Assured Guaranty subsidiary developing municipal fintech platform
A municipal fintech platform for asset management firms, banks, insurance companies and municipal advisors is being developed by Assured Guaranty’s new subsidiary, AG Analytics.
The platform aims to deliver best-in-class technology and turnkey solutions to replace fragmented data resources used by municipal asset managers, analysts and other market participants.
“Many asset managers use too many systems to do one job,” said Justin Land, CEO of AG Analytics. “The municipal market needs better research tools”.
For a credit investigation report, an asset manager typically needs six to eight systems, he said. “But this fintech platform would allow ‘one-stop shopping’ where analysts, portfolio managers and traders have one system fully integrated with the information just analyzed based on the user profile.”
Assured Guaranty created AG Analytics “to develop software and data technology for municipal asset managers that bring credit analytics and financial, environmental and governance data in one place to make credit research more scalable.”
Assured Guaranty’s guaranty department already uses the core software and underlying data that will be integrated into a dynamic data-driven tool built inside the AG Analytics platform to assess potential risks for obligors in its guaranteed portfolio.
This tool examines risk and resilience at the debtor level for the public finance sector. AG Analytics intends to continue to develop its platform to include a wide range of fintech tools that streamline data-intensive analyzes for municipal experts.
The platform is designed to be a “data agnostic system”, meaning clients can add their data and model it. “It’s important for us to build a system that any user with their own data, whether it’s proprietary or they want to buy it from another source, can put into the system,” Land said. “I don’t know of any municipal credit analysis software that allows you to do that; they tend to be closed systems.”
Land sees the new municipal fintech platform as the future of the industry.
“We’re seeing fees continue to fall in the fixed income and municipal space, particularly in investment grade,” he said. “And either you use technology to improve margins and reduce expenses or your profitability declines. The workflow and triaging and connecting that to market data is going to create powerful tools and ways to look at municipal credit and trade in avenues that haven’t been explored yet .”
