Bank leaders emphasise responsible AI integration amid surging global investment

Banking industry leaders are crucially embedding AI into core strategies, emphasising responsible deployment and human oversight as global AI spending in financial services approaches USD 67 billion by 2028, transforming operational productivity and risk management.

Banking industry leaders are increasingly recognising artificial intelligence (AI) as a core driver of strategic transformation, as global spending on AI within banking is projected to reach nearly USD 67 billion by 2028. This insight emerges from a new report by analytics provider SAS, which synthesises perspectives from executives at prominent banks such as Banorte in Mexico, Intesa Sanpaolo in Italy, Millennium BCP in Portugal, and Old National Bank in the United States. The study underscored five essential lessons for the responsible and profitable adoption of AI technologies in financial services.

Central to these lessons is the imperative for AI initiatives to be fully embedded within the broader business strategy of banks. Leaders emphasise that AI cannot be relegated to isolated projects but must be recognised as a fundamental pillar supported by top-level leadership. Abraham Izquierdo, Managing Director of Trading and Treasury Risks at Banorte, asserted that leadership commitment is “nonnegotiable.” José Miguel Pessanha, Chief Risk Officer at Millennium BCP, highlighted that AI-driven models are playing a pivotal role in enhancing risk mitigation strategies, preparing banks for potential economic downturns by anticipating and managing default risks more effectively.

Despite the rapid technological advancements, the report highlights the enduring importance of human judgement and leadership in AI governance. Andrea Cosentini, Head of Data Science and Responsible AI at Intesa Sanpaolo, described a cultural shift towards valuing data as a strategic asset, which also fosters social benefits such as promoting financial inclusion through innovative lending models for underserved segments. Pessanha reinforced that while AI tools provide critical insights, the creative problem-solving capabilities of leadership remain indispensable for decision-making and strategic risk management.

A solid and harmonised IT infrastructure is regarded as the foundation for effective AI deployment. Millennium BCP’s experience illustrates the challenges of integrating diverse datasets to meet various regulatory and operational requirements, reinforcing the need for banks to “walk before they run.” Old National Bank’s Andrew McCammack highlighted the role of generative AI (GenAI) in driving innovation by assisting in complex coding tasks and enabling the development of scalable AI applications. Izquierdo stressed a cautious, multi-year approach to AI and cloud technology adoption, emphasising short-term goals aligned with long-term compliance and trust-building.

The empowerment of innovation through AI tools is transforming operational productivity. For instance, Old National Bank has automated loan data processing, freeing staff to engage in more analytical and value-added roles. This evolution encourages a culture of inquiry and experimentation, with Millennium BCP fostering an environment where questioning assumptions is encouraged to unlock breakthrough insights and solutions. Banorte’s leadership pointed to enhanced agility in strategic decision-making enabled by data-driven models, facilitating swift responses to market volatility.

Continuous learning and external collaboration remain critical given AI’s fast-paced evolution. Pessanha noted the importance of building connections with academia and startups to stay abreast of emerging developments. GenAI, while a potent innovation driver, requires vigilant human oversight to maintain creativity, responsibility, and strategic judgment at the centre of AI initiatives, as emphasised by Cosentini. Banorte is leveraging generative AI notably to strengthen cybersecurity and support business continuity, illustrating AI’s growing role in operational resilience.

Trust and governance are highlighted as paramount in AI adoption within banking. Stu Bradley, Senior Vice President of Fraud, Risk and Compliance Solutions at SAS, reminded that trust is “financial services’ most valuable currency—and its most fragile.” Responsible deployment of AI, underpinned by robust governance and guardrails, is essential to harness benefits without escalating risks. The SAS report thus positions AI not merely as a technological enhancement but as a strategic imperative tightly interwoven with long-term growth, risk management, and enhanced customer service in banking.

These findings resonate within a broader context of rapidly escalating AI investment worldwide. Industry analysis from IDC forecasts global AI expenditure will more than double to $632 billion by 2028, with financial services expected to command over 20% of this investment. This surge is driven by the integration of generative AI, which alone is projected to grow at an annual compound rate of 59.2% over five years, underscoring the transformative potential of AI applications across sectors. The United States is anticipated to remain the largest AI market, with spending expected to reach $336 billion by 2028, reflecting the intense competition and innovation focus within its financial ecosystem.

Moreover, projections by organisations such as Citigroup indicate that major technology companies will drive massive AI infrastructure investments, with global expenditure reaching $2.8 trillion by 2029. This trend highlights the interconnected nature of AI advances, where the financial services sector not only innovates internally but also interacts with broader technology ecosystems shaping the future of AI.

In summary, bank executives are steering AI adoption with a clear emphasis on responsibility, strategic alignment, and human-centred oversight. These practices are vital in a rapidly evolving landscape where AI promises significant economic contributions—estimated to add nearly $20 trillion to the global economy by 2030—while simultaneously demanding rigorous governance to sustain trust and compliance.

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Source: Fuse Wire Services