Who Are the AI Goliaths in the Banking Industry? A New Index Reveals a Growing Divide
The latest Evident AI Index paints a picture of a banking sector in flux, with AI adoption accelerating at an unprecedented pace. While North American giants like JPMorgan Chase and Capital One continue to lead the pack, challengers from Europe and Asia are closing the gap. The report reveals a widening divide between AI "haves" and "have-nots," with top banks improving at twice the rate of their peers. As the industry grapples with talent wars, innovation races, and the pressure to demonstrate ROI, one thing is clear: in the world of modern banking, AI proficiency is no longer a luxury — it's a necessity for survival.
By Garret Reich, Editorial Operations Manager
The report: AI Index for Banks
Source: Evident
Executive Summary
In a year marked by unprecedented advancements in artificial intelligence, the banking sector is experiencing a seismic shift in AI adoption and maturity. The latest Evident AI Index, released in October 2024, paints a picture of an industry racing to harness the power of AI, with some clear leaders emerging and others at risk of falling behind.
The 2024 Index, which evaluates 50 major banks across four key pillars — Talent, Innovation, Leadership, and Transparency — shows a dramatic acceleration in AI initiatives. However, it also highlights a growing divide between the AI "haves" and "have-nots" in the banking world.
Key Takeaways:
- 41 out of 50 banks improved their scores year-on-year, with the average score increasing by 8%.
- Top 10 banks are improving their scores at twice the rate of the average bank, widening the gap between leaders and laggards.
- U.S. and Canadian banks continue to lead the pack, occupying 7 of the top 10 positions in the rankings.
- Banks are making significant strides in "Leadership and Transparency", with scores in these pillars increasing by 23-27% on average.
- 26 banks are now reporting outcomes from AI use cases, though only 6 are disclosing financial impacts.
Why we liked the report: There is plenty of generic reports that exist out there on artificial intelligence integrations in banking, but very few dive deeper into what individual financial institutions are doing in the ways of AI and the obstacles they encounter.
Why we didn’t: Obviously, the megabanks can make for strong case studies of AI investments. However, the report notably lacks the views of smaller financial institutions that could be making substantial, or creative, investments in artificial intelligence.
Who’s Leading the AI Banking Landscape?
JPMorgan Chase retained its position at the top of the Evident AI Index for the third consecutive year, showcasing consistent leadership across all four pillars of the methodology. The bank’s commitment to AI is evident in its substantial AI talent pool, which represents 8.5% of all AI talent across the 50 banks surveyed. JPMorgan Chase’s dominance extends beyond talent, as it leads in AI research output, representing 35% of all AI researchers affiliated with Index banks.
Capital One and Royal Bank of Canada rounded out the top three, with Capital One making significant gains in the Talent pillar. The bank’s strategy of growing its AI workforce faster than its peers is paying off, particularly in terms of AI talent density relative to overall headcount. Capital One’s success in this area is attributed to its early adoption of cloud infrastructure, having completed migration to Amazon Web Services by 2020.
Royal Bank of Canada, while ranking third overall, shows particular strength in Innovation. The bank excels in AI-specific research citations, patent citations, and participation in academic conferences, underscoring a quality-over-quantity approach that bolsters its outsized influence in the field.
Regionally, North American banks continue to dominate the rankings, but there are signs of change. CommBank from Australia broke into the top 5, while HSBC made a significant leap to claim the 7th spot, becoming the first UK bank to crack the top 10. This shift indicates that banks from other regions are beginning to close the gap with their North American counterparts.
The Talent Wars: An All-Out Battle for AI Expertise
The competition for AI talent remains fierce, with the Index identifying over 70,000 AI-related roles across the 50 banks, a 17% increase from the previous year. This growth is particularly pronounced in AI-specific Software Implementation roles, which saw a 37% increase, reflecting the need for talent to adapt and scale AI use cases across enterprises.
U.S. banks continue to lead in talent acquisition, with the three largest U.S. players (Wells Fargo, JPMorgan Chase, and Capital One) representing 17.5% of the current AI Development talent pool. However, European institutions are investing heavily in talent development programs to close the gap. Notable examples include BBVA’s Data University, which has trained 50,000 employees in data and AI skills, and BNP Paribas’ AI Summer School, which attracts over 2,000 employees annually.
The report also highlights a growing focus on Responsible AI (RAI) talent, which saw a 41% increase year-over-year. UK banks were the biggest contributors to this trend, with HSBC, Lloyds Banking Group, and NatWest driving more than a quarter of net new talent profiles in this space.
In terms of innovation, nine banks retained their top-10 status, indicating the stability of long-term investments in AI research, patents, and partnerships. JPMorgan Chase leads in research output, representing 38% of all AI research published by Index banks. The bank’s dominance is also reflected in the quality of its output, with a company-wide H-Index 6.5 times higher than the Index average.
Patent activity has seen significant growth, with 1,110 additional AI patents published since last year, representing a 44.7% increase. Capital One and Bank of America account for 60% of this interim growth, showcasing their commitment to protecting their AI innovations.
Venture activity focused on AI startups continues to be dominated by North American banks, representing 8 of the top 10 banks by deal flow over the past three years. However, European banks are increasing their activity, with HSBC entering the top 10 for the first time, driven by recent investments in AI startups.
Leadership and Transparency Mark New Battlegrounds
One of the most significant shifts in this year’s Index is the increased focus on transparency and responsible AI (RAI). The number of banks publishing RAI principles tripled from 6 to 18, indicating a growing recognition of the importance of ethical AI deployment in banking.
UK and Canadian banks are leading the charge in this area, with all Canadian banks now ranking in the top 20 for Transparency. This focus on "building trust" with customers through responsible AI practices could become a key differentiator in the coming years. Canadian banks, in particular, have made Responsible AI a cornerstone of their overarching strategy, even as innovation accelerates.
In the Leadership pillar, banks have significantly increased their AI-related communications. The 50 Index banks published over 1,250 references to "AI" across annual reports, press releases, and company LinkedIn posts—representing a 59% increase year-over-year. This increase in "volume" was accompanied by an increase in "substance," both across Investor Relations materials and in the engagement of Executive leaders across external media, industry conferences, and LinkedIn.
As AI investments mature, the pressure is mounting for banks to demonstrate tangible returns. While 26 banks are now reporting outcomes from AI use cases, only 6 are disclosing financial impacts, and just two (DBS and JPMorgan Chase) are attempting to estimate total realized dollar outcomes across all AI investments.
JPMorgan Chase, for instance, reported that the value they assign to their AI use cases is between $1 billion to $1.5 billion in fields such as customer personalization, trading, operational efficiencies, fraud detection, and credit decisioning. DBS, on the other hand, reported an economic value of SGD 370 million from its use of AI/ML in 2023, more than double the value from the previous year.
The coming year is likely to see an increased focus on quantifying AI’s impact on the bottom line, as banks seek to justify their substantial investments in this technology. The report suggests that as AI use cases move from pilot programs to wider team deployments, we can expect to see more concrete ROI figures and a clearer picture of how AI is transforming various aspects of banking operations.
Are There Regional Perspectives?
While North American banks continue to dominate the rankings, the report provides interesting insights into regional trends:
- United States: The U.S. demonstrates the biggest gap between the best and worst performers across all regions. Five U.S. banks rank among the top 10 in the overall Index, with particular strength in the Innovation pillar.
- Canada: All Canadian banks now rank in the top half of the Index, with notable strength in both the Innovation and Transparency pillars. The emergence of major AI hubs in Toronto and Montreal has contributed to this success.
- United Kingdom: HSBC’s entry into the top 10 marks a significant milestone for UK banks. The UK banks have shown particular strength in the Transparency pillar and have made significant improvements in the Leadership pillar over the last year.
- Asia-Pacific: While DBS fell out of the overall top 10 this year, CommBank broke into the top 5. The region shows strength in Leadership and Transparency pillars, with a growing focus on Talent Development.
- France: BNP Paribas remains the strongest contender from France, maintaining its position just outside the top 10. The bank’s partnership with Mistral AI signals a vote of confidence for Europe’s alternative to OpenAI.
- Rest of Europe: The continental European banks still trail behind the Index average, with German and Swiss banks leading the way in the region. The report suggests that weak scores among some European banks may be a harbinger of further industry consolidation.
Conclusion: The AI Revolution in Banking Accelerates
The report highlights several key trends that are likely to shape the future of AI in banking:
1. The growing importance of Responsible AI and transparency in building customer trust.
2. The need for banks to quantify and communicate the ROI of their AI investments.
3. The ongoing battle for AI talent and the increasing focus on internal talent development.
4. The potential for AI to drive significant improvements in efficiency, as evidenced by early ROI figures from leading banks.
5. The emergence of regional AI hubs and their impact on local banking sectors.
The Evident AI Index 2024 serves as a wake-up call for banks that have been slower to adopt AI, while providing a roadmap for success based on the strategies of leading institutions. As the financial sector continues to evolve, the ability to effectively leverage AI will increasingly become a key differentiator between successful and struggling banks.
Editor’s note: This article was prepared with AI language software and edited for clarity and accuracy by The Financial Brand editorial team.
