Northern Trust Develops Machine Learning Based Forecasting Engine to Drive Securities Lending Revenue
Northern Trust (NTRS) announced today it has developed an innovative pricing engine that utilizes machine learning and advanced statistical techniques to drive revenue growth for clients by more effectively forecasting the rate to loan securities in the securities lending market.
CHICAGO and LONDON - Northern Trust (NTRS) announced today it has developed an innovative pricing engine that utilizes machine learning and advanced statistical techniques to drive revenue growth for clients by more effectively forecasting the rate to loan securities in the securities lending market.
Built on a hybrid-cloud platform that allows for highly efficient processing of data, the algorithm leverages numerous strategic market data points from multiple asset classes and regions to project the demand for equities in the securities lending market. Northern Trust global securities lending traders are able to leverage these projections, together with their own market intelligence, to automatically broadcast lending rates for 34 global markets to Northern Trust’s extensive network of borrowers, thereby enhancing revenue opportunities for lending clients.
“Northern Trust continues to invest in emerging technologies to bring enhanced value to our clients,” said Pete Cherecwich, president of Corporate and Institutional Services at Northern Trust. “The use of machine learning in our global securities lending business enables greater pricing efficiency that helps clients improve revenue across portfolios. This enhances Northern Trust’s broad suite of securities financing capabilities, providing borrowers with highly automated, low transaction cost trade execution solutions in this cost-conscious market.”
From trading desks in Chicago, London, Hong Kong, Sydney and Toronto, Northern Trust’s securities lending team has been generating incremental revenue for clients using innovative solutions for over three decades. As of June 30, 2019, there was approximately US$1.2 trillion in lendable assets for more than 450 clients worldwide.
“With this latest advancement, we have created an infrastructure and analytical framework that can intelligently adapt to changing market conditions” said Dane Fannin, head of global securities lending at Northern Trust. “Our technology assesses market demand across thousands of securities and allows our traders to extract better returns for our clients. The potential benefits from machine learning techniques extend beyond this initial application, and we will continue exploring and developing solutions that drive value for our clients.”
About Northern Trust Capital Markets
Northern Trust Capital Markets delivers innovative technology, transparent trading, quality execution, smart liquidity solutions and regulatory compliance services across institutional brokerage, transition management, securities lending and foreign exchange. Capital Markets is a division of Corporate & Institutional Services, which provides asset servicing, fund administration and middle office solutions to institutional asset managers and asset owners around the globe.
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has a global presence with offices in 20 U.S. states and Washington, D.C., and across 23 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of June 30, 2019, Northern Trust had assets under custody/administration of US$11.3 trillion, and assets under management of US$1.2 trillion. For more than 125 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Please visit our website or follow us on Twitter.
Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Please read our global and regulatory information.