– Case Study –
AI-Enabled Covenant Monitoring & Reporting
Leading Alternative Investment Firm Automates Manual Tracking of Covenant Breaches and Actionable Items to Streamline Mitigation of Potential Revenue Losses Due to Market Volatility
Challenge
A leading alternative investment firm with AUM $40+ billion was looking for an AI-Enabled Covenant Monitoring and Reporting Solution that could both accurately capture key data fields within trading and legal agreements and act as a centralized repository for all agreements and amendments. To assure compliance, the client sought an AI-enabled solution to automate their entirely manual process where their legal team would enter terms into an excel sheet and perform basic NAV and other covenant calculations by hand. Not only was this process labor-intensive, but also the manual tracking of covenant breaches and other actionable items meant they were not transparent to other teams.
Mitigate Risk & facilitate Transparency
Results
SOLUTION
Innodata’s docAnalytics Platform allows the client’s legal team to seamlessly search, extract, analyze, and manage critical datasets from their agreements. Users can track and reference amendments, query data, and run specific reports that can be shared between teams to minimize information asymmetry. Data point values link directly to the exact location in the source PDF to offer transparency to the source. The intuitive UI allows for the visualization of their risk, and auto-amendment tracking alerts users to the status of covenants that are about to be breached. DocAnalytics also allows seamless API integration with external systems, such as Collateral Management Tools and various risk systems, and can export agreement data into a Data Lake to calculate ATEs (Additional Termination Events) from terms with the agreement.
IMPACT
With docAnalytics, our client has not only been able to automate time-intensive manual processes and gain transparency but has also been able to get in front of potential revenue losses due to market volatility. Leveraging advanced searchability as a discovery tool, the client has been able to explore, visualize, and extract insights from their data. With this new robust line of sight into where their risks lie, they have been able to mitigate potential loss.
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