The banking industry has evolved significantly in the past ten years, especially as more and more fintech companies enter the new spaces and challenge new players on their own playing fields.
But no matter the fanciful buzzwords like Blockchain and AI – the real market and technology driver that persists today is real-time data. As institutional investors find new ways to capture this instantaneous insight to compete while managing operational challenges and cost efficiencies, legacy technology will continue to fade across the front- to back-office.
The Fintech Times sat down with Darren Crowther, the General Manager of the Securities Finance and Collateral Management Business at Broadridge to discuss how the company are adapting and using real-time data and AI. Crowther is also part of the Executive Leadership Team for both Broadridge International and the Broadridge Capital Markets Franchise.
Crowther joined Broadridge in 2016 as part of Broadridge’s acquisition of 4sight Financial Software. Over the last 21 years Crowther has worked with some of the world’s largest banks, brokers, and asset managers helping to implement and promote the usages of Financial Technologies in the Securities Finance and Asset Management space.
What do you think makes Broadridge stand out and unique?
In the Fintech area, Broadridge provides truly front-to-back solutions for financial markets on a global basis. It’s this functional and geographic reach that makes us such a leader in the areas in which we operate. It’s that leadership that helps us generate $4.5billion of annual revenues and create ever-growing, brand recognition across the globe.
Much of this success comes from how we work with our clients. We genuinely partner with them in business transformation, helping them adopt solutions that enrich their engagement with their clients, understand and manage risk, optimise efficiency, and grow revenues.
The other thing that makes us stand out is our associates. We strive to be the best, and our value profit chain allows for the associates to benefit from our successes as they happen. Being the best starts with attracting highly competent and high potential people to work for us. We keep those people and get recognition as a highly rated ‘Great Place to Work’ because our associates appreciate how we provide them with opportunities to grow and cherish the principles of fairness and diversity.
What are some of Broadridge’s unique features?
Our growth comes from both internal organic growth and from acquisitions. I am part of an organisation that appreciates diverse talents from different countries, with different skills sets, that come from acquisitions. Though we have a strong corporate culture, it is the culture that is secure enough to welcome the internal disruption from acquisitions because we are so good at channelling all the new perspectives we gain.
We are certainly not scared of people asking ‘why’ do we do things in a particular way and are constantly looking for ways to improve our clients and our associate’s experience. Our openness to change and challenge means we are looking both inwards and outwards for ideas and product suggestions. We also work and collaborate with external organisations, innovation hubs, and universities to provide the best services and solutions to our clients.
How have clients responded to these unique features?
Our clients see us as a trusted provider with strong levels of service, technology, and resiliency. Given the importance of our place within Financial markets trust, service, and resiliency of solutions are key pillars to our offerings.
Equally, we are seen as thought leaders in the market and an organisation that provides new innovative solutions to the markets. An example is the technology changes introduced to hold Virtual Shareholder meetings and allow digital voting. We saw a large uptick in requests for these services and several product enhancements were fast-tracked due to the pandemic and now play a part in setting the standards for similar solutions across the globe.
What do Broadridge’s road map and growth plan look like? How do you plan to continue to differentiate the company from the rest of the competition?
Our historic strengths came supporting mid and back-office areas via award-winning post-trade and reconciliation platforms. Over the last few years through a combination of organic and inorganic product growth, we have more far more strongly into the front office space. Our recent acquisition of Itiviti, with its front office and electronic trading capabilities for $2.5billion really positions us to become the leader in front-to-back solutions.
The breadth of our capabilities and the depth of our experience has put us in a position where we can really help our clients fully embrace the benefits of digitisation and using data to drive better decision-making. Our combined understanding of the process, technology, and data puts us in a great position to expand the use of artificial intelligence in financial markets.
The pandemic has been a mixed blessing for companies in the financial sector. Some have been able to digitise and prosper whereas some have failed miserably. How has the pandemic affected Broadridge?
As a service provider responsible for running financial platforms, providing services to our clients, and building software solutions my initial view was that things would be challenging.
However, due to the investment that Broadridge had made in the prior decade around resiliency, scalability, and digitised workspaces we transitioned across very quickly with no impact on the services we provide to our clients.
The focus of Broadridge during the period has been two-fold. Ensuring our associates and their families are safe and well and have the digital capability to meet the new demands placed on them via home working. I know personally that the initial few months were hard, three kids, wife, dog, working at home, remote schooling. None of it was normal but thankfully Broadridge supported their associates in this period by providing the flexibility, support, and empathy for what was for some a very hard period.
After the initial period, our focus as an organisation and management team was around ‘The Connected Workplace’. This is an ongoing process to provide the associates with the best digital tools to do their jobs from home or the office. Focus has remained on physical and mental health throughout and encouraging exercise, time away from the screens, and talking with teams to ensure they remain connected and attached to our core Mission and Vision.
What have been the greatest innovations in digital banking that you have seen in the last decade and where does Broadridge fit in here?
Undoubtedly the introduction of Cloud-based infrastructure from vendors like IBM, Amazon, and Microsoft has been transformative. As well as providing the ability for organisations to increase their resiliency levels while decreasing cost the biggest benefit has been to innovation.
Ideas can be transformed into production-ready solutions much faster. This has led to small startups, collaboration labs, and R&D areas within larger Fintech pushing the boundaries and number of products, modules, and enhancements that can be made to products, and in the end, Improving user experience and interaction with digital tools.
Without the cloud, this would not have been possible in the same timeframe and at the same price point.
Additionally, the general acceptance and introduction of Artificial Intelligence (AI) based components into the FinTech world has begun to see benefits to organisations. These benefits include boosting revenue, lowering costs of business, and uncovering new revenue streams using data analysis and AI techniques. A study published by McKinsey assessed there are over $1trillion of annual additional revenue opportunities which could be unlocked by banks by using AI.
What problems have these innovations solved?
There are hundreds of uses of AI within Banking and Digital Technologies in general which have rolled out of the last years.
My favorite recent usage of AI relates to Food and company called Just Eat. Just Eat Used AI to build custom Digital content for each user. Like many people, the usage of home delivery services during the pandemic was the highlight of my week. The digital experience in ordering across all of these apps improved dramatically in a short space of time.
A great example of using AI at Broadridge is LTX which uses AI to allow dealers and institutional investors to trade corporate bonds. Dealers can now trade more efficiently and unlock liquidity and increase additional revenues. AI is also used in other platforms within Broadridge to add similar process efficiencies, increase revenues, and through product development unlock new revenues lines for the Financial markets.
What still needs to be done in the field?
At Broadridge, we are looking at the next stage of our data and digitisation journey. The first step was Mutualisation on the Cloud. Moving clients at scale and their operations, systems, and underlying data to the cloud allowed us to gather information and data on a scale that would not have been possible 20 years ago. We have now started a two-pronged attack on the next steps.
AI is prong one and as I mentioned we have started to use AI across the product set and work with clients to see the benefits already on a large scale.
The 2nd prong is data analysis, machine learning, and data mining. This has allowed us to see patterns in trends in data flows, exception processing, and volume peaks. As we get to grips with this Big Data set, we are building products and solutions which fall back on the same themes, increase and unlock revenues and reduce costs.