Automation Finds Investment Bankers

A lack of motivation to improve the status quo and disagreement as to the benefits of automation have created a culture within investment banking that relies on manual processes and hinders technological advancement, according to Needham, Mass.-based TowerGroup. But a new research note from the consultancy argues that technology is wedging itself into investment banking processes and is, for the betterment of the industry, forcing automation in new-issue deal management.

The origination process -- the pitching, winning and structuring of a deal -- is driving tech spending in order to improve CRM, data modeling, data feeds and document management, and will account for 82 percent of total technology spending by investment banks in 2006, reports TowerGroup. The consultancy expects investment banks to focus their tech investments on creating portals for bankers to use in deal management, with most of the 2006 spend (29 percent) going to data vendors. Automating syndication -- the book building, execution and servicing of the deal -- will account for 18 percent of tech spending. <<<