Mizuho Bank has completed a project with Nomura Research Institute using artificial intelligence to eliminate certain derivative contract procedures.
Nomura was approached by Mizuho to develop the project and examine the realistic applications of AI, as the standard derivative contract procedure has traditionally included various manual and archiving processes.
The proof-of-concept found optional character recognition can digitise contracts from ISDA and the system can define, extract and archive the data into a format that is more easily accessible.
Both firms said as a result, the time it takes analysts to register ISDA contract information into the system was ‘significantly decreased’.
Masahiro Ueki, SVP of legal and compliance and global markets coordination at Mizuho, also expects the system to maintain a high-level of understanding of ISDA contract operations.
Hiroyuki Nakayama, general manager of financial business planning at Nomura Research Institute, added: “We continue to learn new and exciting applications for the technology that we are seeking to implement further through strong partnerships.”
Mizuho Bank intends to continue working with Nomura to develop a fully-fledged system service for all derivative contract operations.