In recent years, European banks have turned to artificial intelligence (AI) as a pivotal tool for cost management and operational efficiency. This strategic move is reshaping the financial landscape, with Italian lender BPER Banca SpA at the forefront of these innovations. BPER has announced a significant workforce reduction, leveraging AI to streamline processes and optimize costs. This is part of a broader trend where financial institutions are investing heavily in AI technologies to remain competitive in an evolving market.
BPER Banca SpA’s plan to cut its workforce by approximately 2,000 employees is a notable example of how AI is being used to reduce staff costs. By 2027, this reduction will bring the bank’s headcount to about 18,500. The bank is implementing AI and generative AI tools to automate processes and optimize workflows, enhancing overall efficiency. BPER also aims to transition more of its sales to digital channels, reflecting a broader shift towards digital banking.
BPER’s strategy aligns with a growing trend among major banks across Europe. Citigroup Inc. has projected that AI could displace more jobs in banking than any other sector, potentially boosting global profitability by $170 billion in the coming years. This prediction underscores the transformative potential of AI in the banking sector.
UBS Group AG has developed an AI tool specifically for analyzing mergers and acquisitions (M&A) deals, while CaixaBank SA plans to make AI a cornerstone of its new strategic direction. The emphasis on AI is also evident at JPMorgan Chase & Co., where CEO Jamie Dimon envisions AI reducing the workweek to 3.5 days, highlighting its potential to enhance productivity.
Other major banks are also embracing AI to improve various aspects of their operations. Deutsche Bank AG utilizes AI for portfolio scanning, and ING Groep NV employs AI for default risk screening. These technologies enable banks to manage portfolios more effectively and identify potential risks with greater precision.
While AI enables significant cost savings through workforce reductions, banks are also investing in strategic areas to support their digital transformation. BPER, for instance, plans to hire 1,100 new employees, focusing on IT and other strategic areas, to bolster its digital capabilities.
This shift towards AI-driven processes represents a fundamental change in how banks operate, emphasizing the need for continuous innovation to stay ahead in a competitive market. As AI continues to evolve, it will undoubtedly play a crucial role in shaping the future of the banking industry, driving both cost efficiencies and new growth opportunities.
