Northern Trust Corp.'s capital markets division has developed a machine-learning based pricing engine for securities-lending clients, the bank said Monday in a news release.
The engine projects the demand for equities in the securities-lending market by using an algorithm that automatically broadcasts lending rates for 34 global markets to Northern Trust's borrowers.
The news release said the new engine enhances "revenue opportunities for lending clients." The engine is built on a hybrid-cloud platform and its algorithm "leverages numerous strategic market data points from multiple asset classes" to project future demand for equities in the securities-lending market.
As of June 30, Northern Trust had about $1.2 trillion in lendable assets for over 450 worldwide clients, the news release aid.
"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, in the news release. "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."