UBS has moved 80 people into a new artificial intelligence unit designed to future-proof its fixed income division and stave off threats from tech start-ups aiming to grab market share from large investment banks.
The Swiss bank has shifted its co-head of fixed income trading, Chris Purves, into the unit to lead the operation, which features data scientists, technologists, machine learning experts and electronic trading specialists.
The unit, called the Strategic Development Lab, will also look at ways of using artificial intelligence on the trading floor, and is tasked with ensuring UBS’s fixed income division remains “fit for purpose” by 2025, as banks battle a range of fintech startups, Purves said.
Investment banks’ fixed income divisions trade bonds, commodities, government debt and movements in the foreign exchange market on the behalf of their clients. FX and rates have long been traded electronically, but corporate bonds remain an illiquid and complex market traditionally traded over the phone.