Citi issues stark warning on automation of bank jobs
Bank says it will shed up to half of its 20,000 technology staff over next five years
Citi investment bank has suggested that it will shed up to half of its 20,000 technology and operations staff in the next five years, as machines supplant humans at a faster pace.
The forecast by Jamie Forese, president of Citi and chief executive of the bank’s institutional clients group, was the starkest among investment banking bosses in a series of FT interviews to mark the 10th anniversary of the financial crisis.
Mr Forese said the operational positions, which make up almost two-fifths of investment bank employees at Citi, were “most fertile for machine processing”.
“We’ve got 20,000 operational roles. Over the next five years could you make it 10,000?” he added, in comments that had echoes of former Deutsche Bank chief executive John Cryan’s claim that up to half of the German bank’s workforce could be replaced by technology.
If replicated across the industry, the potential job losses would represent a steeper rate of cuts than in 2007-2017, when almost 60,000 jobs were cut from eight of the world’s top 10 investment banks, according to FT research. Two of the top 10 investment banks were not included in the FT research; Citi, because its data were not available; and Bank of America because its 2008 merger with Merrill Lynch make pre-crisis comparisons futile.
“If your job involves a lot of keyboard hitting then you’re less likely to have a happy future,” he added.
Not every investment bank boss saw plenty of room for more cuts. At HSBC, Samir Assaf, head of global banking and markets, said there was “not much more to go” for technology replacing investment bank staff.
“We get to a point from a risk-management perspective [where you can’t cut much more]. I think there is maybe another 5 to 10 per cent to go between now and the next five years.”
Mr Gnodde stressed that technology could create new business opportunities and ultimately new jobs, such as Goldman’s fledgling online only consumer bank Marcus.
Mr Forese said his bank would hire in other areas such as sales and research. “What people are doing, the type of work being done by the human rather than the machine will change,” he added. - Financial Times