AI Is Coming for European Bank Jobs With Italy Taking a Hit

Posted by Admin October 10, 2024 Jobs

(Bloomberg) — European banks are beginning to cut staff costs by deploying artificial intelligence tools, with Italian lender BPER Banca SpA becoming one of the first to put hard numbers on the impact.

BPER said Thursday that it plans to reduce its workforce by about 2,000 over the coming years as advances in AI boost output. The bank will rely on “AI/GenAI-enabled process optimization and automation” to cut headcount by 10% through 2027 to about 18,500.

The Italian bank joins a growing number of lenders in betting on traditional and generative artificial intelligence to improve efficiency and reduce costs. Citigroup Inc. has said that the technology is likely to displace more jobs across the banking industry than in any other sector, helping to increase profitability in the sector globally by $170 billion over the next few years.

In Europe, UBS Group AG has developed an artificial intelligence tool to help it offer clients potential M&A deals, able to analyze a database of over 300,000 companies in less than half a minute, while CaixaBank SA, Spain’s third-largest bank by market value, is planning to create a team of hundreds of artificial intelligence and IT experts.

The Spanish lender is planning to make AI one of the pillars of a new strategy it plans to unveil next month, Bloomberg reported last week.

JPMorgan Chase & Co. is scooping up talent and Chief Executive Officer Jamie Dimon has said he believes the technology will allow employers to shrink the workweek to just 3.5 days. Deutsche Bank AG is using artificial intelligence to scan wealthy-client portfolios. And ING Groep NV is screening for potential defaulters.

BPER’s staff reduction is to take place “through voluntary exits already agreed upon and natural turnover,” it said Thursday. Other measures such as shifting sales from branches to digital channels will also play a role in shedding roles, it said. The measures will result in about 3,100 overall departures through 2027, with the lender simultaneously aiming to make 1,100 new hires in “strategic areas” including IT.

(Updates with further background)