Speaker 1: Global business news twenty four hours a day at Bloomberg
Speaker 1: dot com, the Radio, plus mobile last and on your radio.
Speaker 1: This is a Bloomberg Business Flash from Bloomberg World Headquarters.
Speaker 1: I'm Charlie Pallet to Dow. The SMP and naz DAK
Speaker 1: are all climbing. SMP five hundred index holding up the
Speaker 1: highest since July, bolstered by speculation borrowing costs will remain
Speaker 1: lower for longer amid moderate growth. The SMP five hundred
Speaker 1: index up seven points to nineteen, a gain of four
Speaker 1: tenths of one percent. Down Industrials up sixty eight points,
Speaker 1: a gain of four tenths of one percent. Nasdaq is
Speaker 1: up by three tenths of one percent. Ten your up
Speaker 1: five thirty seconds ZAL there is one point seven oh percent.
Speaker 1: Gold up sixteen eighty the ounds to twelve sixty three,
Speaker 1: a gain of one point four percent, and crude oil
Speaker 1: of eighty three cents of L fifty one nineteen right
Speaker 1: now on West Texas Intermediate that is a gain of
Speaker 1: one point seven percent. I'm Charlie Pealoton. That's a Bloomberg
Speaker 1: Business Flash. You're listening to taking STI with Kathleen Hayes
Speaker 1: and Pim Fox on Bloomberg Radio Technology. It is one
Speaker 1: of the most powerful forces transforming the financial services industry
Speaker 1: and a big topic of discussion here at Pershing's Insight
Speaker 1: sixteen conference at the HIGHERT Regency in Orlando, I had
Speaker 1: the pleasure today of moderating a panel called Invested in Innovation,
Speaker 1: and one of those panelists is here with me and
Speaker 1: Pim Now Swish Kamara, Senior executive vice president as he's
Speaker 1: chief information officer at b n Y Melon Swirsh, Welcome,
Speaker 1: what's great to have you on the show. I just
Speaker 1: want to start by having you tell our listeners a
Speaker 1: bit about your background, because it's so interesting. You left India,
Speaker 1: you come to New York, you staructing your master's in
Speaker 1: computer science, you start your own company, and then you
Speaker 1: go to work for Pershing, which was then part of
Speaker 1: the old d l J. Tell us about about that
Speaker 1: experience and what you how you became a pioneer of
Speaker 1: online brokerage here in the US. Well, you know, we
Speaker 1: started off as a consultant at the Persian and the Prodigy,
Speaker 1: which was an online network by Sears and IBM. They
Speaker 1: were just starting out and before the Internet, before that,
Speaker 1: long before they Internet, so that was um. So they
Speaker 1: were looking for a partner to offer brokerage services, and
Speaker 1: you know, Persian became the participant and I was happy
Speaker 1: to be there at the beginning of an online brokerage journey.
Speaker 1: So from there, you know, we went and offered a
Speaker 1: similar services on American Online around ninety four, and when
Speaker 1: the Internet became popular around ninety six, you know, we
Speaker 1: offered d l J Direct, which is our online brokerage
Speaker 1: on the Internet. Then you know, we went and did
Speaker 1: the same in Tokyo, London and Hong Kong. You make
Speaker 1: it sounds so simple, but not everybody was doing it
Speaker 1: back then. Yeah. Well, actually, by the time you know,
Speaker 1: we offered on the internet, you know, we had close
Speaker 1: to eight years of experience. So Russian, Why don't you
Speaker 1: can comment on the desire on the part of let's
Speaker 1: say more than two thousand investment professionals that are here
Speaker 1: attending inside. What did they want? What should have registered
Speaker 1: the destment advisor? What do they need from technology today? Yeah?
Speaker 1: I think that the question is what do their clients
Speaker 1: need that the advisors need to you know offer, you know,
Speaker 1: to me, the client expectations have dramatically changed. You know,
Speaker 1: most people have today technology at home that's a lot
Speaker 1: more efficient than most people have at work. So this
Speaker 1: notion of you know, people being able to get what
Speaker 1: they need when they needed something by twenty four uh
Speaker 1: and and to have something that seems smart and that's
Speaker 1: able to learn learn about client's needs is you know
Speaker 1: what the clients want? So far as successful financial advisors,
Speaker 1: they need to figure out how to offer that kind
Speaker 1: of service, leveraging technology so they can scale and they
Speaker 1: can do it selling twenty four in any device. What
Speaker 1: does that mean leveraging technology, scaling it in real terms?
Speaker 1: Give us an example of what how someone then can
Speaker 1: take the step up? What would they be doing with it? Yeah,
Speaker 1: so you know, historically, you know, an advisor may be
Speaker 1: available you know, Monday through Friday nine f five and
Speaker 1: if a client needs a conversation, they would make a
Speaker 1: trip and get the information they need. Um. You know
Speaker 1: today people clients would probably want that in their smartphone
Speaker 1: or you know from home. Sell by twenty four. So
Speaker 1: the ability to access information when they need to, the
Speaker 1: ability to communicate, I think it is becoming an important aspect.
Speaker 1: Is there any negative to that increased volatility? Is there
Speaker 1: any need really to be so short term oriented. If
Speaker 1: you are a retail investor, why use this technology If
Speaker 1: everyone says have a diversified portfolio, what I looked to
Speaker 1: the long term? Yeah, I think it's more about convenience
Speaker 1: rather than being able to do when you have the time,
Speaker 1: rather than being able to trade sound by twenty four.
Speaker 1: You know, for the most part, people looking for advice
Speaker 1: if they are busy professionals, you know, doing it Monday
Speaker 1: through Friday, and I'd be the most effective way, you know,
Speaker 1: so they would like to do it when they have
Speaker 1: the time on the weekend, and so so be and
Speaker 1: my melon pushing um Silicon Valley innovation centers where it
Speaker 1: just seems to me that it's it's tough because, uh,
Speaker 1: pushing ahead developing a technology great, But you've got a
Speaker 1: lot of little fin techs. They've got all kinds of people,
Speaker 1: you know, pushing and hoping they can disrupt you, right,
Speaker 1: And it's great to be the disruptor, but it's not
Speaker 1: so great to be disrupt dead. Um. It's an interesting point.
Speaker 1: You know, as a large financial institution, we have lots
Speaker 1: of capital, you know, we have great financial strength, We
Speaker 1: have clients, we have phenomenal amount of data about what
Speaker 1: the clients do, all the things of fintech would love
Speaker 1: to have UM and the thing that FinTechs have is
Speaker 1: their passion and and their willingness to try different things
Speaker 1: UM and to be able to leverage open source software
Speaker 1: or cloud computing. So our opportunity is to really figure
Speaker 1: out not to treat them like as someone who's trying
Speaker 1: to compete with us, but more to figure out how
Speaker 1: to take the best practices of fintech as well as
Speaker 1: to potentially leverage them so that our clients can get
Speaker 1: the benefit of both. How does financial technology and fintech
Speaker 1: benefit the smaller asset manager? Well, I think that what
Speaker 1: you're going to see. You know, historically, you know, people
Speaker 1: had this cineo monolithic applications, and you know we're a
Speaker 1: very long UH sales cycle and and and the cost
Speaker 1: of making a choice used to be you know, really high.
Speaker 1: You and now with a lot of small in a
Speaker 1: small fin techs and the next and platform that we have,
Speaker 1: people will be able to pick and choose on a
Speaker 1: variable cause basis UH dramatically reducing the time it takes
Speaker 1: to get something done as well as to avoid any
Speaker 1: major mistakes, So you're going to see more and more
Speaker 1: people being able to try different things a lot quicker
Speaker 1: than in the past. What about the threat that all
Speaker 1: this technology poses to your customers? Here the the advisors,
Speaker 1: uh robo advisors, algorithms, artificial intelligence. At some point of
Speaker 1: it to say, who needs a human being? I could
Speaker 1: just plug all my data. Maybe you guys would even say, fine,
Speaker 1: we'll just plug all information in. We'll spit it out
Speaker 1: to you and you know, forget all these advisors running around.
Speaker 1: So you know, it's interesting you say that because I
Speaker 1: used to think like that, that's a upcoming online brokerage.
Speaker 1: I you know, always thought that tchnologies to answer to
Speaker 1: every problem. Uh now with all the experience and maybe
Speaker 1: a little more money to protect them in the past,
Speaker 1: I would rather talk to a human being because you know,
Speaker 1: at the end of the day, there is a lot
Speaker 1: more to financial advice, you know, than as an allocation
Speaker 1: in using the technology. Tell us about the cost? How
Speaker 1: has that changed? While clearly the cost of transacting for
Speaker 1: the industry has come down, and you know you're going
Speaker 1: to see more and more of that even with the
Speaker 1: likes of blockchain and distribute a ledger so I think
Speaker 1: there's going to be an opportunity for the industry to
Speaker 1: remove the friction you know that takes place between transactions
Speaker 1: between different participants. Um. So certainly I think it will
Speaker 1: be better for the clients. So the cost of doing
Speaker 1: business should keep going down. What is the friction for
Speaker 1: those of us who do not work at a large
Speaker 1: financial institution in these transactions? And how will the blockchain
Speaker 1: which is what the pitcoins based on, or we know
Speaker 1: we're not talking about pitcos, we're talking about code, a
Speaker 1: new kind of code. Why is this such a revolutionary thing,
Speaker 1: this new this new blockchain. Yeah, you know, when you
Speaker 1: have a large number of participants trying to get something done,
Speaker 1: usually you had lots of intermediaries, lots of reconciliation, and
Speaker 1: you know the end result was things to time to
Speaker 1: get something done. And obviously, yeah, our cross board of
Speaker 1: payments are trade, finance, you know, any number of things
Speaker 1: that we do today. Um, and it's mostly because of that.
Speaker 1: You know, things cost money and there are lots of exceptions. Uh,
Speaker 1: you know, the expectations is a technology like a blockchain
Speaker 1: and a distributed ledger or dramatically reduced the disagreement that
Speaker 1: people may have because everyone is looking at the same thing,
Speaker 1: for example, a corporate action. And I imagine if you
Speaker 1: were to have a distribute a ledger of all the
Speaker 1: securities and the corporate actions in one place and everyone
Speaker 1: looked at it, it will cost us a lot less,
Speaker 1: you know, to process, and you can do the same
Speaker 1: in with the K Y c R A m L.
Speaker 1: What kinds of workers, what kinds of skills are you
Speaker 1: looking for specifically to join Pershing? Yeah, I you know,
Speaker 1: it's a it's a great question. Uh that technology is
Speaker 1: changing fast, our client needs are changing enough fast. Um,
Speaker 1: so clearly we're looking for you know, what we call
Speaker 1: full stack engineers, people who can do the user experience
Speaker 1: as well as the back end as well as you know,
Speaker 1: they need to be more sensitive to what's out there
Speaker 1: in the marketplace, have a good understanding of what the
Speaker 1: clients are expecting. So you know, you're kind of looking
Speaker 1: at not just a pure technologist anymore. You're also looking
Speaker 1: for people with some understanding of the clients and the products.
Speaker 1: Thank you very much for joining us, and thank you
Speaker 1: for having us here. Suresh Kumar is a senior executive
Speaker 1: vice president and the chief Information Officer for b n
Speaker 1: Y Melant. We are broadcasting live from Pershing's Inside Conference
Speaker 1: at the Higher Regency Orlando, and this marks eighteen years
Speaker 1: of insight, eighteen years committed to the success of advisors,
Speaker 1: and we have over two thousand financial professionals from all
Speaker 1: over the globe attendant. If you're listening to the Bloomberg
Speaker 1: Radio