The ASX 200 banking sector has become increasingly competitive. In particular, the big 4 banks are continuously battling to win market share.
Yesterday, I covered the Macquarie Banking Symposium 2025 held last week by Macquarie Group Ltd (ASX: MQG).
The event considered critical themes shaping the future of banking.
Following the event, the broker released a research note titled '2025 Banking Symposium – reap what you sow'. It summarised three themes discussed at the event.
Two of these concerned business and consumer banking trends, and the third considered how AI and technology could shape the future of banking.
Macquarie acknowledged that banks had previously struggled to modernise their core systems due to a lack of prioritisation, focus, and leadership. However, if used properly, AI could be a major opportunity to drive cost efficiencies.
And some banks have been doing it a lot better than others.
As stated yesterday, Commonwealth Bank of Australia (ASX: CBA) has shown the greatest initiative so far in using AI to drive cost efficiencies.
CommBank's migration to Amazon Web Services (AWS) seeks to help the bank "drive faster, more personalised and innovative customer and employee experiences using the latest data, AI and analytics technologies".
CBA relies on AI to cut its workforce
Yesterday, the Australian Financial Review published an article that explored other ways in which CBA is using AI to deliver cost efficiencies.
According to that report, CBA has cut dozens of jobs in its customer call centres. The deployment of AI was cited as the reason behind this move.
Specifically, 45 roles have been made redundant, with a new chatbot fulfilling the duties covered by those employees. While this is just a fraction of the 38,000 positions at CBA, it marks the first time the bank has directly linked job cuts to AI. This may be a further sign of things to come.
CBA revealed that the "voice bot" had reduced the volume of calls by 2,000 per week. CBA considers this an opportunity to upskill its team to manage more complex enquiries.
While potentially not great for CBA employees who have lost their jobs, this is likely to make CBA more profitable, which is a win for shareholders.
Foolish Takeaway
The big 4 banks are fiercely competitive, with each bank constantly looking for ways to improve profitability. CBA appears to be leading the way in using AI to achieve this goal.
As reported by the Australian Financial Review in May, Westpac Banking Corp (ASX: WBC) is currently making 1,500 employees redundant to meet ambitious cost reduction targets. However, this has not been attributed to AI productivity.
While banking might not be the first sector that comes to mind when investors consider the potential application of AI, it's already transforming the banking workforce.
