Pagaya, which uses artificial intelligence to manage institutional money, is issuing a second $100 million actively managed asset-backed securities (ABS) offering, the U.S.-Israeli fintech firm announced today. This follows Pagaya’s first $100 million ABS deal fully managed by AI in February.

Since its founding in 2016, Pagaya has grown to $650 million in assets under management. CEO and co-founder Gal Krubiner said securing a second ABS deal in a span of just a few months proves there is market receptivity to the firm’s structure and active management approach. Pagaya is using AI to boost the standard return for low-risk investments, consistently outperforming incumbents and providing detailed analysis. So, while the markets at large experienced hiccups during flare-ups of the U.S.-China trade standoff or each time interest rates are hiked, Pagaya’s performance has remained stable throughout those periods, he noted.

“A lot of it is stability and predictability,” Krubiner said of the company’s value proposition to financial institutions. “What happens when credit officers are underwriting is they have a very good sense or a potential sense of a specific time and place, but they don’t have the ability to grasp the full picture.”

For its latest ABS deal, led by structuring agent Cantor Fitzgerald, Pagaya said its AI will analyze millions of data points to select and purchase individual loans rather than package a pool of previously assembled assets based on one to two data points. “Pagaya has created one of the most relevant applications of AI in the credit space,” said Marshall Insley, co-head of structured products at Cantor Fitzgerald, in a statement. “We’ve seen strong demand over the past two deals.”

Ed Mallon, who joined Pagaya as chief investment officer last year, is a 20-year veteran of BlackRock. He said AI is enabling Pagaya to do “a deeper fundamental credit underwriting of assets that have a significant amount of data attached to them.” Since most players today are buying loans on a more passive basis and taking advantage of the existing securitization market rather than doing credit selection, competition with Pagaya is scarce, he noted.

Pagaya doesn’t expect much competition from incumbents, Mallon noted, adding that these companies still have too many incentives to outsource the innovation and research work involved. “Certainly, there are a lot of discussion about AI as we speak to large, sophisticated institutions that are investors in our portfolio, but it takes unique resources to do this,” he said.

Institutions with deeper pockets, like JPMorgan Chase and Morgan Stanely, have spent heavily to deploy AI and machine-learning in their investment banking units. JPMorgan last year launched an equity data science team within its asset management business to explore uses for AI in improving investment decisions.

Pagaya, which focuses on fixed income and alternative credit, has a growing global investment team of 40 data scientists and AI specialists, as well as 1o finance specialists. The company also is making progress on expanding into new asset class areas including real estate, auto loans, corporate credit and mortgages after a $25 million Series C financing round in April led by Oak HC/FT, a healthcare and fintech venture firm.