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Posted 15 October 2009

New UCD-led research cluster to boost IFSC capabilities

Government highlights importance of financial services sector with investment in strategic five-year industry/academic research project

In a Government initiative to safeguard and expand Ireland’s international financial services capabilities, the Tánaiste and Minister for Enterprise, Trade and Employment, Ms Mary Coughlan, TD, announced the establishment of a new Science Foundation Ireland (SFI) Strategic Research Cluster - the Financial Mathematics and Computation Cluster (FMC2) involving a Government investment of over €4 million with an additional contribution of over €600,000 from industry partners in the programme, Pioneer Investments, Ryan Capital Ltd and The Institute of Bankers in Ireland.

Pictured far right: Giordano Lombardo, Chairman of the Directors, Pioneer Investment Management with Professor Anthony Brabazon, Director of UCD Natural Computing Research and Applications Group, Mary Coughlan, Tanaiste and Minister for Enterprise, Trade & Employment and Professor Frank Gannon, Director of SFI.

The FMC² research cluster will create a centre of financial research excellence by bringing together complementary expertise in financial mathematics, financial economics and computer science.

Led by UCD’s Anthony Brabazon, Professor of Accountancy, UCD Michael Smurfit Graduate Business School and a member of CASL (Complex and Adaptive Systems Laboratory), the research team will involve two CASL colleagues; Dr Michael O’Neill, UCD School of Computer Science & Informatics, Dr David Edelman, UCD Michael Smurfit Graduate Business School as well as Professor John Cotter, UCD Michael Smurfit Business School in collaboration with Dublin City University, NUI Maynooth, the University of Ulster, University of California, Los Angeles (UCLA), Columbia University, Federal Reserve Bank of New York and Technical University of Kaiserslautern, Germany.

Announcing the funding and emphasising the strategic importance of FMC² the Tánaiste said “the IFSC currently generates approximately €22 billion in services exports annually. The International Financial Services Centre has been an outstanding success story in the Irish economy over the last 20 years, employing in excess of 25,000 people and generating 35% of our service exports.

Today, the establishment of the FMC² SFI Strategic Research Cluster further builds on this and dispels any notion that scientific research and investment is primarily theoretical and somewhat removed from the day-to-day economic activity of our country. Global events of the past 18 months have shown us just how interconnected different sectors of our society really are in an economic content. Such interdependency highlights the need for diverse disciplines to converge and work in unison towards recovery. This new SFI Strategic Research Cluster does just that, as it brings together complementary expertise in financial mathematics, financial economics and computer science to create a multi-disciplinary research centre.”

Research at FMC² will initially concentrate on the development of theory and methods for the task of asset management to greatly enhance the development of, and future employment growth, in the international financial services industry in Ireland. Industry partners involved with FMC² so far are Pioneer Investments, Ryan Capital Ltd and The Institute of Bankers in Ireland.

The Tánaiste added “Science Foundation Ireland’s SRC programme has been connecting researchers with industry with the focus on the generation of new partnerships, research breakthroughs and commercial outputs. The Government has steadfastly continued and, indeed, significantly expanded, its programme of strategic investment in our highly-skilled, scientific research base over the past decade. Such ongoing financial support is important in the context of initiating Ireland’s economic recovery, in maintaining our reputation internationally, and in signalling to the world that, notwithstanding a prevailing recession, Ireland’s capacity and ambition in the scientific field is unwavering.”

Professor Anthony Brabazon, head of the FMC² research team, re-iterating the strategic relevance of the centre to the financial services industry in Ireland said “of course, firms in the IFSC are facing ever increasing pressures from competitors in other jurisdictions so we need to ‘up our game’ if we want to continue to grow employment in this sector. A key enabling factor is the deepening of the pool of high-calibre, financially-trained graduates with quantitative skills for employment in financial services firms.

This cluster forms a pivotal element of national infrastructure, creating a critical-mass research centre which will undertake research and training for the financial services industry. A prime objective of the research cluster is to support industry product and process innovation in order to grow employment in the financial services sector in Ireland. The cluster’s researchers will be working directly with our industrial collaborators in order to help achieve this goal.” he added.

Robert Richardson, CEO, Pioneer Investment Management Limited, Ireland said, “we are delighted to be a part of this project with University College Dublin and thank Science Foundation Ireland for their valuable support. For Pioneer Investments, research has always been central to our business model over the past 80 years. We are pleased with the opportunity to be able to provide our international industry expertise to this strategic collaboration. We are very optimistic that through this project we can further enhance our in-house quantitative research capabilities and contribute to the development of the quantitative research discipline in Ireland.”

Director-General of SFI, Prof. Frank Gannon, in welcoming the Tánaiste’s announcement, said “FMC² will provide expertise to the financial services sector. Focusing on the three fundamental elements of financial markets – risk, information and liquidity, FMC² will undertake world-class research in areas of strategic relevance to the financial services industry in Ireland. By training highly skilled PhD and post-doctoral researchers for the financial services sector, Ireland will be able to develop high-end asset management and financial products which will underpin the future development of the international financial services sector in Ireland, and foster employment growth in companies already located here as well as increasing the attractiveness of Ireland as a location for new foreign direct investment.”

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New UCD-led research cluster to boost IFSC capabilities