AFTAs 2020: Best Collaboration Initiative—Finos

Open-source technology has become a fixture on Wall Street, thanks to realities like the downward pressure on margins in financial institutions over the last decade, the rise of cloud technology, and the urgent need for more tech talent to drive innovation. That is why the Fintech Open Source Foundation (Finos) is bringing open source, open standards and collaborative software development to the capital markets, and has won the 2020 AFTA for the best collaboration initiative. 

Over several years, Goldman Sachs developed Legend, a data platform designed to address data efficiency and governance within the financial services industry. Legend, originally called Alloy, was developed for internal use within the bank, but its source code is now open in Finos, and a shared environment was made available by Finos for industry participants to use and build models collaboratively.

Legend was piloted in 2020 with a number of investment banks, including Morgan Stanley, Deutsche Bank and RBC. “In 2020, we saw the major uptake in not only participation from major banks, but actually the active contribution of open source code from these institutions. That was our biggest milestone we achieved this year,” says Gabriele Columbro, founder and executive director of Finos. “This is unprecedented. In previous years, banks consumed open-source technology, but they did not realize the full potential of what it means to strategically gain efficiencies by means of collaborating ‘the open-source way,’ both at a technology and a business level,” Columbro explains. 

Legend used a shared version of the data platform, hosted on Finos’ infrastructure, to prototype interbank collaborative modeling, in particular to build extensions that were contributed back to the International Securities and Derivatives Association’s (Isda’s) Common Domain Model (CDM). The Isda CDM is a blueprint for how derivatives are traded and managed across the trade lifecycle, and the ability to use this standard will allow greater efficiencies for the industry.

Columbro says that besides delivering value to the technology organization, as the Legend platform can be freely downloaded, installed and modified under an open-source license, the non-profit is seeing an important uptake and major potential in leveraging its sandbox to build common models that regulators could also use.