In a landmark move for Croatia’s financial sector, the Zagreb Stock Exchange (ZSE) launched an innovative Artificial Intelligence Research (AIR) project in December 2023. Supported by the European Bank for Reconstruction and Development (EBRD) and funded through the Taiwan Business Technical Cooperation Fund, this initiative aims to harness AI, machine learning, and natural‑language processing to automate company valuations, bringing transparency and speed to the Croatian capital market. This is especially relevant in a time when accurate, accessible, and timely financial data is more important than ever. The platform delivers automated, MiFID-compliant company valuations for issuers listed on the Zagreb Stock Exchange (ZSE) Prime Market.
From proof of concept to production
Although AIR began life as a research grant, it now serves real investors. The technical stack was engineered by Zagreb-based data consultancy firm Solvership, while the valuation methodology and final reports are signed by FORVIS Mazars Croatia.
This separation of code and content is not just a technical feature, it’s a legal one. It ensures the platform complies with strict EU regulations on conflicts of interest. While Solvership builds and maintains the technical backbone, FORVIS Mazars is responsible for the content and certifies that each report adheres to MiFID II and the Market Abuse Regulation (MAR) standards.
How It Works
AIR automates the traditionally manual and subjective process of company valuation. The platform parses financial statements, integrates external data, and applies a standardized Discounted Cash Flow (DCF) model—removing much of the guesswork and variability inherent in traditional analysis.
Using Google Cloud Platform (GCP) components like Cloud Functions, SQL databases, and vector storage, AIR automates four critical phases:
- Data acquisition and validation
- Parsing and preparation
- Model-driven valuation
- Report generation and presentation
AI plays a key role in transforming financial PDFs into structured databases. Metrics such as revenue, EBITDA, earnings per share, and debt-to-equity ratios are automatically extracted, calculated, and summarized within minutes.
Financial Analysis
Traditionally, evaluating a listed company requires days of manual work, involving deep analysis of financial statements and dense regulatory reports. The AIR project changes that, by automating data collection and report generation. AI tools can now produce company valuation analyses, drastically reducing reliance on human resources and reducing the risk of human error.
The platform provides identical treatment to all six Prime Market companies selected for the pilot: AD Plastik, Arena Hospitality Group, Atlantic Grupa, Croatian Telecom, Podravka, and Valamar Riviera.
This uniform approach removes human bias and ensures each company is evaluated under the same assumptions, increasing fairness and credibility.
What the AI Actually Does
Under the hood, the platform uses retrieval-augmented generation (RAG) models. These language models ingests the structured database, embeds numerical and textual features into a vector, allowing the system to answer complex financial queries and generate consistent, data-rich narratives.
AIR also supports advanced features like CEO letter summarization, ESG compliance tracking, and dynamic SWOT analysis, all generated directly from official financial documents stored in cloud storage in PDF format.
Conclusion
The AIR platform is already delivering on its promise to bring speed, accuracy, and fairness to Croatia’s capital markets. But this is just the beginning. Future updates will likely introduce multiple AI agents, each specialized in distinct financial tasks, from ESG assessments to predictive risk modeling.
For now, AIR serves as a strong case study in how artificial intelligence, when implemented thoughtfully and in line with regulation, can enhance not only efficiency but also trust in financial systems.
By offering real-time applications for vocational education and training (VET) programs, finance students, and academic institutions, it not only enhances financial literacy but also supports the EU’s broader mission to democratize access to quality financial data and research.
