SMBC deploys OakNorth’s commercial lending software and invests $30m in the fintech business

OakNorth, the next-generation artificial intelligence software business, today announces the successful deployment of its Credit Intelligence software with SMBC. The partnership with OakNorth will provide SMBC with superior insight into its commercial loan book and borrowers in the US and Asia, as well as drive process automation and efficiency in its portfolio monitoring.

SMBC places digital innovation at the heart of its business strategies. Through active engagement with fintechs such as its collaboration with OakNorth, and the establishment of its own innovation centres across the world, SMBC is committed to supporting the growth ambitions of US and Asian businesses. In its new Medium-Term Management Plan, SMBC Group announced that it would increase profit through “Transformation”- the comprehensive optimization and remodelling of its businesses – and “Growth” – the pursuit of new growth opportunities.

OakNorth’s enterprise software combines a deep understanding of credit, dynamic data sets, auto-analysis capabilities, cloud-computing and state of the art machine learning, to deliver an extraordinary borrowing experience for businesses. Its credit and monitoring tool is informed by industry benchmarks, peer analysis, and scenario analysis to improve the quality, consistency and speed of commercial lending decision making. Through analysing each borrower’s data in the context of its geography and sector and monitoring a borrower against its peers, the software is able to alert lenders such as SMBC when a loan, or borrower needs attention as well as assisting in providing granular information to regulators.

In addition to deploying OakNorth’s Credit Intelligence software, SMBC participated in a secondary purchase of shares, making a notable investment of $30m in OakNorth Holdings Limited.

Rishi Khosla, co-founder of OakNorth, commented: “SMBC continues to transform itself to adopt to changes in society and the economy. This partnership and investment is a clear demonstration of SMBC’s commitment to define the commercial banking model of the future and become the leading choice for businesses around the globe. Like us, SMBC wishes to create a better borrowing experience for businesses.”

Toru Nakashima, Group CFO and CSO, commented: “SMBC Group announced in its new Medium-Term Management Plan that it would increase profit through “Transformation”- the comprehensive optimization and remodelling of its businesses – and “Growth” – the pursuit of new growth opportunities. Through this investment and the upcoming business alliance with OakNorth, SMBC strives to create new added value by bringing a high level of sophistication to its corporate lending platforms. We are further harnessing the power of AI through big data and machine learning across our strategic markets in South East Asia, such as Indonesia.”

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Author: Lauren Towner