Offbeat Citi issues stark warning on automation of bank jobs

00:55  12 june  2018
00:55  12 june  2018 Source:   ft.com

Can the 3.8% unemployment rate tumble toward zero?

  Can the 3.8% unemployment rate tumble toward zero? The unemployment rate fell to an 18-year low of 3.8% in May. It can probably slide some more. But to what?Load Error

Alastair Darling issued the warning today. Citi ’s chief executive, Charles “Chuck” Prince, said his resignation “was the only honourable course” after the bank racked up billions in losses and write-downs from exposure to high-risk mortgage debts.

Primary Location: India,Maharashtra,Pune. Education: Bachelor's Degree. Job Function: Bus Strategy, Planning & Admin. AVP (C12) Smart Automation Centre. Location: Pune, India. The Services Strategy: 2020 is an integral part Citi ’s Operations & Technology (O&T) Strategy and aims to

Shift in resources: operational roles, such as the 20,000 at Citi, face elimination as banks embrace machine labour: Pedestrians cross a footbridge towards the Canary Wharf business, financial and shopping district in London, U.K., on Thursday, June 5, 2018. The owners of a Canary Wharf skyscraper leased to Citigroup Inc. are seeking to refinance the 661 million-pound ($882 million) loan used to buy it five years ago, two people with knowledge of the plan said. Photographer: Chris Ratcliffe/Bloomberg © Bloomberg Pedestrians cross a footbridge towards the Canary Wharf business, financial and shopping district in London, U.K., on Thursday, June 5, 2018. The owners of a Canary Wharf skyscraper leased to Citigroup Inc. are seeking to refinance the 661 million-pound ($882 million) loan used to buy it five years ago, two people with knowledge of the plan said. Photographer: Chris Ratcliffe/Bloomberg Citigroup’s investment bank will shed up to half of its 20,000 technology and operations staff in the next five years, according to the division’s head, as machines supplant humans at a faster pace.

The prediction by Jamie Forese, president of Citi and chief executive of the bank’s institutional clients group, was the starkest among investment banking bosses in a series of FT interviews to mark the 10th anniversary of the financial crisis.

Australia's largest bank to pay $531 million compliance fine

  Australia's largest bank to pay $531 million compliance fine The Commonwealth Bank of Australia has agreed to pay a $531 million fine for failing to comply with measures to prevent money laundering and terrorism financing. The bank negotiated the fine with the Australian Transaction Reports and Analysis Center, the government's financial intelligence agency better known as AUSTRAC, to resolve a civil Federal Court case that began in August. The agreement is subject to court approval.

As much as 80% of retail jobs at risk from automation , Citi and University of Oxford predict. Low-skilled jobs most at risk and will have profound effects on communities. 'Watershed' moment coming for retail jobs , Citi and Oxford warn .

Banks . Automation Could Kill 30% of Bank Jobs . Andrew Harrer—Bloomberg/Getty Images. Now, according to a new report from Citibank analysts, there’s a target painted on a new group’s back: bank workers.

Mr Forese said the operational positions, which make up almost two-fifths of investment bank employees at Citi, were “most fertile for machine processing”.

“We’ve got 20,000 operational roles. Over the next five years could you make it 10,000?” he added, in comments that had echoes of former Deutsche Bank chief executive John Cryan’s claim that up to half of the German bank’s workforce could be replaced by technology.

If replicated across the industry, the potential job losses would represent a steeper rate of cuts than in 2007-2017, when almost 60,000 jobs were cut from eight of the world’s top 10 investment banks, according to FT research. Two of the top 10 investment banks were not included in the FT research; Citi, because its data were not available; and Bank of America because its 2008 merger with Merrill Lynch make pre-crisis comparisons futile.

Milestone for US job market: More openings than unemployed

  Milestone for US job market: More openings than unemployed <p>For the first time on record, the number of job openings in the United States exceeds the number of unemployed Americans, a trend that might soon give workers more leverage for pay raises.</p>Load Error

Artificial intelligence (AI) and banking automation are already beginning to take over banking jobs . While it may sound farfetched right now, banking industry insiders are already coming out in support of Musk’s idea, with their own warnings on possible job losses.

The downsizing of the bank workforce is about to accelerate as more technology takes over jobs humans used to do, according to a new Citigroup report. Another 30% of bank jobs could be lost between 2015 and 2025, mainly due to retail banking automation , Citi warned .

Barclays investment bank boss Tim Throsby said that the future would see a smaller number of employees making more money, while machines took over “lower-value tasks”.

“If your job involves a lot of keyboard hitting then you’re less likely to have a happy future,” he added.

Richard Gnodde, head of Goldman Sachs International, said: “There are so many functions today that technology has already replaced and I don’t see why that journey should end any time soon.”

Not every investment bank boss saw plenty of room for more cuts. At HSBC, Samir Assaf, head of global banking and markets, said there was “not much more to go” for technology replacing investment bank staff.

“We get to a point from a risk-management perspective [where you can’t cut much more]. I think there is maybe another 5 to 10 per cent to go between now and the next five years.”

Mr Gnodde stressed that technology could create new business opportunities and ultimately new jobs, such as Goldman’s fledgling online only consumer bank Marcus.

Mr Forese said his bank would hire in other areas such as sales and research. “What people are doing, the type of work being done by the human rather than the machine will change,” he added.

Poll: immigration has become the No. 1 issue for voters in 2018 .
A new Pew poll finds immigration has overtaken health care and the economy as a top 2018 issue. Democrats have been hammering home two issues in particular ahead of the 2018 midterms: jobs and health care.But between the recent outrage over the Trump administration’s family separation policy and House Republicans taking up a comprehensive bill aimed at fixing the Deferred Action for Childhood Arrivals program, one new poll finds that voters thinking about 2018 care most aboutimmigration.

Source: http://us.pressfrom.com/news/offbeat/-154015-citi-issues-stark-warning-on-automation-of-bank-jobs/

—   Share news in the SOC. Networks

Topical videos:

This is interesting!