HSBC has become the latest bank to announce it is experimenting with quantum technology.
The global bank and asset servicer has partnered with tech firm Terra Quantum to test the use of quantum computing for capital allocation.
More specifically, the tests focus on how the technology can be used for collateral management – for example, how high-powered algorithms can be used to manage risks, liquidity and profitability.
To date, firms have relied on so-called linear problem solvers. However, the use of quantum technology could allow for high-dimensional problems to be solved at a greater scale.
To date, most quantum use cases have focused on cybersecurity, although in 2022, Spanish institution Caixa Bank developed an app for portfolio selection using quantum technology.
The partnership with Terra Quantum is not HSBC’s first such collaboration. In July, it announced a similar initiative with UK tech firm Quantinuum. And in 2022, HSBC agreed a multi-year deal with IBM to explore the technology.
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