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Bank of America sets $4b for tech upgrades, expand AI use
Bank of America (BoFA) plans to invest US$4 billion in new tech, including AI, from its US$13 billion tech budget to improve productivity and drive revenue, according to its chief technology and information officer.
The bank, the second-largest in the US, is expanding the use of AI across all business units.
BoFA’s 18,000 developers have used AI agents over the past year, reporting higher productivity and faster completion of routine tasks, such as software testing.
Its virtual assistant, Erica, has handled 3 billion client interactions since launching in 2018, performing tasks that would otherwise require 11,000 staff, including check orders and transaction disputes.
BofA train its 213,000 employees to use AI for automating repetitive work rather than cutting jobs.
Other large US banks, including JPMorgan Chase, Goldman Sachs, and Morgan Stanley, are also rolling out AI tools for bankers and advisers.
🔗 Source: Reuters
🧠 Food for thought
Implications, context, and why it matters.
BofA plans $4 billion in new tech to lift efficiency to 59% to 55%
- Bank of America will invest nearly $4 billion in new technology, including AI, in 2025 as part of a $13 billion tech budget 1. It is targeting an efficiency ratio of 59% to 55%, down from 64% over the first three quarters of 2025 2. Efficiency ratio is noninterest expenses over revenue.
- CashPro Data Intelligence is an analytics tool in the CashPro platform for corporate treasury and cash-management clients 1. Merrill SENSE, used by Merrill, BofA’s wealth-management unit, surfaced $2.5 billion in custom lending opportunities by analyzing advisor notes 1.
- BofA says 18,000 developers used AI agents this year to speed testing and routine coding.
Regional banks feel pressure to ramp up workforce AI training
- By early 2025, 47% of US banks had fully rolled out generative AI, up from 10% in 2023 3. Regional lenders face pressure to scale staff training.
- Vendors should focus on regional banks now because about 75% of banks with over $100 billion in assets are expected to fully integrate AI strategies by 2025, so the window is short before the market fills up 4.
- The Federal Reserve says three in four large companies already use AI, and surveys say firms plan to retrain workforces rather than lay off staff 5. Implementation accelerators include prebuilt tools, templates, and playbooks that move banks from proof of concept to production 4. Only 26% of companies have delivered tangible AI value beyond pilots 4.
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