Shinhan Group launches AI stock advisory firm

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Shinhan Group launches AI stock advisory firm


Cho Yong-byoung, Shinhan Financial Group chairman, talks with employees at Shinhan AI in Yeouido, western Seoul, on Tuesday. [SHINHAN FINANCIAL GROUP]

Shinhan Financial Group, Korea’s largest financial holdings unit, launched investment company Shinhan AI that is solely devoted to providing automated, algorithm-based financial advisory services on Tuesday.

The move represents the financial company’s commitment to automated investing service by taking a step further from providing funds structured and managed by robo-advisors.

Shinhan AI will aim to serve people looking to invest smaller amounts who are likely to be underserved by established asset managers that focus on high net wealth individuals.

“Shinhan AI will bring quality investment advice once reserved for high net wealth clients to more people,” a spokesperson at Shinhan Financial Group said.

NEO, an artificial intelligence (AI) platform designed to offer asset management advice, will be at the forefront of the advisory service.
Equipped with the vast financial markets data over the past 30 years, the platform is backed by IBM’s Watson system to recommend investment portfolios.

Presently, the main area of business will be confined to investment advice, but later will expand into the risk management, credit rating and compliance sectors.

To strengthen the competitiveness of its AI platform, the financial group has created partnership with other companies and research institutions including Element AI, a Montreal-based AI software start-up, and KAIST.

“Shinhan AI will develop into a competitive AI company capable of competing on a global scale,” said Cho Yong-byoung, chairman of Shinhan Financial Group, during an inauguration ceremony on Tuesday.

On route to creating an AI-focused financial unit, the group initiated a project with Shinhan’s financial affiliates and IBM back in 2018. The affiliates include Shinhan Bank, Shinhan Investment, Shinhan Life Insurance and Shinhan BNP Paribas Asset Management Company.
Alongside that project, the group applied for the license required for an investment advisory service in July through the Financial Services Commission (FSC).

The automated investment service recently gained a regulatory boost as the FSC allowed robo-advisors to fully manage funds.

Before the reform, the regulator required human engagement to ensure that the process is conducted in a secure manner.

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