The Future of Investment Banking Into Open Banking Age

Investment Banking is the Most Important Industry for our Economy.

The Correct Allocation of Capital Flows allow not only a win for the Investors, but also for Corporations and Society thanks to Improvements in Production Processes allowed by new Investments.

To Understand the Evolution of this Fundamental Industry for the Next Future it is necessary to Analyse Deeply the Evolution of the Variables that relevantly determine the Behaviours and the Dynamics of the Organisations and the Individuals that act in this Industry.

As a First Class Student into “Digital Technologies and Organisational and Social Changes” Exam, I am Convinced that Technologies` Evolution will have the Most Meaningful Impact.

In fact, Finance is a Function of Knowledge (in terms of Future Prediction and Quality of Present Analysis), and consequently depends on the Data (Information) and Models Available.

Assuming that Models to Analyse Data will remain constant – As a Machine Learning and Applied Statistics Student at Imperial College London I think it is an Unlikely Assumption because of the Strong Evolution into AI Field -, we can Observe how the Quantity of the Sources of Data and the Intervals of Frequency will Exponentially Improve respect to the past 30 Years.

Just to give an Example we can Observe the Expected Increase of IOT Devices Worldwide.

More Devices Means More Potential Data Available

Also the Digital Universe Study analysed that right now only the 0.5% of the Data is Utilised to do an Analysis: this means that we have a Lot of Potential Open Door to Create New Economic Value and Exponentially Better Financial Returns.

This take us to the second most important variable: The Culture of an Organisation.
In fact, it is Important to have within the Organisation the Best Individuals in terms of Applied Technologies to Correctly Bring the New Benefits.

The Risk of Not Correctly Understand the New Market Systemic Trend as AI and IOT could be fatal to the Long-Term Sustainability of a Corporation.

This is True Especially for an Investment Bank who have the Ethical and Moral Responsibility to Help Companies to Survive and Succeed on the Market.

Obviously to expect that everyone will be able to handle deeply and with a sufficient technical knowledge all the New Technologies it is a Big Flaw in our Reasoning.

This is where Open Banking come Into Play.

In fact, the API Structure and Logic of the Open Banking (Here you can find the Investopedia Definition) can Help both Back-End and Front-End Human Resources to have a Smarter understanding of the Current Market Conditions.

The API Logic, in fact, make it Easier to Interact with a Large Quantity of Data and a with Complex Models and Functions: you can use it as a “Black-Box” Instrument where you can Send the Input that have to be elaborated and receive the Final Output.

To use them you need only some Basics Data Science Skills, as for Example a Bit of Understanding of the Python Programming Language.

This could help to Increase the Productivity of the Investment Banker, having a more clever overview of the Instruments and of the Assets and making her/him able to Focus More on the Creation of Financial Wealth for the Client.

Success in using in a Smarter way the New Technologies could mean a shift as the “Calculator-to-Excel” one, improving Productivity and Making More People Rich and Creating a Better Society for Everyone.

To Ensure this is Necessary to Change the Organisational Culture and Analyse How to Improve the Overall Client`s Experience in an Innovative way.

I Hope That You Found My Article Useful, If You Need More Information Please Comment Here or Contact Me via the Contact Section.

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