Deutsche Bank executive Dennis Lu said on Thursday (June 18) that artificial intelligence (AI) has enabled banks to reduce the completion time of some operations from two years to as little as three months, Reuters reported on Thursday.
Lu, chief information officer for Deutsche Bank’s investment banking division, told Reuters the bank uses a simpler model for day-to-day operations and is cautious about introducing the technology into everything.
The bank is currently developing AI tools to automate the extraction and analysis of financial data and link external events to portfolios to measure exposure, the report said.
To manage the cost of AI, Deutsche Bank allocates tokens to engineers and grants more requests if they can prove their value, Lu said in the report.
“We don’t want to slow people down, we want them to keep moving forward, but we also want to get something in return,” Lu said in the report.
According to the PYMNTS Intelligence report, “Financial Services Advances in the Enterprise AI Race,” 85% of financial services and insurance companies with at least $1 billion in annual revenue plan to increase their AI budgets over the next 12 months.
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When asked to justify their investment in AI, 65% of these companies pointed to increased productivity and efficiency, 65% emphasized strategic/competitive position, and 55% cited risk mitigation and compliance.
“These are results-oriented justifications, and AI investments need to demonstrate tangible benefits,” the report states.
When asked about the most deployed AI tasks, 65% of financial services and insurance companies said they focused on revenue recognition and accounting, 60% focused on credit risk assessment and scoring, and 60% focused on sales forecasting and pipeline optimization.
“The industry’s most adopted use cases center around structured and auditable back-office functions, the internal operations that keep the business running but are not directly visible to customers,” the report said.
In a recent report, Nvidia said that nearly 90% of financial institutions have implemented or are evaluating AI, and 65% are already using the technology.
KPMG found that 70% of bank CEOs plan to allocate 10% to 20% of their budgets to AI next year. 24% of these CEOs say the biggest benefit of implementing AI is improved cybersecurity.
