Nasdaq has expanded its risk management platform for banks and broker-dealers late last month as recent volatility in the market has highlighted the need for real-time data.
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Roland Chai, executive vice president of marketplace technology at Nasdaq, said he's seen a hike in demand from clients, especially banks, for fast, more frequency analysis of exposure across asset classes. In the last year, the number of clients using the risk platform increased by more than 50%, including multiple tier 1 and tier 2 banks as well as bank prime brokers.
"Risk managers need better tools because the information cycle is very overwhelming," Chai said. "Asset prices move all the time. Clients of banks want to know that there's the right investment in technology to be able to take care of their positions, and also their assets. I don't see that changing because of regulation or market structure. I see that more as a macro market trend."
Chai added that rising interest rates were already ramping up banks' needs for those products, but the recent banking crisis added fuel to the fire.
Nasdaq's risk platform provides cloud-native, SaaS deployed analysis for firms like investment banks, prime brokers and clearing brokers. The platform is hosted in Amazon Web Services and delivered via a dashboard with a real-time view of data and analysis, like interest risk and liquidity risk, across client portfolios.
Nasdaq began working to add fixed income securities to the risk platform last year. Chai said the change was especially important to banks, which often have multi-asset exposure. Part of the recent update also includes a live stream of derivatives pricing.
"More and more, it's about how we marry sophisticated market data into the tool and provide that to risk managers so they get it all at once in a single dashboard," Chai said.
Nasdaq isn't the only company that offers risk management technology, but Chai said the company leverages its experience as a legacy exchange, generating data and processing real-time transactions, in developing the product.
That exchange experience is relevant as players in the U.S. equities market, like investment banks and fintechs that provide them services, scale technology to move faster. Steve Gatti, a partner at Clifford Chance and head of its U.S. fintech practice, said in a March interview that technology has driven competition and improvement in the equities market.
Across financial institutions,
