Shanghai toasts SWIFT win

SWIFT, a global bank standardized messaging and interface software provider, said yesterday it will set up an office in Shanghai and provide securities services for the first time in China.

The Society for Worldwide Interbank Financial Telecommunication has attracted four Chinese banks to join its standard, according to Michael Cheung, SWIFT China's head. "The biggest advantage of our service is it is secure and reliable and Chinese banks can better connect to the world's finance based on our system," Cheung told a media briefing yesterday.

SWIFT has signed four banks on the Chinese mainland, Bank of China, China Construction Bank, China Huaxia Bank and China Minsheng Banking Co.

With the SWIFT code, the domestic banks can improve efficiency on remittance and global interbank services. SWIFT, based in Brussels, is a non-profit organization providing secure and standardized services and software to more than 8,100 financial institutions, including banks, broker-dealers and investment managers.

SWIFT plans to open a new office in Pudong New Area in Shanghai by the end of this year, Cheung said.

The organization has signed agreements with the Shanghai Stock Exchange. SWIFT will provide the exchange with service and software on corporate action, such as dividend payouts, with a more efficient way based on IT technology, according to SWIFT.

Chinese banks are expected to invest 43.27 billion yuan (US$5.69 billion) on IT infrastructure in 2007 and the figure will hit 59 billion yuan in 2011, according to the Net of China Banking, an industry Website.

Each new entry will cost a bank about 25,000 euros (US$33,668) and about 10,000 euros in annual fees. The price level will be pruned if more banks join the standard, Cheung said.