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Home » Daily Briefing » Daily briefing - 15 May 2017

Daily briefing - 15 May 2017

It's deja vu all over again in Dublin, where 16 luxury homes newly released to the market at 3pm on Thursday were sold out by 6pm. Prices ranged from €660,000 to €900,000 but demand has outstripped supply, and the good times look to be back for Irish developers. On cue, JP Morgan announced plans to hire a significant number of people in Dublin. "The US bank currently employs 500 people in the Irish capital in custody and fund services, transaction services, and technology and operations. It will hire a "significant" number of people for the custody and fund services business over the next three years, said James Kenny, JPMorgan's head of investor services. JPMorgan is about to buy a 130,000 square foot space in a landmark Dublin development called Capital Docks, which could accommodate more than 1,000 people. The move was initially linked to the UK's Brexit vote, as US banks seek alternative routes to the EU once Britain leaves the bloc." Is a new financial centre about to spring up on the banks of the Liffey?


That's certainly the case in Addis Ababa, where a great new financial centre is rising to the east of the National Bank of Ethiopia. Awash Tower is the first standing, with several more under construction. Yesterday, the country's prime minister, Hailemariam Desalegn, was among the leaders gathered in China for the Belt and Road Forum. The 'Road' part of the massive China-funded infrastructure project is actually the sea lane to East Africa, and it's well known that China is building ports and railroads across East Africa. Chinese software and telecommunications technology will support a leap forward for Ethiopian banks now building their new headquarters in Addis — the construction of the new, state-owned Commercial Bank of Ethiopia is pictured here. With the National Bank of Ethiopia mandating that the two state and 16 private banks modernise core banking systems and link to the national payments system, the country's banks are installing new core systems and planning a big push for digital payments. Much will be enabled by China, where mobile banking has leapt ahead of the rest of the world. Telco shops are everywhere, this writer noted on his visit last week, selling low-cost Chinese smartphones that are now being manufactured in Ethiopia.

And who is building the telecoms infrastructure to support this digital revolution? Huawei, the same company that built Addis Ababa's new light railway. Huawei recently announced it will support the Finacle core banking system — popular across Africa — with a cloud solution. One-sixth of the world's banked population currently relies on Finacle, according to Richard Longo of Infosys Finance. Huawei's cloud technology will compete globally with Amazon and Google. Ethiopia's mobile and data services are currently run by state-controlled Ethio Telecom, which will serve as a key link in the new banking system as Ethiopians upgrade to smartphones and mobile banking. Where, one might ask, are the Americans in all of this? Have Amazon, Microsoft and Google already lost the battle for cloud supremacy in Africa's second most populous nation? Perhaps. Under the current state of emergency, Facebook and WhatsApp are blocked inside Ethiopia. The advance of Chinese software will be crucial to the future of Ethiopian banking, one commentator noted. With WeChat Pay and Alipay storming the Western world, one would not bet against the Chinese when it comes to mobile finance.

Readers of Lafferty News will recall that we have briefed urgently about the wide scope for abuse through data surveillance and cyberintrusion: we're big fans of the Zero Days documentary by Alex Gibson. This weekend, businesses across the world reel from cyberattacks through the WannaCry ransomware, which was re-purposed from the hacking software used by intelligence agencies. This story originated in Zurich's Das Magazin back in December of 2016 and we brought it to you in February. The Guardian follows up on that story this weekend, and if you've not read it yet, we recommend that you read it now. We're caught now in a world where banking desperately needs data, but even data is political. Some people argue that PSD2 and GDPR (data protection regulations) are the European front against the US's dominance of the world of data. There's much to fight for in the coming months.

UK: Neil Woodford sold Glaxo and bought Lloyds
Banks overconfident about capital, accountants warn [FT paywall]

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