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  • Writer's pictureSarah Ruivivar

AI: The Future of Productivity in Banking

Updated: Oct 29, 2023

Banking bigwigs are buzzing about the potential of Artificial Intelligence (AI) to supercharge productivity. As lenders increasingly adopt AI, they're expecting significant efficiency gains.

Back in 2017, Deutsche Bank's then-CEO, John Cryan, made a bold prediction: robots would replace about half of his 98,000-strong workforce over time. Former Citigroup CEO Vikram Pandit soon followed suit, suggesting that AI and robotics could eliminate 30% of global banking jobs within five years.

Fast forward to today, and these predictions have proven somewhat overzealous. Deutsche Bank's headcount has only dropped by 10% since Cryan's forecast, largely due to routine cost-cutting rather than an AI uprising. Meanwhile, employment numbers in the New York securities industry have actually risen almost 8% between 2017 and 2022.

However, the banking sector's optimism for AI remains high. The focus has shifted from flashy use cases, like HSBC’s robot bank teller Pepper, to more practical productivity gains.

Deutsche Bank’s chief technology, data and innovation officer, Bernd Leukert, believes AI is a "profound opportunity" to drive efficiency and automation, as well as significantly improve customer engagement. HSBC’s chief operating officer, John Hinshaw, agrees, arguing that AI is ideally suited to bring together legacy technology and harness banks' vast data reserves.

AI is already making an impact in risk, compliance, and enterprise functions. It's also being used as a customer acquisition tool, offering personalised promotions based on customer profiles built using AI.

Deutsche Bank is using AI to improve code writing, aiming for a "double-digit" percentage productivity boost by the end of 2023. The bank is also trialling AI to handle staff IT and HR queries and hopes to use the same technology for client interactions, subject to regulatory approval.

HSBC is using AI in an anti-money laundering tool and for predicting when ATMs will run out of cash. Hinshaw also sees potential for AI-enhanced workplaces, where AI recognises workers, knows their schedules, and even reorders their breakfast!

While the journey is only just beginning, the potential for AI in banking is enormous. As the industry continues to embrace AI, the focus isn't on job elimination, but on doing more with the same number of people and creating a more enjoyable workplace. The future of banking productivity is looking bright, and it's powered by AI.

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