A bankruptcy filing trumps payments technology news, even at a payments conference.At SIBOS, the enormous global payments conference in Vienna that started this morning, no one is talking about payments. Everyone, obviously, is discussing the latest news about another once proud financial organization that has been brought to its knees by the credit crisis, a second financial behemoth looking for loans and selling assets, and two banks joining forces in order to survive.
On a day when many exhibitors send out press releases on the latest technology offerings or new contracts with clients, most reporters (like me) would rather ask questions about Lehman Brothers and what integrations challenges Bank of America faces now that it has purchased Merrill Lynch and it work to integrate two vastly different and large firms. So, the product announcement will have to wait. Talk about bad timing, from a PR person's point of view. (So, I apologize to all of the vendors and PR people who were hoping I would mention their product news in my blog today. I'll get to that later today).
Lehman Brothers was in very bad shape, obviously. Last week, Lehman reported that clients were still sticking by the firm and doing business with it, despite all of the rumors. Today, however, the bankruptcy filing may force clients to route business elsewhere, if only to cover their own liabilities in case something goes wrong during bankruptcy. One former executive from Lehman who still has many friends at the firm, thought this outcome inevitable and was surprised the firms lasted as long as it did.
The news of BofA getting back into investment banking by adding Merrill Lynch was a little of a surprise, especially since the bank announced it was getting out of investment banking. One vendor joked that there won't be many integration problems since there isn't much of an investment bank remaining at Bank of America anyway. Still, noted David Hodgekinson, group chief operating officer at HSBC, integration of separate companies is always difficult. (Look for my video interview with Hodgekinson later this week at www.wallstreetandtech.com/video.)The Lehman bankrptcy filing and BofA's purchase of Merrill Lynch trumps payments technology news, even at a payments conference. Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio