Global expansion, improved technology, and shifting market forces are driving middle market commercial and small business banking clients to become more sophisticated in their bank communication requirements. This presentation provides an overview of industry trends, SWIFT adoption drivers and explores deployment alternatives for regional banks.

1. Patricia Hines, CTP
Director, Financial Services Industry Marketing, GXS
Focus on Regional Banking:
Meeting the Connectivity Needs of Increasingly
Sophisticated Commercial Clients

2. September 5, 2013 | Slide 2 © 2013 GXS, Inc.
About GXS
Industry Trends
Connectivity Options
SWIFT for Corporates
Regional Bank Case Studies
Q&A
Session Agenda

3. September 5, 2013 | Slide 3 © 2013 GXS, Inc.
Treasury & Cash
Management
Card Issuing &
Merchant Services
Trade & Commercial
Finance
• Integrated Payables
• Consolidated
Receivables
• SWIFT Connectivity
• Multi-Bank
Payments
• Merchant
Enablement &
File Integration
• PCI Compliance
• ERP Integration
• Factoring
• Supply Chain
Finance
• Inventory Finance
• Dealer Floor
Planning
GXS in the Financial Services Sector
Enabling Connectivity and STP Across Industry Segments
Securities
• Connectivity for
Counterparties
• Order to Settlement
Lifecycle
Management
• Post-Trade
Exceptions
Group Benefits &
Employer Services
• Client Integration
for Group Insurance
• Payroll File
Transmission
• Claims Payment
Remittances

4. September 5, 2013 | Slide 4 © 2013 GXS, Inc.
Industry Trends

5. September 5, 2013 | Slide 5 © 2013 GXS, Inc.
• Maintaining Liquidity: Ensuring the company is able to meet current
and future financial obligations
• Optimizing Cash Resources: Minimizing non-earning cash balances
while providing adequate liquidity, and maximizing use of excess cash
balances
• Maintaining Access to Financing: Establishing financing alternatives
for working capital (short-term borrowing) and capital raising (medium to
long term debit or equity)
• Managing Controls and Risk: Monitoring and controlling exposure to
interest rate, foreign exchange and other financial risks
• Managing Bank Relationships: Selecting financial services providers,
monitoring provider performance, managing day-to-day operations
Treasury Managers Wear Lots of Hats

6. September 5, 2013 | Slide 6 © 2013 GXS, Inc.
How do Corporates Connect to their Banks?
ERP Systems –
SAP, Oracle
Treasury Management
Work Stations
(TWS/TMS)
File Formats Multiple Banking
Relationships
Payments
Leased Line
Web Portal
Internet FTP
B2B Gateway
Connectivity
Options
Corporate-to-Bank Connectivity (C2B)
Cloud-Based ERP and
Accounting Solutions
Business Accounting
Software

7. September 5, 2013 | Slide 7 © 2013 GXS, Inc.
Corporate Treasury Technology Spectrum
Implications for Corporate-to-Bank Integration
Note: SaaS = software as a service, eBAM = electronic bank account management.
Exhibit #: 66:07W-E1
 Heavy use of specialized
treasury technology and
ERP solutions
 Use of intraday bank
feeds for cash position,
liquidity management
 Multibank payment
initiation files and use of
online for exceptions
 Emerging need for
frequent status updates
 Increasing use of
integration for trade
finance activity
Large Corporate
 Use of statements/
online banking reports
to reconcile with
accounting system
 Initiation of payments
online or through
service bureau
 Heavy reliance on
spreadsheets
 Minimal use of bank
data files to update
accounting package
Basic Cash
Management
Operations (SMEs)  Growing adoption of
technology for cash
management and
forecasting (SaaS)
 Use of daily bank feeds
for reconciliation (online
and/or B2Bank
connectivity)
 Initiate payments (online
and/or B2Bank)
 Reliance on lead bank
for multibank reporting
Middle-Market Treasury
with Primarily Domestic
Operations
 Multibank integration
 Many banking
relationships across
multiple regions
 Focus on managing
global liquidity positions
 Demand for consistent
use of global standards
 Reliance on treasury
system for controls,
workflow, and “single
source of truth”
 Demand for eBAM
 Integration for more
complex services (e.g.,
trade confirmations)
Complex Global
Treasury
Customers’ Increasing Sophistication and Needs
Source: TowerGroup, B2Bank Integration: Ignore One-to-One Connectivity at
Your Peril, Susan Feinberg, 01/31/11, Ref # V66:07W

8. September 5, 2013 | Slide 8 © 2013 GXS, Inc.
22,110
3,575
968
617 475
82
17
Number of US Firms (Thousands)
Non-Employer Firms 0 to 4
5 to 9 10 to 19
20 to 99 100 to 499
500 or more (large businesses)
5,9266,359
8,288
18,554
15,869
54,997
Number of Employees
Small Businesses Are More Plentiful, but
Larger Businesses Dominate

9. September 5, 2013 | Slide 9 © 2013 GXS, Inc.
Middle-Market and Small Business Clients
Drive Revenue for Tier 2 Banks
Large
Corporate
Middle
Market
Small
Business
Top 5 29% 27% 13%
Next 15 26% 32% 18%
Peers 2 & 3 13% 40% 35%
2011 Total 26% 30% 17%
Share of fee-equivalent
revenue by customer segment
Source: Ernst & Young 29th Annual
Cash Management Services Survey
Source: GE Reports

10. September 5, 2013 | Slide 10 © 2013 GXS, Inc.
Revenue from Electronic Products driving
Cash Management Growth
11.0%
-6.0%
-3.0%
-2.5%
0.5%
-0.5%
0.5%
1.5%
3.5%
6.0%
11.0%
-9.0%
-6.0%
-3.0%
0.0%
3.0%
6.0%
9.0%
12.0%
Check CDA DDA RLBX C&C WLBX ARP Info Rpt ACH/EDI Wire P Card
Source: Ernst & Young 29th Annual Cash Management Services Survey
Revenue growth rates for cash management products

11. September 5, 2013 | Slide 11 © 2013 GXS, Inc.
Payment Products Used in North America
Corporates with less than $1B in revenue
6%
15%
16%
17%
18%
27%
30%
32%
32%
34%
43%
53%
58%
90%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Mobile payments
SEPA direct debit
Other local or niche products
Bankers drafts
Online payment services providers
Bank checks
Same day ACH
Travel & entertainment cards
Purchasing cards
SEPA credit transfers
ACH debits
Checks
ACH credits
Bank wire transfers
Source: gtnews 2013 Payments Survey

12. September 5, 2013 | Slide 12 © 2013 GXS, Inc.
Corporate-to-Bank Connectivity Options

13. September 5, 2013 | Slide 13 © 2013 GXS, Inc.
What are the Challenges?
Backlog & Slow
Client On-Boarding
Multiple File
Formats
Complex
Connectivity
Aging In-House
Technology
New Product
Development
An external service provider can easily adapt to changing
business conditions such as new clients, technologies,
acquisitions, transaction types, etc.
Data integration is challenging, complex and costly to
implement and maintain. We shield this complexity and
reduce overall costs, while improving business performance
Clients with unique file formats, communications protocols,
security needs and testing requirements require
integration experts to handle complex onboarding.
Managing clients across industry segments and
geographies results in multiple file formats and transaction
types with different business rules.
Connecting and on-boarding new clients takes months,
often resulting in backlogs. We can help to accelerate
time-to-revenue.

14. September 5, 2013 | Slide 14 © 2013 GXS, Inc.
Challenges with Bank Interfaces
Treasury Organizations Want Real Time Information & Payment Execution
Traditional Bank Interfaces
Unique
connection and
file format for
each banking
relationships
Connectivity,
testing and
certification
required for each
bank
Leased
Line
Web
Portal
Internet
FTP
Fax
Standards Complexity
• Inflexible file format options and lack of ERP
integration (SAP, Oracle)
• Limited internet protocol support for AS2, MQ,
HTTPS, SFTP
• Rigid security policies (encryption, firewalls,
audits)
Operational Constraints
• Performance and capacity constraints
• Lengthy implementation times
• Limited knowledge of corporate ERP
• Varying capabilities and support processes
across differing regions (Asia-Pacific, Latin
America)
Lack of Integrated Interfaces
• Reconciliation challenges
• Limited visibility to cash and payment status
• Distinct interfaces per product line (Cash, FX,
Trade Finance, Securities Services )

15. September 5, 2013 | Slide 15 © 2013 GXS, Inc.
Multiple C2B Integration Options
Direct Integration (DIY) Concentration Bank Integration
SWIFT Integration Hybrid: SWIFT & Direct Integration
SWIFT
Service
Bureau
C2Bank
Integration
Service
Higher TCO, multiple standards
Constrained by bank’s capabilities
SWIFT bank data through concentration bank
Bank neutral, limit is bank SWIFT readiness
May use SWIFT Service Bureau
Lower TCO, global reach
Bank neutral, maximum flexibility

16. September 5, 2013 | Slide 16 © 2013 GXS, Inc.
SWIFT Corporate Access
A Single Global Standard
Post
Web
Portal
Internet
FTP
Fax
FX
Confirmations
Investment Trade
Confirmations
ACH Payments
Wire Payments
Prior / Current
Day Statements
Prior Day
Balances
Company Financial Systems
Treasury A/P
A/ROther
Multiple Connections & Formats
Bank Mandates
Signature
Cards
FX
Confirmations
Investment Trade
Confirmations
Bank Mandates
Signature
Cards
Company Financial Systems
Treasury A/P
A/ROther
Standard Connections & Formats
ACH Payments
Wire Payments
Prior / Current
Day Statements
Prior Day
Balances

17. September 5, 2013 | Slide 17 © 2013 GXS, Inc.
What is SWIFT?
Society for Worldwide Interbank
Financial Telecommunications
• Consortium of member financial
institutions
• Started in 1973 to automate the telex
• Premier financial messaging standards
body
• Powers real-time gross settlement
systems globally called “market
infrastructures”
• >2.5B messages exchanged between
10,000+ financial institutions and
corporates in over 210 countries – largest
financial messaging network and
community in the world
• SWIFT develops and defines messaging
and standards for the financial services
industry
Source: SWIFT Standards Overview
Market Infrastructures
• Central Banks
• Settlement Systems
Customer Solutions
• TRCO
• MA-CUG
• SCORE
SWIFTNet
• 10,416
Correspondents
• 213 Countries
SWIFT Solutions
• FileAct
• Accord
• Trade Services Utility
• … and more
Secure
Financial Messaging
Global Financial
Standards
“The global provider of secure financial
messaging services”

18. September 5, 2013 | Slide 18 © 2013 GXS, Inc.
SWIFT for Corporates Adoption

19. September 5, 2013 | Slide 19 © 2013 GXS, Inc.
Trends Driving SWIFT Adoption
Interest in SWIFT
Emerging Standards Better Risk
Management
Improved Cash
Management
Infrastructure
Changes

20. September 5, 2013 | Slide 20 © 2013 GXS, Inc.
• Corporate Drivers
– Increased SWIFT marketing
– Growing adoption among
corporates
– Single network to streamline
messaging and formats
– Centralizing treasury operations
– New products: AllianceLite2,
3SKey, eBAM, SWIFTRef,
Watch Analytics
Interest in SWIFT

21. September 5, 2013 | Slide 21 © 2013 GXS, Inc.
• Corporate Drivers
– Better visibility and more efficient
deployment of cash
– More frequent reconciliation of
balances
– Grow balances through interest rate,
currency hedging, derivatives, etc.
management
Improved Cash Management

22. September 5, 2013 | Slide 22 © 2013 GXS, Inc.
• Corporate Drivers
– FIN MT to MX message
standard evolution
– ISO 15002 to ISO 20022 for
Corporate Actions
– European Union’s migration
to SEPA compliant
payments
Emerging ISO 20022 XML Standards

23. September 5, 2013 | Slide 23 © 2013 GXS, Inc.
• Corporate Drivers
– Simplifying, optimizing, and/or
diversifying banking relationships
– Being more nimble to make
changes
– Sensitivity due to Global Financial
Crisis of 2008
Better Risk Management

24. September 5, 2013 | Slide 24 © 2013 GXS, Inc.
• Corporate Drivers
– Upgrading or consolidating
treasury technology infrastructure
– Replacing Treasury Management
System
– Marketing influences from SWIFT
(Alliance Lite2) and other Service
Bureaus
Infrastructure Changes

25. September 5, 2013 | Slide 25 © 2013 GXS, Inc.
187
282
402
579
726
902
1,035
2006 2007 2008 2009 2010 2011 2012
Growth Driven by Corporate Adoption of
SWIFT
Number of Registered
Corporate Entities on SWIFT
Source: SWIFT

26. September 5, 2013 | Slide 26 © 2013 GXS, Inc.
SWIFT for Corporates Geographical Split
72%
19%
9%
EMEA Americas Asia Pacific
Source: SWIFT

27. September 5, 2013 | Slide 27 © 2013 GXS, Inc.
4.0
4.4
4.6
5.0
2010 2011 2012 2013 Est
SWIFTNet FIN Annual Traffic
Millions of messages
Growth in SWIFT Messaging
Driving Adoption by Corporates of All Sizes
+ 3.6%
+ 9.9%
SWIFTNet FileAct Traffic
Average daily kilocharacters
Source: SWIFT in Figures
3.9
5.0
6.9
7.7
2010 2011 2012 2013 est
+ 28.8%
+ 76.4%
+ 8.7% + 53.9%

28. September 5, 2013 | Slide 28 © 2013 GXS, Inc.
SWIFT for Corporates – Beyond Payments
Business area Description Details Messages
Payments High-value & bulk
payments
Local formats and FIN
MT formats
FIN MT 101
FileAct for all formats
Bank Account Reporting Intraday and end-of-day
statements
Account statements
available in MT or
ISO20022 format
FIN MT 9xx
File Act for all formats
Bank Account
Management
Account-opening,
account-closing and
reporting
Electronic management
with ISO20022
FileAct and ISO 20022
Exceptions &
Investigations
Processing of
investigations
STP and efficient
processes
FileAct and ISO 20022
Trade Finance LCs, Guarantees One message for all
needs
FIN MT 798 and/or
FileAct
Foreign exchange deals Deal confirmations Optional matching FIN MT 3xx
Securities Orders, corporate
actions, etc.
All processes covered
with FIN messages
FIN MT 5xx
Source: SWIFT

29. September 5, 2013 | Slide 29 © 2013 GXS, Inc.
SWIFT Connectivity Options

30. September 5, 2013 | Slide 30 © 2013 GXS, Inc.
Alliance Access
Alliance Access
SWIFT Alliance Solution SetInstitutionSize/MessageVolumes
Automation, Integration, Customization
Alliance Lite2 Alliance Gateway
SWIFTNet Link
HSMs
Alliance Messaging Hub (AMH)
Alliance Access Integration Platform
Source: SWIFT

31. September 5, 2013 | Slide 31 © 2013 GXS, Inc.
SWIFT Connectivity Options
• Customer-Owned
– Specific security requirements
– Full control over IT environment
including data storage
– Supports high traffic volumes
• Outsourced “Off-the-Shelf”
– Clear ramp-up path
– "Peace-of-mind" solution
– Scalable to your needs
• Outsourced Tailored
– IT environment managed by third party
– Using a shared infrastructure is not
critical
– Traffic requires medium to high volume
infrastructure
Source: SWIFT

32. September 5, 2013 | Slide 32 © 2013 GXS, Inc.
SWIFT Outsourcing Trends
66%
26%
8%
Service Bureau
AllianceLite / Lite 2
Member-Concentrator
Source: SWIFT

33. September 5, 2013 | Slide 33 © 2013 GXS, Inc.
Alliance Lite2 – How it Works
Source: SWIFT

34. September 5, 2013 | Slide 34 © 2013 GXS, Inc.
Leased
Line
Alliance Web Platform
SWIFT Interface
VPN Box
SAA
ALLIANCE ACCESS
SAG
SWIFT
ALLIANCE GATEWAY
HSM Box
SNL
SWIFT Net Link
Visibility & Message
Management /
Monitoring
SWIFT Alliance Access
Solution Components
Client Systems
Licensed from SWIFT
• Primary Dual leg HA
• DR Infrastructure
• Both have 2 leased lines
to SWIFTNet
SOAP

35. September 5, 2013 | Slide 35 © 2013 GXS, Inc.
Choosing a SWIFT Service Bureau
• Can be daunting – almost 120 organizations worldwide have service
bureau offerings
• SWIFT recently rolled out a new Shared Infrastructure Programme
(SIP), to certify service bureaus that offer third-party connectivity to the
SWIFT network
• A list of SWIFT Service Bureau meeting the various operational levels
defined by SIP can be found using SWIFT’s Partner Locator

36. September 5, 2013 | Slide 36 © 2013 GXS, Inc.
Regional Bank Case Studies

37. September 5, 2013 | Slide 37 © 2013 GXS, Inc.
Single-Sign On / Multi-Factor
Authentication Portlet
Large Regional Bank
Extending Capabilities to Small/Medium Enterprises
Messaging Service
DataPool
(Unisys)
CIPG
(EG)
Customer Communication Facility
(CCF)
Bank
Online Banking for
Business Portal
Business Issue
• The bank wanted to extend the ability to upload payment files
and download information reporting files to small to medium
enterprises (SMEs)
• Legacy solution called File Transfer Facility (FTF) no longer
supported by vendor
• Need for low-cost Internet solution for small to medium business
customers not able to exchange files using machine-to-machine
solutions
• Multi-factor authentication required to comply with FFIEC
standards for online security
• Requirement for single sign-on to FTF solution through bank’s
online business banking portal
Solution Deployed
• Deployed Intelligent Web Forms (IWF) and Trading Grid for Excel
(TG4E) in the bank’s messaging service to provide SME client
access for file transfer
• Implemented multi-factor authentication and single-sign to allow
the bank’s clients to access the new file transfer client access
tools through the bank’s online cash management portal
Bank Clients

38. September 5, 2013 | Slide 38 © 2013 GXS, Inc.
Top Tier Global Bank
Overcoming Legacy System Limitations
Business Challenge
• This global bank’s core deposit system can
only generate information reporting (current/
prior day) in BAI2 format.
• Multi-national corporate clients require SWIFT
formatted files for integration with their back-
office financial systems
GXS Solution
• Translation from BAI2 to MT940 / MT942
• Delivery to clients via SWIFT Service Bureau
using SWIFTNet File Act
Business Benefits
• Outsourcing corporate on-boarding = faster
time to revenue
• Translation into global formats improves ability
to win multi-national corporate business
• External SWIFT solution eliminates need for in-
house hardware, software and technical staff
Corporate Clients
Managed Services
SWIFT
Service Bureau
BAI2
MT940
MT942
SWIFTNet File Act

39. September 5, 2013 | Slide 39 © 2013 GXS, Inc.
US Regional Bank
Winning Large Corporate Clients
Business Challenge
• Meeting SWIFTNet delivery and SWIFT
format requirements of multi-national
corporate clients for wire payments and
balance reporting
• Bank applications unable to consume
SWIFT formats
• Imminent go-live deadline
GXS Solution
• File translation
 MT101 – EDI 820
 BAI2 – MT940 / MT942
• Connectivity via SWIFT Service Bureau
• Corporate on-boarding
• Enables additional large corporate
business
Corporate Clients
SWIFT
Service Bureau
MT101
Managed Services
MT940
MT942
820 BAI2

40. September 5, 2013 | Slide 40 © 2013 GXS, Inc.
Take-Aways
• Middle market commercial and small business banking
clientele have more sophisticated bank connectivity
requirements
• To meet these requirements,
regional banks must be well-
versed in the complexity of
corporate-to-bank
connectivity
• Ever-evolving financial
messaging standards
increase the complexity on an
ongoing basis

41. September 5, 2013 | Slide 41 © 2013 GXS, Inc.
To Learn More
General Information:
• Corporate-to-Bank Connectivity: http://www.corporatetobank.com
• SWIFT for Corporates: http://www.swift.com/corporates
• gtnews SWIFT Service Bureau Buyer’s Guide:
http://www.afponline.org/pdf/2013_gtnews_SWIFT_Buyers_Guide.pdf
Formats:
• ISO 20022 for Dummies: http://www.iso20022.ch/iso_dummies.pdf
• SEPA Overview: http://www.europeanpaymentscouncil.eu
• SWIFT Common Global Implementation (CGI):
http://www.swift.com/corporates/cgi/index
• Balance and Transaction Reporting Standard (BTRS):
https://www.x9.org/btrs

42. September 5, 2013 | Slide 42 © 2013 GXS, Inc.
Thank You and Q&A
Patty Hines, CTP
Director, Financial Services Industry
Marketing
Office: +1 704 969 0763
E-mail: patty.hines@gxs.com