AI Adoption in Banking: Savings Emerge in Specific Workflows
Banks are investing heavily in artificial intelligence (AI), but the returns on investment are not yet evenly distributed across their institutions.
A report by the Bank of England and Financial Conduct Authority found that 75% of surveyed financial firms were already using AI, with another 10% planning adoption within three years. However, the realized economic benefits of AI adoption vary significantly between firms and depend on implementation quality, staff capability, and human oversight.
The savings from AI are emerging in specific workflows such as software development, transaction screening, and customer due diligence. For example, JPMorgan Chase reported a 10% to 20% increase in productivity gains for its software engineers using AI coding assistants.
DBS also reported that generative AI enabled it to compress work such as test-case generation and documentation of user stories from months to weeks. Its CodeBuddy tool produced time savings of up to 20% on certain coding tasks, while code deployment time was cut by 25%. Model deployment cycles were reduced to seven to ten weeks.
The back office is where AI can remove the most repetitive work, such as transaction screening and customer due diligence. For instance, JPMorgan Chase's Commercial & Investment Bank said AI enabled it to review more than twice the transaction volume while cutting the number of manual operator checks by half.