Unique Partnership between Large Bank and Start-up Written by on April 26th, 2018

BNP Paribas Securities and Services (BNPP Securities Services) and Fortia Financial Solution, working together to build innovation and disruptive depositary compliance platform

Fund management companies and depositaries run post-trade control plans on the funds domiciled in Europe on a regular basis. This is becoming increasingly complex in a context where new regulations and sanctions regimes keep increasing the required level of oversight.

Europe’s largest depositary, BNPP Securities Services believes that innovation and disruptive thinking can open new perspectives in the way the industry addresses challenges linked to the trustee and depositary control areas as well as the post-trade investment compliance monitoring

We decided to partner with a Regtech called Fortia Financial Solutions, which has spent four years on research and development on a solution called Innova. BNPP Securities Services has acquired a minority stake in Fortia, paving the way for a long-term partnership that will allow us to continue co-creating and designing the future of funds compliance services. For the past year, we have been co-developing a platform based on Innova using both technical and business expertise to re-invent the way we work in the very conservative space of Depositary & Fiduciary Services. Let’s meet some people leading this transformational program before the ICT event.

Mustapha OUAFIK, INES Program COO:
“I was convinced that new technologies will help us industrialise tasks that are traditionally performed ‘manually’. Rather than buying existing software or developing in-house we decided to open a new way of working by co-developing with a start-up.
As a manager, this newly created working environment is very inspiring and rewarding, as we are setting new standards and working methodologies. My conclusion is that innovation and disruptive thinking can open new perspectives in the way the industry addresses this challenge. Our digital transformation demonstrates that new technologies smartly applied could make a real difference for us and for our clients”

Reda BOUAKEL, Fortia CEO:
“When BNPP Securities Services invested in Fortia, the bank was not yet a customer but conduct a deep dive review of our system for four months to validate the business partnership. Besides investing in Fortia, BNPP Securities Services also allowed us to improve our systems and market the solution to BNPP Securities Services own clients, fund management companies, etc. We have already signed three of them, but the prospect list remains very long.”
Created in 2012, Fortia develops deep-learning algorithms for automating the business processes of banks and insurance. R&D is in Fortia’s DNA. The Minimum Valuable Product assessment led to this co-development project, aiming to deploy the target solution across BNP Paribas locations.
“Our intelligence is to provide a pre-analysis in less than seconds using advanced algorithms that would take several man days today. Banks cannot stay away from these productivity gains”.

Fernand MARTINS, Depositary Operation Manager, France, and then Depobank expert on INES Project:
“Artificial Intelligence technology provided by Fortia will allow us to industrialize our processes in a disruptive way. Fund reader is my favourite as it will allow us to verify layout conformity and automatically setup our fund repository.”
Parsing remains the most impressive and concrete demonstration of AI. Reading prospectuses (From 30 to 250 pages) in just few seconds, the tool will recognize investment guidelines, allowing the compliance officer to switch his time from reading documents to analysing Innova’s output.

Miroslav PETROV, Fortia Product director:
“The solution is made up of four technological bricks. First, a module called Data Management which collects and manages unstructured customer data. Then the data is processed by a library of algorithms, four of which have been patented, and by an automatic computation engine, which creates calculation rules automatically. Everything is coordinated by Business Process Monitoring, a control tower that organizes the actions of the other modules. Fortia also builds tools to automate operational processes, decision assistance, and to create data’s referential model…”
“Fortia technologies can and will be applied in many other fields in following years. BNPP Securities Services is the pioneers and our spokesperson.”

Jean DEVAMBEZ, Fortia sponsors:
“Working with a start-up brings major added value to the Bank, from agility management, a new approach to the creativity, and most important, a concrete and proved technological expertise. Nonetheless, this requires in return a particular follow-up and support to accompany the growth of this start-up. We are willing and finding a way to balance our input and output.
This is exactly the role of the incubator we have created within BNPP Securities Services, i.e. supporting our business lines in their move to reinvent themselves. In other words, our cooperation with Fortia allows us not only to re-invent our existing trades, but also to consider new offers and reposition in the banking industry.”

Nicola ELSHAW, Product manager:
“Innova solution will definitely improve our daily lives. From our clients’ perspective, the product will provide a more meaningful approach including complex rules.
The client onboarding process will evolve thanks to fund reader algorithms. Switching from coding process to set up process, Innova will reduce cost as well as execution risks. For example, the CIC process will reduce from 8 hours per funds to just 1 hour. And for the Depositary process, the shift will be from 3 hours to 30 minutes.
We are providing an evolving and updating product to our client, allowing us to remain competitive and in a leading position on the market.”

Our story never ends, let’s exchange our ideas and have fun during the upcoming ICT conference.