Chief Executive of Swiss financial services providers UBS Group has put his weight behind blockchain technology which he says is essential for business.
Speaking to CNBC on Monday, Sergio Ermotti, the CEO of the Financial service giants identified blockchain as a technology that reduces running costs thereby improving the efficiency of businesses.
During the interview, he said that the only way a company can stay relevant in an industry that is continually under pressure in terms of gross margin was by pricing its products correctly. This ability he noted this ability to rightly price its offerings is more important than other factors like its capital strength, the quality of the personnel, products, and services.
[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]”It’s almost a must. The freeing up of resources to become more efficient will come through technology and blockchain is a great way to allow us to … reduce costs,” – Sergio Ermotti CEO, UBS[/perfectpullquote]
Ermotti believes that blockchain, more than any other technology, will help businesses save more money and become more efficient.
He also noted that the emerging technology will play a major role in years to come. According to him “[blockchain] will be as crucial and disruptive, and changing as regulation was in the last 10 years.”
Though an advocate for blockchain technology, Ermotti is not a huge fan of cryptocurrencies and has in the past expressed reservations about bitcoin and other cryptos. In October 2017 when he was similarly interviewed, he said that cryptocurrencies needed to be defined but blockchain was already on course to reshape the financial industry. The top guns within the UBS seem to have a mutual dislike for cryptos; Chief investment officer Mark Haefele and Chief economist Paul Donovan expressed skepticism over bitcoin and other cryptocurrencies.
He also described the company’s approach towards blockchain as simple and collaborative. He said, “We try to initiate and get as many other financial institutions and clients into teams like trade finance with other banks and IBM was a successful venture.” UBS have collaborated with IBM for Batavia, a blockchain platform, built on the open-source Hyperledger Fabric framework. Bank of Montreal, CaixaBank, Commerzbank and Erste Group have joined the platform.