, operational integration difficulties, and scalability issues. Organizations can address these challenges by tapping into enhanced analytics for better decision-making and streamlining compliance with evolving regulations. Seamless integration with existing systems through open APIs, and scalable platforms that support growth and adaptability are crucial in impact investing.

How do you ensure capital markets solutions remain open and accessible?

Robust capital markets platforms that are open by design and stand as the trusted backbone for investment banks are essential. Open platforms help accelerate trade validations, improve portfolio management, and drive efficiency through real-time pricing and compliance management. Finastra’s comprehensive front-to-back solutions support debt raising and risk management for development banks to help foster societal change. Our platform is designed to cater to the needs of investment banks and corporate organizations in managing portfolios and trading activities, particularly for listed, cleared, OTC derivatives and structured products.

Capital markets face several challenges, including slow trade validations, intricate risk management for development banks, the need to adapt to new technologies, the complexity of managing diverse portfolios, and the demands of supporting a wide range of financial products. These challenges can be tackled by using agile platforms that speed up trade validations and robust risk management solutions tailored for development banks. Additionally, open architecture facilitates seamless integration and fosters innovation, while real-time tools and specialized solutions enhance portfolio management efficiency and the effective management of a broad array of financial products.

What about the optimization of trading for banks’ treasury operations, can you tell us about that? 

Optimizing and integrating banks’ treasury trading operations with market services is essential for building a stable and collaborative financial ecosystem that can rapidly respond to changing regulations and foster growth across global and local markets. Open solutions play a pivotal role in this process by enabling seamless integration with external applications, allowing banks to quickly adapt to market changes, such as the rise of ESG products.

Organizations need solutions that optimize trading of high-quality liquid assets and deliver cost-effective treasury operations from front to back. Open solutions not only addresses these challenges but also enhance collaboration across the financial ecosystem. By providing advanced systems for secure data processing and analysis, we enable banks to harness the full potential of their data for better decision-making. Additionally, our platforms combat bias through analytics, training, and automated decision-making tools, while ensuring compliance with evolving regulations.

Finally, what are the benefits of using a SaaS solution to monitor risk and Asset Liability Management (ALM) policies?

Smaller banks have historically struggled to access the same sophisticated risk management tools as larger institutions, but SaaS-based solutions are changing the game – enabling them to compete on a more level playing field. The availability of asset liability management functionality via the cloud, gives smaller banks the ability to better manage banking book risk and ensure compliance with IRRBB principles and ALM policies. This enriches diversity and competition across the financial ecosystem.

Particularly valuable for banks focused on retail activities, financial institutions can now access reliable ALM solutions to enhance balance sheet analysis and reporting, providing clear visibility into exposure risks and effective hedging strategies, which helps build confidence among regulators and shareholders. By preventing insolvencies in volatile market conditions, it supports the stability of local financial ecosystems and contributes to broader societal wellbeing. Additionally, having an open API framework reflects the open finance philosophy, enabling seamless integration with the wider financial ecosystem.

Recognizing the challenges of analyzing historical performance and real-time liquidity, market forecasting, regulatory compliance, and risk, these challenges can be addressed by leveraging AI and machine learning to uncover these insights. Furthermore, ALM solutions can streamline regulatory compliance and enhance risk management through clear visibility into exposure risks and effective hedging strategies, bolstering the stability and resilience of financial institutions.

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