Investing in technology and data infrastructure is a top priority for asset managers as they position themselves to drive business growth in the recovery from the COVID-19 pandemic, according to a new report.
Most, 56%, say their investment will focus on these areas over the next 12 months, while 47% say they will aim to ensure ESG compliance across their product line. These are the conclusions of a new report from Funds Europe – The future of investing – for Temenos, publisher of banking software.
The survey of global investment professionals in the asset management industry also reveals that COVID-19 has prompted companies to review their IT strategies and move to public / hybrid cloud. In total, 62% of respondents say that cloud native solutions will play a key role in their IT strategy, followed by the importance of SaaS (Software-as-a-Service) solutions (48%) and the use of ‘Open APIs. technology (46 percent).
To improve operational efficiency levels, companies seek a seamless interconnection between functions throughout the investment value chain. In the survey, 83% of asset managers say they will expand their strategic alliances with technology and asset management partners, enabling the connection of middle and back office services directly to their front office tools and to their investment book (IBOR).
AI and machine learning are expected to play a growing role in delivering information, both predictive and ex post analytical, throughout the investment lifecycle. The main applications of AI are portfolio analysis and performance measurement (60%), data sourcing, cleansing and enrichment (57%) and improving the operational efficiency of processes middle and back-office (56%). However, increasing human expertise in AI models will be a priority in applying AI models, according to 60% of respondents. This capability is essential for delivering business intelligence in a way that is explainable to product teams, customers, and financial supervisors.
“As we chart the course for recovery, asset servicing companies and fund managers are increasingly looking to leverage the tools, analytics and scalability of the cloud,” Director of Temenos Multifonds Business Soultions Barry lee noted. “Temenos’ SaaS-based Explainable AI (XAI), for example, enables our fund administrator clients to use AI to reduce manual intervention, detect potential failures in the workflow, and accelerate the management of funds. exceptions related to price movements. This ensures the sustainability of their operations against black swan events and increases overall efficiency and productivity. “