Wall Street has another reason to warmly embrace artificial intelligence (AI). Not only is it expected to be a boom for financial markets, but it is helping some of the industry’s biggest players boost internal business and satisfy high-end customers.
JPMorgan Chase & Co., Goldman Sachs Group Inc., and Morgan Stanley are increasingly bullish on the possibilities of AI
During April’s stock market bloodletting, for example, JPMorgan Chase’s AI tools fielded dozens of requests from skittish clients while managing to increase sales to wealthy customers because of the speed with which AI tools let bankers provide research and investment advice, the bank’s CEO of asset and wealth management told Reuters.
“In the last few weeks, there have been several fluctuations in the market which are not in normal bite sizes, making it very complicated to think about all your clients and all the things required to do,” Mary Erdoes, JPMorgan’s CEO of asset and wealth management, said.
JPMorgan’s foray is being mirrored by other major banks — many of whom have taken note of that bank’s savings of almost $1.5 billion through fraud prevention, personalization, trading, operational efficiencies, and credit decisions. The Harvard Business School calculated that figure based on a case study on the potential of GenAI used by 4,000 advisers serving JPMorgan’s high-net-worth private bank clients.
In January, Goldman Sachs hired Daniel Marcu, who was vice president of artificial general intelligence, web & knowledge services, at Amazon.com Inc., to lead its artificial intelligence engineering and science team in the creation of AI intelligence platforms and products. The bank is also rolling out a Generative AI assistant to its bankers, traders, and asset managers.
Meanwhile, a chatbot developed with OpenAI is available to wealthy clients of Morgan Stanley to pour over investment strategy.
But it is JPMorgan that is blazing the most formidable trail with AI.
With a technology budget of $17 billion in 2024, the New York-based bank already has some 450 potential applications for AI, and CEO Jamie Dimon expects those applications to more than double to 1,000 by 2026.
To that end, gross sales for JPMorgan Asset & Wealth Management increased 20% between 2023 and 2024 with GenAI-driven tools helping teams focus more effectively on high-impact client work.
Leading the charge is JPMorgan’s GenAI toolkit that is used by more than 200,000 employees, or roughly two-thirds of the bank’s worldwide workforce. More than half of the GenAI toolkit users deploy it several times daily, according to JPMorgan.
Another essential tool is Coach AI, JPMorgan’s service for private client advisers. The app is expected to allow advisers to expand client rosters by 50% in the next three to five years, with AI handling some of the other research-related work. Portfolio managers in asset management are also using the AI tools.
