AI disruption leads HK regulators to urge banks to prepare
Introduction
In a recent inSight publication*, the Hong Kong Monetary Authority (HKMA) highlighted the significant disruption AI is expected to have on banking services, operations, and manpower management in the coming years. The regulators called for rapid strategic planning and robust staff training to ensure that the workforce can thrive alongside technological advancements. To support this, the authority has also released an updated module of its Supervisory Policy Manual on capacity building.
Key HKMA-derived insights related to AI disruption
- Workforce evolution: AI is challenging and reshaping traditional roles in Financial Services as well as creating new ones.
- Job displacement concerns: There are clear concerns about AI displacing certain jobs, requiring careful planning and management.
- Future skills and roadmap: Identifying / addressing skill gaps and planning transitional role adaptation is crucial for future growth.
- Manpower development: Enhancing professional knowledge and skills is vital for financial employees to coexist with AI and leverage it effectively.
- Training investments: Banks need to allocate resources for staff training to support changing business priorities and thrive in the disruption phase.
AI: Both the problem and the solution
Beyond the HKMA insights, AI presents both opportunities and challenges for banking Executives. In particular, the critical manpower challenges can be partially solved by AI itself. Indeed, various strategic planning and workforce adaptation activities can be facilitated or even enabled by the technology that created these requirements in the first place.
AI-powered recommendations for financial leaders
1️. Market intelligence: Use AI to monitor, analyse, and understand market trends and AI implications on the workforce.
2️. Predictive analytics for workforce planning: Apply predictive analytics to forecast future role transitions, skill requirements, and workforce changes.
3️. Talent acquisition tools: Leverage AI for gap identification, role modelling, talent acquisition / management, ensuring the right skills are onboarded to meet future demands.
4️. AI-driven training programmes: Implement AI-powered platforms for continuous learning and skill development tailored to evolving industry needs.
5️. Staff performance: Rely on AI tools and data analytics for performance monitoring, appraisal, and ongoing improvement.
Conclusions
By proactively embracing AI tools and methodologies, financial companies can enhance efficiency, security, and customer experience while supporting their workforce through the ongoing transition, thereby minimising disruption risks. Forward-thinking leaders can ensure their institutions not only adapt but also become more competitive and successful in the AI era.
* Manpower management in the age of Artificial Intelligence, InSight HKMA, May 2024
