DBS becomes first major Asian bank to announce AI-driven job cuts

Singapore's DBS has become the first major Asian bank to say it will make significant job cuts as a result of its use of AI, according to The Banker, Report informs.

The cuts come after Italy’s Intesa Sanpaolo said late last year that it could slash up to 9,000 jobs to foster AI growth.

DBS’s chief executive Piyush Gupta told delegates, at a conference run by Indian IT industry lobbying group Nasscom, that over the next three years the bank “will shrink” its workforce by “about 4,000 [people] or 10 percent”.

The jobs at risk at the Singaporean bank will be mainly temporary and contract roles. DBS employs between 8,000 and 9,000 workers on these contracts. Full-time staff will not be impacted.

He said: “In my 15 years of being a CEO, for the first time I’m struggling to create jobs. So far, I’ve always had a line of sight to what jobs I can create. This time I’m struggling to say how I will repurpose people to create jobs.”

Despite the cuts, Gupta said that he expects 1,000 new positions related to AI to be created within the bank.

In October, Intesa Sanpaolo said it would reduce its workforce by 10 percent to accelerate generational change at the bank, and hire 3,500 “young people” by June 2028 to support the adoption of AI and digitalization. The job losses will be split, with 7,000 coming in Italy and 2,000 from the bank’s international subsidiaries.

Citigroup forecast in June last year that 54 percent of banking roles across the industry were at risk from AI-led job displacement, with Bloomberg Intelligence stating last month that major banks could cut up to 200,000 jobs globally in the next five years due to AI.

The Bloomberg Intelligence survey found that, of the chief information and technology officers polled, the consensus was that up to 3 per cent of the workforce could be axed from the world’s biggest banks. However, a quarter of the banking executives questioned believed the job cuts could be higher, at between five and 10 percent of their total workforce.

Back and middle office roles, where work can be repetitive and have the potential for automation, are most at risk.