The Connector.

The Connector Podcast - AI-Powered Compliance and Wealth Management: Comarch's Jean-Baptiste on Navigating Benelux and French Markets

Koen Vanderhoydonk (The Connector) Season 1 Episode 57

Unlock the transformative power of artificial intelligence in wealth management with insights from Jean-Baptiste Beaux from Comarch! This episode promises to reveal how AI is revolutionizing the sector by enhancing decision-making, optimizing portfolios, and significantly automating tasks to boost efficiency and accuracy. Listen as Jean-Baptiste underscores AI's critical role in supporting advisors rather than replacing them, ensuring that the human touch remains paramount. Discover how recent regulations, like MiFID II and SFDR, are not just compliance hurdles but opportunities for innovation that can convert regulatory tasks into valuable data, ultimately leading to personalized investment advice. 

Stay tuned for our engaging chat with Jean-Baptiste Beaux from Comarch as he shares the latest developments shaking up the fintech world. This episode is packed with valuable insights you won't want to miss!

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Koen Vanderhoydonk
koen.vanderhoydonk@jointheconnector.com

#FinTech #RegTech #Scaleup #WealthTech

Speaker 1:

Welcome to the Connector podcast, an ongoing conversation connecting fintechs, banks and regulators worldwide. Join CEO and founder Cohen van der Hooydonk as you learn more about the latest available trends and solutions in the markets.

Speaker 2:

Welcome to another podcast in collaboration between Fintech Belgium and ourselves, the Connector, and today I've got Jean-Baptiste with me from Comark. Jean-baptiste, can you please introduce yourself? And the company Comark.

Speaker 3:

All right, Good morning Kun. Thanks a lot for inviting me on your podcast.

Speaker 2:

You're welcome.

Speaker 3:

It's a real pleasure to be here today. So yeah, as you mentioned, I'm Jean-Baptiste Deibault. I'm working for Comarch for almost three years now. Comarch has been officially founded in 1993 by Professor Philippiak, back when he was teaching IT engineering at the University of Krakow in Poland. So nowadays we grew into a global software company along with 7,000 colleagues worldwide across Europe, the Americas, the Middle East and Asia.

Speaker 2:

It's quite an impressive growth, isn't it?

Speaker 3:

Indeed, that's quite impressive. We're no longer a fintech, I would say at the group level. But if you change the point of view to a more granular approach, I would say we kind of of behave like fintech. We are very agile, flexible, innovative, disruptive and, yeah, we are going to talk about um uh stuff. We are, we are doing uh today, but my role more specifically within comark uh consists of managing commercial activities for the french and benedict markets. I'm based in brussels and uh, yeah, the uh daily activities uh consist of expanding the development of our softwares for financial institutions. So I'm personally responsible for our platform called comark wealth management, which is designed to support advisors, relationship managers, in delivering personalized investment advice to their customers using the latest technologies like cloud computing, like artificial intelligence, for example.

Speaker 2:

And today we agreed that we would indeed talk about wealth management, but more particularly on AI, and I was wondering what do you see as the most innovative things that are happening within the space of wealth management combined with AI?

Speaker 3:

And there's a very important point. To start with, I would say that the industry of wealth management, investment services, portfolio management is undergoing a huge technological transformation at the moment and, of course, the shiny innovation everyone is talking about today is AI, because AI is a real game changer in this wealth management industry in how advisors interact with their customers, how they can optimize investment strategies and deliver a hyper-personalized customer experience.

Speaker 3:

So not only does it help improve advisors' productivity, but it also significantly helps to engage customers more, and more and more effectively. I would say, the AI here today is not there to replace humans, because that's also a topic nowadays. That's also a very important point and that's the idea while integrating ai within our softwares, within comark. The machine is here to support the advisors and not to replace them, and because, at the end of the day, especially in this specific sector, human relationships still remain important it's.

Speaker 2:

It's what we often call as the augmentation of the relationship.

Speaker 1:

It is.

Speaker 2:

No, interesting. But where does AI then come in? Is it to increase accuracy? Is it to create more efficient portfolios? Is it to find insights? Where exactly in the chain does it come in?

Speaker 3:

Indeed. So we found a couple of important use cases while using AI for portfolio management, for example. Let's break it down into some key examples here. First of all, ai enhances the decision-making by processing vast amounts of data at incredible speeds, providing deeper insights, better forecasts and far beyond what a human being is capable of.

Speaker 3:

When it when it comes to portfolio construction, portfolio optimizations. Ai-driven models are used to balance risk return more effectively and non-stop adjusting as new data comes in. But also AI is improving automated portfolio rebalancing. It helps to reduce human errors. It helps to get rid of, I would say, emotion-driven decisions. Interesting this automation thanks to AI also helps to save time, to reduce operational costs, making the portfolio management process more efficient and, last but not least, as you mentioned, for risk management. Ai offers advanced tools for this kind of specific work. It helps identify, it helps to assess, mitigate risks more effectively than using traditional methods or tools.

Speaker 2:

We also said that we would also bring in regulation into the mix, and it's an interesting mix when you bring AI and regulations. What's your view on that and how does that translate to financial institutions and their investment proposals?

Speaker 3:

And that's also, I think, a very important topic Because recent regulations like MIFI 2, the SFDR. They present significant opportunities for innovation and they bring additional value for financial institutions in this industry Because these rules, like I mentioned, they require to perform KVC AML checks, to conduct suitability questionnaires, to examine customer ESG preferences and, yes, while these tasks may seem like a burden at first, they really help to collect valuable customer data, which is crucial for feeding AI and machine learning models in order to, at the end of the day, deliver personalized and suitable investment advice.

Speaker 2:

No, that's an interesting take. So what you're saying is that you use regulation as a sort of competitive advantage in terms of being like on par with AI and even be, maybe, a front of the pact. Is that correct?

Speaker 3:

Indeed, and that's typically the strategy that financial institutions have to adapt. They have to stay ahead of innovation. They should lead regulations, not follow it, so that's typically the goal here.

Speaker 2:

And is that something that Comark can help with?

Speaker 3:

Indeed, that's also the core of our solutions to embed KYC AML suitability checks in order to fit our core engine and in order to deliver this personalized advice. So it's it's I would say it's the starting line of every relationship in this sector to get this data and to fit it into ai machine learning models.

Speaker 2:

Well, it's interesting that you bring in the future here, because I I do think that a lot of things are happening, but what else do you see on the level of regulations, ai and anything else in our industry?

Speaker 3:

yeah, of course we all have in mind the prime example of the ai act at the european level, which basically aims to balance innovation coming from ai with risk management, ensuring that AI and data-driven solutions are transparent, they are fair, they are secure, while supporting also tech advancements and, at the end of the day, protecting investor interest.

Speaker 3:

But also we can see some guidelines taking shape. We have the ESMA, so the European Securities and Market Authority. They recently issued a statement which emphasized the benefits of leveraging AI in the investment industry, but they also highlighted the need for proper staff training on how AI is used within the specific organizations, the importance of understanding the associated risks in order to ensure a safe and effective usage. I would expect regulations to become more precise, more protective for the customers, including data handling practices, increased AI governance, maybe with internationalizations of standards, with a continuous focus on ESG and sustainable investing. And also we see cybersecurity and operational resilience, which is highlighted by Doha recently. So I think it definitely won't be an easy task given the rapid pace of AI advancement, but that could be a complete new topic.

Speaker 2:

What has changed in our industry? Right, it has been like that for ages.

Speaker 3:

Indeed.

Speaker 2:

Is there any examples that you can share? That is coming from your end, from the Comarch end.

Speaker 3:

Yes indeed. Regarding the use of AI within Comarch, the development team of the platform Comarch Wealth Management, they recently implemented a new feature I would say a very shiny feature for the years to come, thanks to augmented artificial intelligence. This new feature is called the concept of personalized videos, which are basically short movies embedded in the customer's mobile app, leveraging their personal information like their name, their birthday, their last investment activity, etc. And the customers. They can see their real own advisor talking to them via their banking app, suggesting some investment ideas. And these are not pre-recorded videos, but video created thanks to AI, and it's really impressive, Wow. I think the aim behind this is to attract and drive customers interest and make them engage, make them invest more and more, but I'm sure you'll see this new feature in your banking app within a couple of months oh, nice, nice.

Speaker 2:

And you know, these are the times that I sometimes regret we're running a podcast and not a vlog, because then I could say to you hey, please share your screen and show us. Hey, we're already at the end of this podcast, but what a blast at the end. So I guess everyone would like to know more about this new example. How can they contact you? And how can they contact Comark?

Speaker 3:

The easiest way to contact me is via my LinkedIn profile, by searching my name, jean-baptiste beaux, but you can also use my email address, which is jean-baptistebeaux at comarkcom. So, of course, I'll be very eager to hear some feedback, some suggestions, continue the discussion on this topic and maybe show you as well this last shiny feature that I just talked about oh great, thank you very much, joe baptiste uh thank you all, thank you also yeah, so thank you also to the audience.

Speaker 2:

Uh and uh, we'll stay tuned for more news out of the fintech area.

Speaker 1:

Thank you so much thanks for listening to another episode of the connector. To connect and keep up to date with all the latest, head over to wwwjointhekonnectorcom or hit subscribe via your podcast streaming platform.