Software and consulting specialist to the banking and asset management sector, LPA has commenced the process to fully assimilate its AI division AAAccell into its overall business. AI solutions will increasingly feature as part of total consulting solutions or total software products rather than as stand-alone approaches to commercial challenges.
The first step in evolution is that Sandro Schmid will now take the role of lead consulting partner in Switzerland. This boosts the Swiss consulting team and also adds capability enabling the whole group to more fully leverage Sandro’s skills in AI, Risk, and Digitalisation.
Sandro believes this logical step is necessary to leverage the synergies for AI across all the solutions of the growing LPA group. Metaphorically speaking, this reorganisation will help ensure that the 1+1 (of LPA and AAAccell) is greater than 2. Although focusing on Switzerland, Sandro will have a Global remit in delivering AI solutions etc. across all LPA group clients.
AI and intelligent digitalisation will remain a focus for Sandro. At first, adoption of AI in the financial sector was rather slow as the market was somewhat sceptical seeing it sometimes as hype. Now, AI is broadly seen as a very powerful technology that our clients must adopt or they risk losing market presence. The medium term question is how and where to apply AI to best effect and how to combine it within a fully end-to-end digital processes. This is a question Sandro believes can be best answered through combining domain expertise with technological understanding. Therefore, LPA’s consulting combines traditional regulatory know-how with deep IT technical understanding to adopt new technology such as AI or cloud computation or big data. As AI can be a positive augmentation for e.g. risk systems compared to traditional quant solutions like logistic regressions, highest returns are achieved combining it with new (alternative) data that improves analytics and predictive capabilities. Additionally, IAAI – Intelligent Automation with AI enables not only to develop better methods and tools but also to stream-line processes towards 24/7 banking. The consulting approach is to offer advice helping clients move to the next level in digital transformation journey.
ESG (Environmental, Social, and Governance) covers the three central factors in measuring the sustainability and social impact of investments or other financial products. ESG criteria are set to become more important in determining the future financial performance of investments. Currently there exist a number of ratings for ESG performance which are generally provided by the established ratings agencies. These however have problems: Firstly, organisations can apply these in various ways. This sadly has led to a lack of comparability and reliability. Secondly the ratings themselves, lack transparency and are mostly not applicable to new EU taxonomy which weighs heavily on current solutions. The net result is that the market still lacks a robust long-lasting solution for sustainable finance. The recent EU Study on Sustainability-Related Ratings, Data and Research outlined this problem. Sandro’s theory is that AI can partially solve this, as it is also stated in the EU study. By looking at the mass of data openly available (newsfeeds, published reports etc.) an individual, comparable and transparent ESG rating can be developed.
As regulations within our industry continue to grow and change, the effort required for financial institutions exponentially. But instead of continuously growing FTE’s, AI can streamline and reduce manual, monotonous work. Primarily, NLP as sub-category of AI, can be used to support compliance teams in their daily work but switching their time to material regulation rather scanning unnecessary regulatory text or news. By adding a logic, AI machines reading regulations and extract changes, relevant news and even support to identify compliance logics. The current tool works and even beats current Stanford University’s NLP tool. The algorithm for this and a related AI driven pension fund platform was completed last month and is in use with SIX in Switzerland.
About the LPA Group
The LPA Group is one of the world’s leading developers and consultants for technology-based capital market solutions (CapTech) for banks, insurance companies and fund providers. The core business of the multi-award-winning group is the CapTech suite, a portfolio of leading technology solutions for automated consultancy, sales and documentation for financial instruments, structured products and OTC derivatives. The products and services of the LPA Group help financial services companies in their capital market activities to automate their necessary advisory and regulatory documentation processes, thereby increasing their efficiency and achieving full compliance. The LPA Group also advises its customers on the strategic planning and implementation of CapTech solutions. At its headquarters in Frankfurt and at ten other international locations including Tel Aviv, London, Zürich, New York, Paris, Barcelona and Singapore, almost 400 technology and capital market experts are now working for a portfolio of international clients.
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