A recent report by American Banker reveals that 80% of banks have increased their artificial intelligence spending for 2025. This surge in AI investment is driven by the potential for improved efficiency, enhanced customer experience, and increased competitiveness.
Banks are investing in enterprise-grade generative AI models, such as Anthropic's Claude or OpenAI's GPT-4, to leverage their capabilities while ensuring security and safety. For instance, JPMorgan Chase has developed its own LLM Suite, providing employees access to several large language models. They're also spending on software with embedded AI, like Salesforce's Einstein Copilot, to enhance employee productivity and efficiency.
The focus areas for AI investments include fraud prevention and mitigation, cybersecurity breach alerts, operational risk alerts, and code development. Generative AI is being used for code writing, refactoring, and debugging. Additionally, banks are investing in data management software to handle structured and unstructured data, ensuring data quality and security.
Data platform providers like Databricks and Snowflake are receiving significant investments. Banks are also allocating resources to develop testing processes and tools for AI solutions, addressing governance needs and ensuring effective product delivery. Some AI investments are going into core banking upgrades and modernization efforts, recognizing that AI requires modern technology infrastructure, data, models, governance, and more.
Large banks are investing in private AI supercomputers, such as BNY's purchase of an Nvidia DGX SuperPOD, for specific tasks like deposit forecasting and payment automation. The increased investment in AI is expected to drive innovation, improve efficiency, and enhance customer experience in the banking sector.
