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Moody's: Japanese brokerage consortium to improve systems is credit positive

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Moody's: Japanese brokerage consortium to improve systems is credit positive

A consortium led by Japan's SBI Holdings Inc. to jointly develop and share systems using new technologies is credit positive, Moody's said Feb. 5.

SBI Holdings said it will organize a consortium involving 18 securities companies, including Nomura Holdings Inc. and Daiwa Securities Group Inc., to jointly develop and share systems using blockchain, artificial intelligence and other new technologies.

The rating agency said the initiative will improve the participating companies' operational efficiency and reduce costs. It will also help the companies compete against external disrupters, such as financial technology startups.

The consortium will be divided into three groups focused on client screening and identification processes, clerical work and distributed ledger technology. It will use the technology to create a client authentication platform and will enable the companies to share client information amongst themselves and assist in client screening.

Moody's notes that the new system will greatly reduce the hassle for customers relating to lengthy and complex application processes, as well as allowing securities companies to increase their focus on more profitable high-end customers.