
Obstacles to Innovation in Fixed Income – Grant Wilson / Byron Cooper-Fogarty (Tabb Forum)
March 17, 2017 \
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Full Article: Tabb Forum
The market seems to broadly agree that innovation is the best way to resolve the problems presented by these pressures and their impact on profitability. As demonstrated by the small number of established utilities or successful fintech start-ups, however, this often is more difficult than it looks.
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4 Comments on "Obstacles to Innovation in Fixed Income – Grant Wilson / Byron Cooper-Fogarty (Tabb Forum) "
The elephant in the room is (in)vested interests. In getting a large number of banks to work together on an initiative larger banks often own stakes in the incumbent market infrastructure firms. While these banks own business or clients may acknowledge problems with the incumbents the bank’s ownership stakes are an effective inhibitor to change or adoption. In part this article skirts around the core question: does bank strategic investment need to evolve from a profit center to an innovation facilitator? Sticking with the former won’t help the realization of much innovation.
In reality what this article highlights is it is easier for people to make noise about something that they feel is wring than actually support change through actions and as has been highlighted investment. Change does not happen overnight but it does not happen at all if the apathy of the market remains. Easier to talk about something than invest the time and money in what can be a painful process of change. I see thee incumbents happily in control for a long time to come.
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