Nearly 60 per cent of Australian-based institutional investors and asset managers expect the institutional financial services sector to “meaningfully adopt” artificial intelligence (AI) technologies within just two years, according to Northern Trust.
Institutional investors and managers based in Singapore and Hong Kong also predicted widespread embracing of AI, but over two to five years instead.
Half the survey respondents in Australia flagged high level stakeholder engagement and counter-party cooperation as crucial to the financial services industry’s adoption of blockchain technologies.
In Asia, key concerns focussed on a need for greater clarity in understanding the regulatory landscape should the industry implement blockchain.
Half of respondents in Hong Kong and nearly 40 per cent in Singapore pointed to this need.
“In Asia-Pacific we have seen regulatory changes either built within existing policy frameworks, or shifted, as the market landscape transforms,” Northern Trust head of Global Fund Services for Asia, Caroline Higgins, said.
She said that this meant it was important that financial institutions, technology enablers, regulators and governments collaborated to support the adoption of emerging technology.
Northern Trust head of Market Advocacy & Innovation Research, Asia Pacific, Danielle Henderson, said the AI would lead to greater operational efficiency, more insightful information and enhanced client experience.
“Market developments may include machine learning capabilities for faster and deeper data consumption, advanced analytics for better decision making and natural language generation for automated report commentary,” she said.
The results came from a survey of investment manager and institutional investor clients attending Northern Trust events in the group’s Sydney, Singapore and Hong Kong offices during 2018’s first quarter.
While not having a strategic asset allocation might be ‘uncomfortable’ for some investors, the Future Fund believes its unique investment approach helps the fund capture long-term value ahead of the curve.
The sovereign wealth fund grew $11.5 billion in the March quarter, according to its latest portfolio update, having previously voiced caution about inflation’s downward trajectory.
The property group, owned by industry super fund Aware Super, has announced two new projects with a total construction value of $320 million that will add more than 700 homes to Melbourne’s rental market.
While institutional investors, including super funds, unanimously acknowledge the energy transition as a significant challenge, their perspectives on the extent of their involvement in addressing the substantial capital requirements vary widely.
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