The global banking sector may face up to 200,000 job losses in the next three to five years due to the rising adoption of AI, according to a report from Bloomberg Intelligence.

A survey of chief information and technology officers indicated an estimated workforce reduction of about 3%. Back office, middle office, and operational jobs are the most vulnerable.

AI is anticipated to affect roles involving repetitive tasks, including customer service and know-your-customer functions, where automation is expected to increase.

Nearly 25% of the 93 respondents in the survey believe that job cuts could reach between 5% and 10%, although many banks maintain that AI will change roles rather than eliminate them entirely.

The report analyzed data from major banks, including Citigroup, JPMorgan Chase, and Goldman Sachs.

GenAI is projected to boost productivity and revenue, with eight out of ten respondents expecting at least a 5% increase in productivity and profits over the coming years.

Bloomberg Intelligence estimates that banks could experience pretax profits rising by up to US$180 billion by 2027 as a result of AI-driven efficiency improvements.

Since the 2008 financial crisis, the banking industry has been modernizing its IT infrastructure, which is increasingly integrating advanced AI tools to optimize operations.