Swift has announced the first successful testing of its FpML messaging service on SwiftNet. Barclays Global Investors successfully managed to send contract notifications over the wire to the custodian Brown Brothers Harriman. Swift have also said that State Street (on behalf of PIMCO) are also in the testing stage with a number of other custodians including Northern Trust, BoNY and Mellon.

This is an important step for the Swift organisation. They announced a year ago the formation of a Closed User Group to start moving these messages over SwiftNet in collaboration with ISDA and this is the first time that anything concrete has been announced about its progress. Although you can currently automate some of the post-trade processes necessary for OTC usage (using SwiftNet Affirmations for instance) Swift clearly see that the future in this area of the industry is not in their own propietary messaging formats but with FpML. Although this announcement is evidence only that they have managed to send contract notifications over the wire they are also in the process of setting up tests for trade confirmations and portfolio statements