ING cuts bond trading time with AI-powered Katana
The name’s bond. Tamed bond. Sharp-witted ING has rolled out Katana, an artificial intelligence (AI) tool designed to improve decision-making in bond trading.
Katana uses predictive analytics to help traders decide what price to quote when a client wants to buy or sell a bond. In addition, it provides traders with a visualisation of relevant historic and real-time data.
Santiago Braje, global head of credit trading at ING Wholesale Bank, says Katana can “enhance the traders’ decision-making abilities, allowing them to deploy their natural intuition and expertise in the most effective way”.
According to ING, the first results of testing Katana with the emerging markets (EM) desk in London show faster pricing decisions for 90% of trades; reduction in trading cost by 25%; and traders are able to offer clients the best price four times more frequently.
Like many others, ING also cites the impending MiFID II, which comes into effect in January 2018. It reckons Katana helps traders manage higher trading volumes and better prepares them for further acceleration of markets as trading flows are expected to move from voice to electronic platforms.
ING explains that Katana learns from the history of hundreds of thousands of trades and translates this into a prediction or suggested decision for the trader.
To calm the fears of humanity, the bank adds that “it is uniquely designed to complement a trader’s cognitive ability, rather than replace him or her”.
Katana has been developed in an “iterative process” by ING’s Financial Markets Global Credit Trading team in London and ING’s Wholesale Banking Advanced Analytics team who will continue collaborating to constantly update the tool with new unspecified functionalities.