Morgan Stanley’s latest analysis sheds new light on the technological transformation that will fundamentally change the employment structure of the European financial sector in the coming years. According to the US investment bank’s forecasts, more than 200,000 jobs will disappear from the Old Continent’s largest credit institutions by 2030. Although this reduction is partly due to the progressive dismantling of physical branch networks, the main driver of change is becoming the aggressive implementation of artificial intelligence systems.
For the IT industry, the direction in which the budgets of the 35 largest European banks included in the analysis are heading is key. These institutions are not looking for savings in customer relations, but in the deep back-office. Administration, risk control and compliance departments, hitherto considered bastions of human expertise, are now typified as the main areas for automation. Morgan Stanley estimates that replacing traditional processes with AI algorithms in these sectors could save up to 30 per cent, while offering higher operational reliability and speed of regulatory processing.
This trend is not a purely European specificity, but part of a broader transatlantic ‘digital-first’ strategy. Goldman Sachs, as part of its ‘OneGS 3.0′ programme, froze recruitment last autumn with plans to overhaul processes – from client onboarding to supervisory reporting – based on artificial intelligence. In Europe, concrete numbers are already falling in the strategies of individual players. The Netherlands’ ABN Amro has announced a 20 per cent reduction in staff, and the board of Société Générale is clearly communicating that no area of the bank is exempt from a digital efficiency audit.
However, the enthusiasm for the effectiveness of algorithms is tempered by voices within the industry itself pointing to long-term competence risks. Representatives of JPMorgan Chase, in an interview with the Financial Times, point to the paradox of automation: taking junior analysts out of basic tasks could lead to a generation of bankers lacking fundamental knowledge of market mechanisms.
