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Swiss Bank Replaces Seven Employees With Five Robots

Courtesy of ZeroHedge. View original post here.

A Swiss bank has replaced seven employees with five software robots in order to speed up workflow, according to Bloomberg.

In a pilot project, St. Galler Kantonalbank AG opted for the second option. The bank is so satisfied with the test results that it wants to decide on further assignments by the end of May. -Bloomberg

When St. Galler Kantonalbank (SGKB) needed to transfer around 5,000 securities positions into its own IT systems during the acquisition of M.M. Warburg Bank Schweiz AG’s private banking business, the five robots were put on the job, and “did their job well,” according to SGKB. Now they’re exploring other applications for digital employees.

We’ve seen that’s technically feasible and now we’re exploring whether other applications are worthwhile, and I’m very optimistic about that“, Felix Buschor, member of the management board, said in an interview with Bloomberg. “The assessment of the potential is in full swing.”

Buschor admits some of their human employees are beginning to worry about their jobs – though he offers up a Jedi mind trick of sorts to reassure them that ”as we have always compensated efficiency gains through natural fluctuation and because we paid close attention to enabling our employees to develop new technologies, the acceptance is high,” whatever that means.

More banks?

According to Christian Voigt, managing director of Nuremberg-based IT consultant Roboyo GmbH which worked with the Swiss bank, St. Galler Kantonalbank isn’t the only one looking to send human bank employees to the unemployment line. 

In the financial sector, the automation of processes is currently a huge topic, and we work with banks, insurers and leasing companies,” said Voigt.

He attributes the banks’ strong interest to time savings and cost reductions. For example, thanks to the use of robots, it is possible to forgo costly and expensive software interfaces for the communication between two systems, he said. “Sometimes, seven-digit amounts of money are needed for such an interface.” -Bloomberg

Last November, former Deutsche Bank CEO John Cryan said that AI technology will help Germany’s largest bank cut tens of thousands of jobs.

Deutsche has made about 4,000 of the 9,000 job cuts promised under a five-year restructuring plan announced in late 2015. Mr Cryan said many of the additional cuts would come through using technology to boost efficiency in the bank’s processes.

“There we’ve got the most to gain,” he said. “We’re too manual, which can make you error-prone and it makes you inefficient. There’s a lot of machine learning and mechanisation that we can do. -Financial Times

When asked about the specific number of employees at risk of being replaced, he told Laura Noonan at the Financial Times it would be a “big number.”

SGKB’s robot bankers are estimated by Buschor to cost between 20,000 and 30,000 Swiss francs (currently trading in parity with the USD) – vs. a banker which can cost much more than that, every year.

A study by GFT Technologies SE carried out at the end of 2017 showed that technologies and artificial intelligence have the potential to revolutionize the financial sector. The survey involved 285 professionals from small to large retail banks in eight countries, including Germany, who were interviewed by phone in collaboration with market researcher Frost & Sullivan. Around 94 percent of all participants of major banking institutions saw direct added value in artificial intelligence solutions. -Bloomberg

According to Isaac Asimov’s “Three Laws of Robotics,” our robo-slaves may not injure a human being, or through inaction, allow a human being to come to harm. You’ll note there’s nothing in there about robot bankers sending humans into poverty, or stealing customer deposits and going to the robot strip club… however they’ll most certainly require physical bodies before the latter happens.

You have been warned. 


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