U.S. bank executives say AI will improve productivity and reduce jobs

U.S. banks such as JPMorgan Chase & Co. and Wells Fargo & Co. have said artificial intelligence will likely boost corporate productivity and cause job losses.

Marian Lake, head of consumer and community banking at JPMorgan Chase, said at the Goldman Sachs Financial Services Conference that the bank’s productivity has doubled from 3% without AI to 6% with AI.

According to Lake, productivity for operations specialists is expected to increase by 40% to 50%. Higher productivity means less impact on employment on a net basis, she said.

AI represents the biggest technological upheaval for the global economy since the rise of the internet.

It brought trillions of dollars in investment and a dizzying stock market rally, but it also brought memory chip shortages, regulatory scrutiny, and mounting fears about job losses.

Wells Fargo CEO Charlie Scharf added that while the bank is not cutting staff, it is “getting far more done” thanks to AI.

“There are other places where we can look at and understand how we can do more with fewer people,” he said.

“It won’t completely replace humans, but it will create an opportunity to do something very different.”

PNC Financial CEO Bill Demchak said that through the automation and branch optimization process, the bank’s headcount is the same as it was 10 years ago, when the bank was one-third the size.

“You know, the big story right now is that AI is going to drive automation, so it’s going to continue. But we’ve been on an automation journey for years, and AI could very well be an accelerator for that,” he said.

“This will definitely accelerate the number of our technicians.”

Gonzalo Lucchetti, Citigroup’s incoming chief financial officer, said the bank’s coding productivity has increased by 9%.

“Not only will we be able to increase the self-service ratio that we’re already seeing and implementing with Gen AI, but we’ll be able to ultimately assist in real-time calls that would otherwise be handled by a human, making us more productive,” Lucchetti said of the U.S. personal banking sector. Goldman Sachs notified employees in October of possible layoffs and a hiring slowdown through the end of the year, but the Wall Street giant aims to leverage AI to improve productivity, according to an internal memo seen by Reuters.

The memo, which calls the initiative “OneGS 3.0,” says some of the AI ​​initiative’s priorities will be sales and customer onboarding processes, as well as key areas such as lending processes, regulatory reporting, and vendor management. Bank of America plans to spend billions of dollars on technology such as artificial intelligence to make bankers more productive and bring in more revenue, the company’s chief technology and information officer told Reuters last month.