Europe’s banking sector is poised for a harsh lesson in efficiency. According to a new Morgan Stanley analysis reported by the Financial Times, more than 200,000 European banking jobs could disappear by 2030 as lenders embrace artificial intelligence and close physical branches. This represents roughly ten percent of the workforce at thirty-five major banks.
The deepest cuts are expected in back-office operations, risk management, and compliance. These are the unglamorous core functions of banking where algorithms are seen as capable of processing data far faster and more effectively than human employees. Banks are anticipating potential efficiency gains of thirty percent from this shift, as noted in the report.
This trend of downsizing is not limited to Europe. Goldman Sachs warned its U.S. employees in October of impending job cuts and a hiring freeze through the end of 2025. This is part of a broader AI initiative targeting everything from client onboarding to regulatory reporting.
Some institutions are already taking action. Dutch lender ABN Amro plans to reduce its staff by a fifth before 2028, while the CEO of Société Générale has stated that “nothing is sacred.” However, some European banking leaders are urging a more cautious approach. A JPMorgan Chase executive noted that if junior bankers never learn the fundamental skills of the trade, it could create serious problems for the industry in the future.