Special Interest Session - MyStandards

SWIFT Business Forum

London 2013

Special Interest Sessions

Practical solutions for mandatory market

change and improved client servicing

Speakers

• Stew Cofer, Vice President, SWIFT Product Manager, J.P.

Morgan

• Susan Dean, Managing Director, Head of EMEA Transaction

Services, J.P. Morgan

This document contains information that is confidential and is the property of J.P. Morgan Chase & Co. It may not be copied, published, distributed or used in whole or in part for any purpose other than as expressly authorized by J.P. Morgan Chase & Co. All trademarks, trade names, and service marks appearing herein are the property of their respective owners. 3

&

MyStandards

What’s best for our clients is best for us

This presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by J.P. Morgan. It may not be

copied, published or used, in whole or in part, for any purpose other than as expressly authorized by J.P. Morgan.

The statements in this presentation are confidential and proprietary to J.P. Morgan and are not intended to be legally binding. Neither J.P. Morgan nor any of its directors, officers, employees or

agents shall incur any responsibility or liability whatsoever to the Company or any other party in respect of the contents of this presentation or any matters referred to in, or discussed as a result of,

this document. J.P. Morgan makes no representations as to the legal, regulatory, tax or accounting implications of the matters referred to in this presentation.

The products and services featured in this presentation are offered by JPMorgan Chase Bank, N.A., member FDIC, or its affiliates/subsidiaries. All services are subject to applicable laws and

regulations and service terms.

J.P. Morgan is a marketing name for the Treasury Services businesses of JPMorgan Chase Bank, N.A. and its affiliates/subsidiaries worldwide.

J.P. Morgan is licensed under U.S. Pat Nos. 5,910,988 and 6,032,137.

© 2013 JPMorgan Chase & Co. All rights reserved

About J.P. Morgan

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Our clients are at the heart of all we do

For the fourth year in a row

SWIFT for Corporates Bank of the Year

2009, 2010, 2011, 2012

“Our aim is to be the world’s most trusted and respected

financial services institution.” - Jamie Dimon, Chairman and CEO

• Fortress Balance Sheet; 11% Basel I Tier 1 common ratio • Reorganized global wholesale business around clients to better serve them: 50,000 employees serving 76,000 clients in over 100 markets.

• FI and Corporate clients using SWIFT & standards benefit from this core philosophy: from CEO to each employee, we are here to serve clients.

Why MyStandards?

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It must be easy to do business with J.P. Morgan. Specific to standards, we recognise client needs differently:

• where we are their primary bank • multi-banked clients require a standard offer from us and competitors

What does “easy” mean in a SWIFT & standards context?

• Remove the entrance barriers presented by use of standards • Accelerate the realisation of benefits (economic, efficiency) • Drive simplicity of language and transparency of key information

JPMorgan leads use of MyStandards to deliver a better client experience: - Pilot Member; 1st bank to publish usage guidelines - Driving “co-opetition” / competitor partnership for multi-banked clients - 1st bank to contribute content to MyStandards “Phase 2”: testing portal

MyStandards helps us deliver our client promise.

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Driving a better client experience

The Client Experience

How a standard works

Market Practices

JPM specifics

business

context for use

MyStandards

Today Tomorrow

•Incorporation of more market practices • More competitors upload their practices in a unified fashion: allowing customers to see applied use of any standard across all service providers • Further embedding within JPMorgan • Medium-term: allow counterparties to test against rules described in MyStandards (SWIFT Testing Portal)

Other Bank

specifics

JPMorgan use and expertise

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Corporate and Investment Bank

Transaction Services

Securities Services

Investment Bank

Introduction of MyStandards

% of SWIFT Traffic

MT3's

MT5, ISO15022

MT1,2,9, ISO20022

MT3xx

MT5xx

A tool to help: • Consume

Standards Releases Comparisons new to old/existing User Handbook

• Distribute Export (PDF, XML Schema) Client-specs All in standard format

• Engage counterparties & market Be part of change process Right stuff to the right people Real feedback from real users

MT56x

ISO15022

ISO20022

MT1xx

MT2xx

MT3xx

MT4xx

MT7xx

MT9xx

ISO20022

When we help our clients, we help ourselves

J.P. Morgan Standards Usage

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Immediate benefit: Annual Standards Releases

Standards Release Lifecycle: July Prior Year -> November current year

SWIFT

JPMorgan SR2012 SR2013

Nov 2012

SR2012

is Live

2013

Release

Live

July 2012

High-level

SR2013 info

Nov 2012:

SR2013 changes

approved

Dec 2012

SR2013 Guide &

Formatting Rules

Feb 2013

Update to SR2013

Guide & Formatting

July 2013

SR2013 User

Handbook

JPM business engagement on above activities.

SWIFT Shared Services

Proactive & Reactive engagement with tech

Help understand requirements

Compare SR2013 to SR2012

Compare 2013 to SR2012

Facilitate Network Testing

Product Management

(input to SR2013)

Business Analysis

Technology (SR2012 build & QA)

Finish Build->QA-> Live

vote/consult Write Requirements Verify req. Build Finish Build->QA-> Live

Central teams at any bank could exceed 250+ applications, interacting to help them understand releases, timelines, and their impacts.

Each application follows its own change process

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Benefits from experience

Obvious Hidden

Inventory of internal stakeholders User registration identifies those who step out and become visible to administrators, specifically for the standards they’re interested in

Budget and Resources Better visibility and insight of change and the impact on internal systems. System inventory being built and identifies standards used by each

Standardised Tool has become a self-service approach rather than relying on shared services to disseminate and share information

Single source of truth for all teams in the Bank and our clients – accessible by all anywhere, any time.

10min interaction x # of applications x app functions (BA, product) MyStandards saves us TIME =

Duplication of cost & effort

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MyStandards Rollout at JPMorgan

What’s Next:

Global Governance Team that identifies opportunities and guidance to onboard more internal teams

Leverage more technology partners to incorporate MyStandards exports (XML schema) into development

Continue engaging in market practice groups to use MyStandards in the mission of more standardisation

Rollout with SR2013 Current Use

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Challenges and opportunities

Expressing business rules/logic How many levels of detail to express? ISO Message type Geography Instrument type (US ACH) Sub-instrument type (CCD+, PPD)

MT 1xx Geography (of account or currency?) Currency Instrument type

Internal challenges: New user registration – onboarding; requires organisation-authored FAQ Administration/maintenance Identify single owner of content We need a workflow required for maintenance

We are pursuing: -Helpful conversations with SWIFT on Governance of MyStandards for large users -Bilateral conversations with peers on MyStandards – agreeing to use common practices as a model to populate usage guidelines -The next phase: helping SWIFT form a Testing Portal for content in MyStandards

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Discussion