SFS: The evolving world of securities finance
10 May 2024 US
Image: Andrew Davis
A broad topic to cover, but one the esteemed panel at this year’s Securities Finance Symposium in Boston were eager to address. From data transparency to artificial intelligence (AI), a number of hot topics were looked at.
A running theme throughout the discussion was data transparency. Though this comes in many different forms, perhaps the general consensus can be best summarised by the thoughts of Anthony Toscano, executive vice president and head of Global Securities Lending Solutions in North America, MUFG Investor Services: “More data and transparency is good, but it would be helpful to know what it will be used for.”
Going a step further, Elaine Hannigan, director of equity finance at Scotiabank, expresses hope that more transparency may even help prevent, or at least aid in dealing with, the next financial crisis — the 2008 crash remains at the forefront of the industry’s mind when talking about transparency and regulation.
Technology and AI also took prime-position during the discussion, though cybersecurity and operational resilience were a key area the panel was keen to address. Despite concerns that improved security, and the costs associated with it, were in essence another ‘tax’, the importance of robust protection was unanimously agreed on.
As James Curtis, vice president of US Agency Lending Trading at Fidelity Investments, puts it, “Cybersecurity is at the front of everyone’s mind, in businesses large and small”.
Discussing AI, its benefits in the summary and distilling of vast amounts of data were highlighted as of key potential importance to the industry. Its predictive ability, too, was a notable insertion often not mentioned. From macroeconomic trends to security price predictions, AI, it seems, may have a lot to live up to.
Closing up with final thoughts, it was almost inevitable that T+1 would be part of the conversation. Mirroring a sentiment gaining more traction in many circles, Divyesh Bhakta, CEO at FinOptSys poetically described his view: “T+1 is the appetiser — T+0 is coming.”
Always good to end on a positive note, and with risk, new technology, and regulations often seen as casting a shadow, Robert Sackett, head of prime financing at Clear Street, reiterates that he is bullish for the industry. “It’s a people business”, he says, and you will always need those human relationships even in the age of AI.
A running theme throughout the discussion was data transparency. Though this comes in many different forms, perhaps the general consensus can be best summarised by the thoughts of Anthony Toscano, executive vice president and head of Global Securities Lending Solutions in North America, MUFG Investor Services: “More data and transparency is good, but it would be helpful to know what it will be used for.”
Going a step further, Elaine Hannigan, director of equity finance at Scotiabank, expresses hope that more transparency may even help prevent, or at least aid in dealing with, the next financial crisis — the 2008 crash remains at the forefront of the industry’s mind when talking about transparency and regulation.
Technology and AI also took prime-position during the discussion, though cybersecurity and operational resilience were a key area the panel was keen to address. Despite concerns that improved security, and the costs associated with it, were in essence another ‘tax’, the importance of robust protection was unanimously agreed on.
As James Curtis, vice president of US Agency Lending Trading at Fidelity Investments, puts it, “Cybersecurity is at the front of everyone’s mind, in businesses large and small”.
Discussing AI, its benefits in the summary and distilling of vast amounts of data were highlighted as of key potential importance to the industry. Its predictive ability, too, was a notable insertion often not mentioned. From macroeconomic trends to security price predictions, AI, it seems, may have a lot to live up to.
Closing up with final thoughts, it was almost inevitable that T+1 would be part of the conversation. Mirroring a sentiment gaining more traction in many circles, Divyesh Bhakta, CEO at FinOptSys poetically described his view: “T+1 is the appetiser — T+0 is coming.”
Always good to end on a positive note, and with risk, new technology, and regulations often seen as casting a shadow, Robert Sackett, head of prime financing at Clear Street, reiterates that he is bullish for the industry. “It’s a people business”, he says, and you will always need those human relationships even in the age of AI.
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