AI. Reuters Union News 

Morgan Stanley predicts that approximately 200,000 jobs in the European banking sector could disappear over the next five years due to increased adoption of artificial intelligence (AI) and branch closures.

According to the British daily Financial Times (FT) on the 31st (local time), Morgan Stanley analyzed 35 European banks and estimated that 10% of the workforce could be reduced by 2030 through cost savings using AI and the online migration of tasks.

With the current employee count in these 35 banks at approximately 2.12 million, this forecast suggests a potential loss of around 212,000 jobs.

The job reductions are expected to be concentrated in central service departments, including risk management, regulatory compliance, and administrative roles for operational support.

"Many banks have mentioned efficiency improvements of up to 30% resulting from AI and further digitalization," Morgan Stanley reported.

European banks are under pressure to improve their return on equity (ROE) and reduce costs, lagging behind their U.S. counterparts. They are citing AI as a catalyst to aid their restructuring efforts.

Last month, Dutch bank ABN AMRO announced plans to reduce its permanent staff by approximately 20% by 2028. In March of this year, France's Societe Generale stated that there were no sacred cows when it came to cost reductions.

Switzerland's UBS has been transmitting videos created by AI avatars of analysts to clients since the first half of this year. In recent months, they have also sent 250 senior executives to Oxford University for an AI leadership event.

However, voices of caution are also being raised regarding the premature adoption of AI in the banking sector.

Conor Hillery, Co-CEO of JPMorgan Chase for Europe, the Middle East, and Africa, warned that while excitement around AI is understandable, the industry must be careful not to lose sight of fundamentals. He cautioned that the sector will face significant challenges if a balance is not struck between utilizing AI in core operations and training new employees.