Big banks such as Goldman Sachs, Bank of America, Morgan Stanley, Wells Fargo, and JPMorgan Chase are increasing their efforts in AI adoption to boost profits. They are hiring specialized talent, creating new technologies, and forming partnerships to transform their businesses. The potential for AI adoption to increase banking profits by up to $170 billion by fiscal year 2028 has been highlighted in research from Citi analysts. The early-stage use cases for generative AI are focused on augmenting staff to improve productivity, but there is a shift towards testing external-facing use cases in the near future.
Wall Street firms like Morgan Stanley and Wells Fargo are implementing AI assistants powered by OpenAI and Google Cloud respectively to enhance customer service and streamline internal processes. These AI assistants aim to free up employees from repetitive tasks so they can focus more on building relationships and innovation. For example, Morgan Stanley’s AI assistant has been developed to help financial advisors with tasks such as answering market questions and taking notes during client meetings. These initiatives could have a significant impact on improving advisor productivity and reaching management’s financial goals.
Partnerships with tech companies are crucial for banks to access large language models (LLMs) and develop their AI products. Deutsche Bank has collaborated with Nvidia for fraud protection apps, while BNP Paribas and TD Bank Group have partnered with Mistral AI and Cohere to embed LLMs across various businesses. These partnerships enable banks to leverage advanced AI capabilities and enhance customer services, sales, and IT operations. The focus on AI adoption has led to a significant increase in hiring of AI talent within the banking sector, with banks actively recruiting data scientists, data engineers, machine learning engineers, and software developers.
The commitment to AI innovation is evident in the continuous hiring of AI talent by top Wall Street firms. Despite layoffs in the banking industry, AI talent at banks has grown by 9% in the last six months. Banks are prioritizing the recruitment of AI experts to drive their AI initiatives forward and stay competitive in the evolving technological landscape. Wells Fargo appointed Tracy Kerrins as the head of consumer technology to lead the generative AI team, while Morgan Stanley promoted Jeff McMillan to head of firmwide AI after overseeing OpenAI-related projects. JPMorgan also appointed Teresa Heitsenrether as chief data and analytics officer to lead AI adoption efforts.
The significant investments in AI talent, partnerships, and new use cases by big banks demonstrate their commitment to leveraging AI technology for long-term growth and innovation. While the returns on these investments may not be immediate, the potential for AI to revolutionize banking operations and drive profitability is substantial. Analysts predict a real tipping point in AI adoption by 2026, leading to increased ROI generated from AI use cases. As banks continue to explore the potential of AI, they are positioning themselves for future success in the fast-evolving financial industry.
