HSBC is deploying AI to drive efficiency as it focuses on developing cyber resilience and restructures its operations. 

The London-based bank aims to decommission or re-engineer nearly 50% of its legacy apps and infrastructure to mesh with new tech, including AI, by 2028. The work will help HSBC run operations more efficiently, Chief Executive Georges Elhedery said during today’s second quarter earnings call. 

“We continue to work on around 50 processes and procedures to achieve substantial simplification,” Elhedery said. “This is where we are putting our AI to work to simplify, strengthen and accelerate the bank, empower our colleagues and personalize our service to customers.” 

Applications of AI within the bank include: 

• Delivering personalized wealth management support; 

• Strengthening financial crime risk management; and 

• Expanding AI-powered tools for frontline employees. 

The bank aims to have more than 200 AI applications in the next two years and is working with Google Cloud for some of its AI needs, according to FinAi News’ prior reporting.  

By deploying AI and simplifying its operations, HSBC aims to save $2 billion, Elhedery said.  

“We originally set out to deliver $1.5 billion of annualized saves. We have now exceeded this target, reaching $1.7 billion of actioned saves,” he said. “We are creating the capacity to continue investing for growth, including in talent, technology and AI.” 

Cyber resilience 

As the $2 trillion bank continues to deploy AI, it is also remains wary of the challenges. 

The bank is seeing an increased risk of service disruption or data loss arising from technology failures or malicious activity by internal or external threat actors primarily driven by AI, according to its earnings report. 

“This is driven by a rapidly evolving external threat environment where AI is enabling cyber activity to become faster and more scalable across both direct and third-party channels,” the bank wrote in its earnings report. 

To mitigate AI cybersecurity risk, HSBC is developing cyber-resilient operations and working closely with its tech providers to bolster security, it said. 

“We assess our third parties to help ensure they deliver the service standards required to maintain operational resilience,” according to the earnings report. 

BY THE NUMBERS: In Q2, the bank reported: 

• Revenue of 19 billion, up 7% year over year; 

• Profit or net revenue of $10.1 billion, up 63% YoY; and 

• Headcount of 206,161, down 2.3% YoY. 

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