2010 LIXI Forum
The Art of Co-operation and Collaboration
Each year the LIXI Forum provides the lending industry with an opportunity to explore and share views on the new, innovative, competitive and exciting approaches undertaken within their collaborative business environments. This year was no different!
The fourth annual LIXI Forum was held on 4th November at the Westin Hotel in Sydney, where industry leaders discussed current challenges and LIXI’s role in improving the manufacture and delivery of mortgages in Australia. The Forum was well attended with representatives from across the industry, including lenders, valuers, conveyancers, broker groups, mortgage insurers and IT providers.
Innovation was the key theme throughout the day, as Christopher Joye, Managing Director at Rismark kicked off the Forum with a provocative presentation on why policymakers need granular information regarding credit facilities at origination and then followed by up-to-date information on the performance of those credit facilities, in order to proactively measure and manage systemic risk. Chris is well known in the industry, and his presentation at the Forum expanded on some of his earlier contributions on proposed standards for analysing mortgage distress, which can be found here.
From a LIXI perspective this presentation highlighted a key point for members to think about - LIXI standards are not in themselves an innovation, but they can, and do, enable innovation. This innovation is not limited to commercial competition but can also enhance the overall financial environment in which our members operate.
Standard Business Reporting
Paul Madden from the Standard Business Reporting unit within Treasury has been very supportive of LIXI’s efforts with our Glossary project over the past 18 months, allowing us to coordinate our development plans to align with theirs. At the Forum, Paul presented some of the key project goals of the Standard Business Reporting project, including how businesses will use data message standards underpinned by a comprehensive taxonomy or glossary to submit financial and accounting reports to numerous government departments.
While we have different stakeholders, the similarities between LIXI and SBR means we will continue to work together in a collaborative manner as we move forward.
LIXI 2.0
The LIXI CEO, Erik Fenna, and LIXI Director Mike Thanos presented a vision of the future of standards, including the mechanisms by which LIXI will deliver on responsiveness to business requirements and the need to control data quality.
Lenders, and in fact all message recipients, already have so-called business rules that are used to validate the data messages. The new LIXI 2.0 architecture will permit the recipient to be in direct control of the business rules through a remote publish capability. LIXI 2.0 has the capability of delivering exponential increases in data quality and efficiency to the mortgage lending process. This requires a fresh take on the glossary (just like the Treasury’s requirements) and a new streamlined schema.
Fundamental to the whole project is the absolute need for incremental change and support for any-to-any message delivery. No wholesale changes to the current implementations are proposed, and the need for true interoperability means more than a common XML schema standard. It means that the business rules for lodgement need to be portable and publishable in a machine-ready format.
The eternal conflict between core IP and collaboration
Telstra’s Dr Michael Neary presented a thought-provoking case on why, where and how to co-operate, compromise or compete, challenging assumptions of whether competitive advantage really is threatened when information or IP is shared.
The key take-away was demonstrating that what may be perceived as core IP is not always core to the business. The case study was a gold producer that openly published all their geological data on line, sponsoring a competition to find the gold in ‘them thar hills’. The geological data wasn’t the core IP that people thought, the real prize was the gold!
The Panels
There were three excellent panels, covering the CIO’s view of standardisation versus agility; standards in securitisation reporting; and the annual blue sky panel.
Steve Shipley led off with the CIO’s panel, starting with an analysis of the relationship between the benefits of standardisation and the need for agility. Can you have both? According to Steve there is a sweet spot, and the panellists agreed, although it clearly takes more than just good intentions to make it happen. Good planning and clear goal setting is essential.
Alex Sell and the Australian Securitisation Forum have developed standards for the data exchange between issuers and investors in securitised lending, used in the pre- and post-issuance reporting. As yet not everything is standardised, with the panel exploring how arrears and defaults have at least a dozen definitions and why standards for electronic messaging have not yet been designed. However, the indications are that ratings agencies and investors will appreciate the standards, and the issuers will benefit in the end.
The blue sky panel was more animated than ever, as panellists gave somewhat divergent views on the industry, drawing the audience into the debate. The final conclusion - the outlook for collaboration and message standards looks excellent, but there is always an opportunity for regulation to get in the way of collaboration.
Networking and Community Building
Finally, an important part of the LIXI Forum is the opportunity for members to network with other members and industry participants. As a community we have a common goal of driving our industry towards greater electronic integration. It is through events like the LIXI Forum that we can all contribute to this goal.
Thanks
Many thanks to all our speakers and sponsors including our Gold sponsor NextGen.Net, Silver sponsor Espreon, and event sponsors PriceFinder, LeadPoint, RP Data and Fiserv. Thanks to all who attended to make the event such a success and we look forward to seeing you at the next LIXI event.
Click here to see the speaker presentations from the day.
Contact us
If you have any comments or enquiries about this newsletter or any other aspect of LIXI, please contact one of the following people:
General enquiries: Lisa Mills
All other enquiries: Erik Fenna
LIXI@Work is keen to hear from members with implementation experience or other news. If you would like to share any insight with the LIXI group please email us.
