Securitization technologies often improve underwriting but also heighten risk
February 27, 2020 (7.37mins)
Jody Shenn, Pedro Sancholuz Ruda
Jody Shenn and Pedro Sancholuz Ruda from the Structured Finance team discuss how technologies like alternative data, machine learning, blockchains and document digitization can help to improve the accuracy and efficiency of asset origination or underwriting, as well as transaction services. That said, nearly all are untested through a credit cycle and come with potential legal and compliance risks.
Fast-growing technologies often improve underwriting and create efficiencies, but also heighten risk
Securitization parties’ ongoing adoption of new and evolving technologies such as advances in alternative data use, machine learning, blockchain and document digitization will improve securitization credit quality over time, but also heighten both asset- and transaction-level risks.