Mizuho partners with Nomura to bring AI to derivatives contracts
Japan's Mizuho Bank has developed an artificial intelligence (AI) proof-of-concept platform with Nomura Research Institute that has "significantly decreased" the amount of time needed to register International Swaps and Derivatives Association (ISDA) contract information. The project set out to examine the realistic applications of AI to replace the laborious manual processes involved in some derivatives contract procedures. The AI system is also expected to maintain a high level of understanding of ISDA contract operations and the two companies are now working on a fully-fledged system service for all derivatives contract operations.
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.