Rob Barrow appointed Chairman of Strate

Rob Barrow, a current board member of Strate, has been appointed the chairman of the company’s Board, effective 4 November 2016.

 

Monica Singer, Strate’s CEO, welcomes the appointment of Barrow. “Rob has a wealth of expertise and knowledge spanning more than two decades in the capital markets and he has served rob-barrowon Strate’s board as a director for a number of years. I look forward to working with him in his new role as our chairman.” Barrow’s work history includes being the Executive and Deputy Executive Officer at the Financial Services Board, where he was responsible for the regulation and supervision of the South African non-banking financial services industries. Prior to this role, he was the Director of Surveillance at the JSE.

 

Barrow succeeds Bobby Johnston.

 

Singer says, “I am truly grateful for the role Bobby has played, not only as Strate’s chairman for the past five years, but also since Strate’s inception. He played a key role in lobbying the market to move to electronic settlement in the early days of Strate. He has been my mentor for the past two decades and his knowledge has been a great asset to this company. Going forward, I am pleased to have his continued involvement as a consultant to Strate.”

 

While Johnston was appointed chairman in 2011, he was closely involved in Strate when it was a project in 1996. He became a non-executive director of Strate when the company was formed in 1998.

 

Strate’s current Board comprises 14 directors, and 2 alternate directors, who are as follows:

 
Directors

Mr Robert Barrow (Chairman)

Ms Monica Singer (CEO, Executive Director)

Ms Ashnee Maharaj (CFO, Executive Director)

Ms Alicia Greenwood

Mr Chris Edwards

Ms Daisy Naidoo

Mr Keith Getz

Mr Leon Campher

 

 

 Ms Marilyn Ramplin

Mr Murray Stocks

Ms Nicky Newton-King

Mr Nigel Payne

Mr Raymond Ndlovu

Mr Russell Loubser

 

Alternate Directors

Mr Charl Bruyns

Mr Ryan Proudfoot

 

 

 

Trusted to be an Independent Provider of Custody and Settlement Services

Strate’s success lies in its independence and good corporate governance. It has continued to be a trusted and independent party in the market, which is evident by Strate offering CSD services to new stock exchanges.

 

At the beginning of September 2016, the Financial Services Board notified the market that it had granted ZARX and 4 Africa Exchange (4AX) exchange licences, with conditions. Strate has been appointed the Central Securities Depository for both exchanges and will continue to explore further opportunities with other bourses.

 

Strate looks forward to working with its current and new clients in the years ahead.

 

 

Strate from the Ground

For the past 18 years Strate, South Africa’s Central Securities Depository, has focused on settling securities transactions across South Africa’s financial markets. Today, the organisation is placing a core focus on financial literacy through its consumer education initiative, Strate from the Ground.

 

Dr Merrill Van Der Walt, with community members following the December Harvest

According to Dr Merrill van der Walt, Data Scientist at Strate, one of the key elements for Strate from the Ground is to educate communities on the basics of banking and financial matters (a knowledge area that is seriously lacking in marginalised areas), as well as meeting nutritional needs in a disadvantaged community that is food insecure. “The lack of food security is a huge problem for South Africans in rural areas and those of lower socio-economic standing.”

 

According to a report issued by Statistics South Africa on poverty trends in the country, poor households spend approximately a third (33%) of their income on food. Total food expenditure for poor households is given at R8 485 per annum or R707 per month. It is important to understand that this figure is the proportion that households are able to spend on food. Given current food prices, it is clear that this amount is not enough to secure a sufficient and nutritious variety of food.

 

“Adding to this harsh backdrop is the bleak reality of constantly rising food and fuel prices, high-energy tariffs and increasing interest rates. These conditions have placed severe pressure on ordinary South Africans who are already struggling to meet their basic household needs”, says Dr van der Walt. With projects such as these, people will be more empowered and educated to make better decisions in accessing basic needs as well as handling their finances.

 

“At Strate, we embrace innovation and change. The term ‘innovation’ is difficult to define, and although most models centre on technology driven innovation and competitive focus, there is a social dimension to innovation and the role of social interaction,” says Dr van der Walt. “Social innovations are new strategies, concepts, ideas and organisations that meet the social needs of different elements which can be from working conditions and education to community development and health.”

 

Strate has partnered with several organisations that will make it possible to provide nutritious and organic produce to approximately 50 labourers on a monthly basis while equipping farmers and schools in the area with the practical guidance on finance and banking.

 

Some pictures of the produce following the December Harvest:

 

 

 

Winners of the Finance and Investment Management Olympiad Announced

The Finance and Investment Management Olympiad (FIMO) is an initiative of the Finance and Investment Management Department at the University of Johannesburg (UJ), focused on Grade 10, 11 and 12 learners in high schools across all nine provinces. Earlier today, a group of prestigious individuals were awarded as winners of the second annual FIMO.

 

This initiative, which was formed in partnership with Strate (Pty) Ltd, places emphasis on learners to unleash their potential in a dynamic field within the financial services industry. “Individuals who take part in the FIMO have a specific interest in the finance discipline and the Olympiad gives them the exposure to key financial concepts that will enable them to pursue a future in the financial markets,” says Monica Singer, Strate’s CEO.  “It starts with the basic steps of debunking financial terminology and important concepts and further provides the necessary knowledge of the industry as a whole. Strate enjoys partnering on initiatives such as this, which create awareness of the financial markets at grass-root level. We are proud to be part of this initiative and the lives of the learners as they start their journey within the industry.”

 

This FIMO also provides more insight into the finance and investment industry and offers essential prizes to further allow the learners to further their studies in their respective field within the industry.

 

The final round of the Olympiad was written on 2 August 2016. The 2016 FIMO winners were:

 

Public Schools Private Schools
Grade 12 Grade 12
1st Place – M Banda, Wendywood 1st Place – J Hart, Redhill High
2nd Place – P Manyathela, Capricorn High 2nd Place – R Trusler, Redhill High
Grade 11 Grade 11
1st Place – P Visage, Huguenot High 1st Place – M Francis, Hatfield Christian School
2nd Place – L Mncube, Ladymsith High 2nd Place – N Sithole, UJ Metropolitan High
Grade 10 Grade 10
P Ramotala, Thomas Mofolo B Simelane, Horizon International High

 

The topic areas that form part of the FIMO include:

  • Economics
  • Financial Literacy: Saving and borrowing
  • Financial Markets and Instruments
  • Financial Math
    • Interest Rates
    • Risk and Return
  • Time value of money
  • Financial Statements
  • Financial System

 

“Encouraging finance and investment skills within students makes them empowered to contribute and increase the growth of the South African economy”, adds Singer. “Strate would like to congratulate all the winners and participants of the FIMO 2016 and wish you all the best of luck for the year ahead.”

 

 

Here are some pictures of the FIMO Awards ceremony:

 

Strate e-Tutor awarded the Gold Standard Award for Innovation

Earlier this year, Strate was given the opportunity to apply for an international award for innovation through a UK publication called the FSR (Financial Services Research).

 

This publication is a very well read and respected publication internationally, particularly in the financial markets.

 

The appetite for product and service innovation is vital to the development of the financial services industry, and winning this award would illustrate our commitment to delivering creative new solutions that help clients.

 

Strate entered its online training application, e-Tutor, to be considered for this award. FSR acknowledged it will be recognising excellence in product and service innovation by awarding a Gold Standard to a limited number of selected organisations that have made an outstanding contribution in this area.

 

After various interviews and rounds of evaluations undertaken by a panel of international industry experts, Strate was awarded the Gold Standard Award for Innovation for the tool.

 

This award gives Strate great exposure and world recognition for innovation and unmeasurable credibility for the app.

 

Click https://www.training.strate.co.za/ to launch the App.

Strate Processed Largest Corporate Action in its History

 

 

Strate successfully processed the electronic entries which enabled the conclusion of the acquisition of SABMiller by Belgian-Brazillian group, Anheuser-Busch InBev; the largest corporate action in its 18-year history. Shareholders received in excess of R116-billion in cash entitlements, executed through the South African Reserve Bank.

 

“Since the Competition Commission’s approval of the merger a few short months ago, we have been in consultation with both the listed entities’ legal teams, corporate advisors, and transfer secretaries to offer our guidance on how to best manage the process,” says Strate CEO, Monica Singer. “I am incredibly proud of my team and our partners for their dedication and hard work – this merger represents the largest, and probably one of the most historic equity corporate actions that we have ever executed.”

 

In order to successfully process the deal, and to operate within Belgian law, AB InBev was dissolved to create Newbelco, a Belgian incorporated company formed for the purpose of the transaction. This surviving entity, Newbelco, acquired all of the SABMiller shares. Newbelco will be the holding company for the combined group, and is also listed on the Johannesburg Stock Exchange. AB InBev announced that the combined group will retain the name “Anheuser-Busch InBev SA/NV”.

 

The R1.5 trillion merger between AB InBev and SABMiller has created the world’s biggest brewer.

 

Strate Africa Blockchain Summit

On 13 October, Strate held its Africa Blockchain Summit in Johannesburg to educate the market about Blockchain and Distributed Ledger Technology. The event was a great success, attended by over 200 delegates. Below are some pictures from the Summit.

 

Ten blockchain experts, including four international speakers, presented at the event. The following presentations have been made available:

Blockchain 101 + Public vs Private Blockchains – Lorien Gamaroff, CEO Bankymoon

Exploring the Interledger Protocol – Adrian Hope-Bailie, Web Standards Officer, Ripple

The Blockchain landscape within the EU and practical use cases – Dennis de Vries, Lead of KPMG, Digital Ledger Services Netherlands, KPMG

Blockchain KYC and Perfecting Identity Validation – Llew Claasen, Executive Director, Civic / Bitcoin Foundation

 

Some pictures from the event:

After Brexit, will a BRICS-it multilateral financial system be next?

Geneva – There is no doubt that the Central Securities Depositories community has evolved through the various partnerships that have been forged over the decades. While countries are leaving regional unions, such as Brexit, CSDs belonging to the BRICS nations continue to come together in the spirit of collaborating for the greater benefit of the financial markets.

 

Speaking at a panel discussion at the Sibos event in Geneva in September 2016, the CEO of South African CSD Strate, Monica Singer, explains that as a BRICS member, South Africa, continues to seek collaborative and knowledge-sharing opportunities with other countries to introduce innovation and ultimately profile these markets as an investment destination.

 

“There are strong networks and relationships among CSDs across BRICS, as well as internationally. They share information with one another to further develop their markets and proactively implement solutions to become more resilient, and at the same time, to keep up with the exponential rate of technological change. CSDs across the world share a greater vision of how systemic risk can spread, and when they work together in harmony, they achieve risk mitigation,” she says, adding that “CSDs as financial market infrastructures best serve their clients and the financial markets when they collaborate.”

 

According to Singer, CSDs are expected to keep up with the pace, be innovative and embrace new technologies – all while remaining resilient and focusing on their core services. “CSDs have been known to be resilient through crises, so they cannot lose sight of their core services and current client needs. They must continue to maintain a central role to provide exchange of value settlement systems, operational efficiency and transparency for the safe functioning and long-term viability of the markets. On the other hand, CSDs also need to assist their clients and the market to introduce new disruptive technologies and keep at the forefront of international best practices and trends.”

 

Distributed ledger technology (DLT), as an example of disruptive technology, has emerged as a relatively new and rapidly-growing innovative technology, and is set to revolutionise the financial markets and fundamentally create a paradigm shift. With a large number of Fintechs investing in blockchain and DLT, Singer believes that CSDs too have a role to play within this ecosystem to add value to their clients in the financial markets. “There is the potential for financial markets to create a distributed ledger that settles securities transactions, so financial market infrastructures need to embrace the technology and identify opportunities that will add value to their stakeholders.”

 

Shortly after her panel discussion, Strate and the National Settlement Depository (NSD) , which is a Russian CSD, announced that they have signed a Letter of Intent to forge a partnership to develop solutions that utilise DLT, with the first use case focused on proxy voting. This stands testament to the collaboration that has already begun among BRICS nations to introduce new concepts and solutions to a multilateral financial system.

 

“At the end of the day, it’s about the investor and the needs of the financial markets. In the face of innovation, cyber security threats, greater regulatory requirements, and protecting investors, CSDs need to come together with a common purpose to make a difference, by helping their clients keep up with the pace, future-proof the risks and provide value-adding services. Collaboration is crucial to the future stability and sustainability of the financial market.”

Strate to launch new brand and logos

Strate, will be launching its new brand and accompanying logos tomorrow, reflecting the evolution of the company and its new strategy.

A little over a month ago, we announced that Strate was embarking on a new journey, creating two divisions within the company, CSD Operations and Fractal Solutions. The changes in the company’s structure are needed to support a new strategy that embraces disruptive technologies and continuous evolution of Strate’s core business.

The new energy within the business required a fitting personality that captured the essence of pioneering technological innovation and evolving its core business, which resulted in a rejuvenation of the brand and a move away from the purple colours that Strate has worn for almost two decades.

Strate CEO, Monica Singer, says, “It has always been my intent to make a difference in South Africa, providing innovative solutions that truly bring benefits to the players in the financial markets. Strate has always sought technology that can make a difference, which is why the tagline of ‘Always Discovering’ couldn’t be more fitting.”

According to Singer, Strate wants to use its 18-year foundation of trust to continue building the strength and resilience of the core business, while driving growth opportunities and advanced technologies across new markets.  “It is an exciting time to be an employee of Strate, and this new brand and logo reflect our enthusiasm and focus on serving our customers and markets. The new look better represents where the company is today and embraces our vision for the future. I am glad we can share our journey with you and I am excited for what the future holds.”

Blockchain and the Disruption of Financial Services

Blockchain, the online distributed ledger technology, has the potential not only to fundamentally disrupt the global financial services industry, but also disrupt how monetary instruments and assets are transferred, stored and traded.

 

Leader of Rand Merchant Bank’s ‘Blockchain’ initiative and one of the founders of the bank’s FinTech unit, Farzam Ehsani told a recent forum at the Gordon Institute of Business Science (GIBS), he believes Blockchain technology will be as transformative to our financial system as the internet has been to global communications.

 

Blockchain is a superior database where stored data is encrypted, and access to the data is also encrypted. The distributed nature of the network across many computers means that it has built-in redundancy and transactions are immutable: It is impossible to alter the record, creating a credible audit trail. On the Blockchain, multiple copies of data exist across multiple computers, creating a peer-to-peer network.

 

Use of Blockchain has begun to grow beyond its initial deployment for the Bitcoin cryptocurrency system, as a tamper-proof database that can verify the validity of all transactions.

 

Ehsani explained that until 2009, no one had transferred value digitally from one person to another without a trusted intermediary, such as a bank.  The Blockchain protocol makes use of consensus to build trust, as all the computers in the network have to agree whether a transaction is valid or not. This allows for instant and direct settlements and does away with the need for intermediaries.

 

In the future, financial instruments such as equities, bonds and derivatives, as well as physical assets such as property and cars will be issued onto the Blockchain: “Imagine the possibility of buying or selling a house, and it being transferred into your name, in a matter of not weeks or months, but seconds or minutes,” Ehsani said.

 

“This is not some crazy unbelievable theory, but will become reality in the not too distant future. There is no question this will happen; it is just a matter of time.”

 

Blockchain’s potential to transform the financial services industry post-trade means transactions could be streamlined and simplified so as to cut the costs and counterparty risk associated with clearing and settlement.

 

Ehsani said Blockchain has the ability to disrupt the payments, or value transfer, and value storage offerings that banks currently provide. As value transfer accounts for 40% of total global banking revenue, an opportunity exists for banks to reduce costs.

 

“Block chain will change the financial landscape,” as central banks could be on the Blockchain network and see all transactions in real time Ehsani said.

While cryptocurrencies are currently non-sovereign, several central banks are considering issuing their own virtual currencies onto the Blockchain, so that the potential exists to transact directly with them, bypassing commercial banks.

 

Tanya Knowles, head of Innovation and Projects at Strate, South Africa’s authorised Central Securities Depository, explained: “The world is changing and the way we interact is changing. Blockchain has huge potential, not only to make existing processes faster, but also for the peer-to-peer economy.”

 

While familiarity and adoption of Blockchain technology remains low, Knowles said she believed implementation in emerging markets was likely to be faster, as there aren’t legacy systems and legislation to hold these countries back.

 

Widespread adoption of the technology is still some time away, but collaboration would be crucial to Blockchain’s ultimate success. This includes collaboration with partners across the financial services industry, as well as regulators and central bank authorities.

 

Blockchain is forcing South African financial institutions, which are used to competing for market share to adjust to a new, collaborative paradigm, Ehsani explained: “Most money in the future will be on the Blockchain, regulated by central banks. It will allow for instantaneous payments and smart contracts. But it is still very early days for possible revenue models,” he said.

 

As a technology still in the early stages of its development, Blockchain does have potential pitfalls and unexplored outcomes. The technology is not completely immune to cybercrime, as collusion amongst users could theoretically result in modifications; and regulatory and dispute resolution issues are in their infancy.

 

Ehsani said the socio-political implications of Blockchain are a cause for concern: The potential exists to penalise a country with a lack of computing power and exclude them from the system, which could cripple a small economy.

 

However, at this early stage of Blockchain’s development, Ehsani said the most critical task was to gain a clear understanding of what the Blockchain is: “Don’t be deceived that it is just a technology in its infancy, as you may live to regret your decision,” he concluded.

~ This article appeared in the City Press