More than 90% of the executives across Europe’s financial services sector say that up to 10% of roles could become redundant over the next year – EY survey

Leaders across Europe’s financial services sector continue to integrate Artificial Intelligence (AI) and Generative AI (GenAI) technologies into their operations to achieve productivity and efficiency uplifts, according to the second EY European Financial Services AI Survey, but only 9% rank themselves ahead of the curve. „Whilst leaders’ aspirations for a more AI-enabled business are high and 28% say they have accelerated overall AI adoption over the last year, most firms remain in the early, experimental stages, especially when it comes to GenAI.” – according to the press release.  

The new survey data, which canvassed the views of European financial services executives at over 100 firms representing an aggregate market cap of almost €880bn, finds that only 31% of firms across Europe believe they are on track with overall AI integration. Just 11% of executives say their firm is prepared for incoming AI regulation, and despite 78% acknowledging their workforce has only some, limited or no experience of the newest GenAI-related technologies, only a quarter of firms have established new training and upskilling programmes, with 60% still in the planning phase.

Omar Ali – EY Global Financial Services Leader, comments: “GenAI continues to sit high on the agenda for financial services leadership teams, promising well-acknowledged new levels of productivity gain. There is little doubt within the sector that harnessing AI – and increasingly GenAI – is game-changing, but the implementation of an evolving technology, to budget, within risk appetite and across an entire workforce, is hugely complex and challenging. Whilst some firms have made huge leaps in adopting AI and have seen real benefits, many are struggling to keep pace. 

“GenAI is developing faster than many other technological innovations of recent times, and demands new, progressive skill sets. The firms that ramp up regulatory preparations, build an appropriate risk and control framework, and roll out essential new training and upskilling programmes across their whole workforce – not just to the technical few – will be setting themselves apart from the competition.” 

AI could impact up to a third of Europe’s finance roles – especially at entry-level

The majority (66%) of executives surveyed believe that over the next year up to a quarter (25%) of current European financial services roles could be impacted by ongoing AI integration, and 93% of executives say up to 10% of roles could become redundant. Despite this, only a quarter (25%) report their firm has an established training programme in place, 43% say plans are still in their infancy, and 29% confirm they currently have no training programmes in place – 12% of whom say they have no plans to develop one.

Entry level positions are expected to be particularly impacted, with 59% of leaders believing AI technologies will have a significant or even transformative impact on the roles and tasks undertaken by those joining the workforce. Despite this, only 24% of executives are planning to restructure entry-level roles and responsibilities, and just 25% plan to integrate AI training within their graduate programme (down from 35% in 2023). Thirty-five per cent say they have not taken any action to offset any potential knock-on impacts of AI adoption to the junior workforce (up from 28% in 2023). 

Business areas demanding AI expertise and attributes leaders look for in new hires

For the second year running, the business area that has the highest demand for AI talent is data science and innovation (the top choice for 54% of respondents). The second and third ranking areas have switched places this year, and second in 2024 is back-office operations (46% of respondents, up from 14% in 2023), followed by information technology (40% of respondents in 2024, up from 24% in 2023).

When asked to consider the top attributes that firms will seek as they recruit entry level talent for an AI-enabled workforce, the top three cited by European financial services leaders were the ability to adapt and flex (77%), having an innovative and experimental mindset (70%), and the ability to collaborate and work outside their focus area (44%). This year, being tech savvy did not rank as a top priority (34%). 

European finance leaders plan to increase capital allocation to GenAI specifically

The survey data confirms that GenAI driven investment remains central to European financial firms, with 72% of executives planning to increase expenditure over the next six to 12 months. This is marginally lower than the 75% of leaders in 2023 who said they would actively invest in GenAI in the year ahead.

GenAI knowledge, future regulation, and keeping pace are leaders’ top concerns

Focusing on GenAI specifically, the two biggest concerns according to the surveyedexecutives when it comes to integrating the technology remain the same as last year. European finance leaders cite limited understanding and experience of GenAI applications and the impact across the workforce (56% in 2024, up from 36% in 2023), followed by uncertainty about existing and pending potential regulatory impacts (38% in 2024, up from 29% in 2023). Ethical issues – which were ranked third in 2023 have fallen to eighth place, and leaders are now more concerned about the speed of evolution of GenAI progress compared to how fast they can integrate it into their business (35%), followed by cost of implementation and control frameworks (26%). 

In reference to the broader AI landscape, only 11% of surveyedleaders stated that their firm is fully prepared for incoming regulation, while 70% say their firm is only limited or partially prepared, and 15% do not even have an AI regulatory risk framework in place.

Ethics in GenAI integration

On GenAI specifically, surveyedleaders continue to raise concerns about ethics. The top concern in 2024 for GenAI adoption is the quality of output (cited by 56% of all respondents), followed by transparency and explainability (54%), privacy (53%), and the potential for discrimination, bias, and lack of fairness (47%). To manage potential ethical implications arising from GenAI integration, 14% of respondents claimed they have already put an overall AI ethics framework in place, with a further 31% in the early stages of development. However, a quarter (25%) of respondents stated their firm is yet to develop an AI ethics framework, and 24% said they have no plans to develop one. 

Ayman Awada, EY EMEIA Financial Services Banking Technology and GenAI Leader, comments: “GenAI technologies are moving the goalposts of what is possible for financial services firms when it comes to operations and back-office processes. There is a small segment of the market that sits ahead of the curve by scaling AI capabilities at pace, but many firms are barely progressing from early-stage adoption and predominantly focus on the back-office. Despite investment, moving beyond the experimental stage has been slower than expected for Europe’s financial firms, and the benefits are often siloed within departments. 

“Many banks, insurers and asset managers across Europe still have some way to go to reach the next level of AI-enablement. Raising the bar on regulatory readiness, and upskilling new and current staff to embrace GenAI now and in the future will be the key to unlocking deeper adoption.” 

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The EY 2024 European Financial Services AI Survey canvassed the views of 116 financial services executives (at 106 private and listed firms, representing an aggregate market cap of almost €880bn) across Europe in October 2024 to assess the potential impacts of AI and Gen AI integration on productivity, talent, skills, capital allocation, and risk management.