But IT managers at those firms say the potential for XML to become an open Web interface that allows financial services companies and their clients to share data will not be fully realised until the industry settles on a single standard.
Most of the delegates at the XML on Wall Street conference said they believe that standardisation will emerge only if the securities industry and suppliers agree to map their efforts around the ISO XML data dictionary, which defines data descriptors.
"Having separate standards now will be talked about in the future as being as insane as each of us having our own forms of TCP/IP. As financial institutions, we have to do more to co-ordinate those standards," said Russ Goring, deputy chief information officer at Dresdner Kleinwort Wasserstein, the investment banking arm of London-based Dresdner Bank AG.
Dresdner Bank has an internal XML strategy. Overall, 42% of companies in the global financial services industry have such strategies in place, according to Jean-Francois Abramatic, chairman of the World Wide Web Consortium (W3C). Another 36% of companies in the industry have plans to implement XML as a middleware application.
"Systems integration and sharing data are the most important reasons to use XML," said Abramatic, whose group is still working on XML Web services standards and protocols. "Vertical applications are the challenge of the day."
Other delegates at the conference acknowledged that they knew little about XML but wanted to jump on the bandwagon.
Shari Ball, director of information services at American Capital Access, a New York-based company that insures municipal bonds, said her firm recently bought 12 news, exchange and calculation applications that should help its financial analysts weigh bond risks.
Ball said she hopes XML will allow her to knit the applications together for a single view of the bond and credit information.
Eli Bayajian, American Capital's chief information officer, said he would also like to populate a newly created SQL database with XML data feeds.
XML lets American Capital's financial advisers and analysts generate bond rating reports from news, stock and bond service feeds such as those of Bloomberg LP and Moody's Investors Service.
"We spent a lot of money buying those services, so we need to make them work well," Ball said. "We need to deliver them as one type of desktop application, so analysts can review all the companies' information to determine if we want to buy bonds from them."
Pan Gu, an application developer in the market risk division of New York-based JP Morgan, said he is looking for tools that will allow him to tie together internal systems. Still, he is having a hard time convincing his manager that middleware is needed.
"How do you convince a manager to spend the money?" he said. "If you're building a standalone application that's not getting data from an external system, it's pretty hard to sell. The problem is that if you want to use XML, everyone [in the industry] has to be on board."