In a major AI push, Singapore’s DBS Bank plans to lay off around 4,000 people in the next three years as artificial intelligence tools and solutions will take over the work that is currently carried out by humans.
The regional banking giant confirmed it is currently testing and trialling a host of AI-powered software systems and platforms, a spokesman in Singapore confirmed when contacted by QA Financial.
The digital upgrade will gradually be rolled out, with the decrease in staff numbers coming from “natural attrition” as new AI-powered tools and platforms will be deployed one by one.
“Over the next three years, we envisage that AI could reduce the need to renew about 4,000 temporary and contract staff across our 19 markets working on specific projects,” the DBS spokesman in Singapore shared.
“As such, we expect the reduction in workforce will come from natural attrition as roles are completed over the next few years,” he clarified.
The spokesman was keen to stress that the changes will mainly affect around 9,000 temporary and contract staff currently working for the bank. At present, DBS has a total workforce of around 41,000 people in 19 countries, mostly across Asia.
While thousands of jobs are expected to go, the bank did point out that the further integration of AI technology does mean around 1,000 new, related jobs are expected to be created.
Last year, DBS disclosed it had, at the end of 2024, deployed around 800 AI models across 350 use cases, and expected the measured economic impact of these to exceed S$1 billion before the end of 2025.
The announcement comes as current deputy chief executive Tan Su Shan is preparing to take the top job next month.
The tech push is remarkable as it makes DBS one of the first major banks globally that has set out specific plans on how and when AI may effect its operations in such detail.
Many other banks, most notably in the U.S., may have indicated AI is coming in fast, with junior roles likely to be replaced by the relatively young technology, but detailed plans and specific strategies have hardly been presented, so far.
AI investments
DBS’ latest announcement fits into a wider trend within Singapore’s financial services space to embrace AI technology, largely encouraged by the Monetary Authority of Singapore (MAS), the micro-state’s financial services watchdog.
At the end of last year, MAS announced to commit S$100 million, or close to $75m, to support the island-state’s banks and other financial services firms to design, test and build capabilities in artificial intelligence technologies.
The capital was meant to speed up the advancement of AI related innovation and adoption in financial services, MAS said.
“While financial institutions have been progressively adopting AI, recent technological advancements have made such tools more widely accessible and increased the pace of adoption,” the body explained at the time of the announcement.
“AI-readiness and adoption varies hugely across financial institutions in Singapore.”
– MAS
With the advent of Generative AI, financial institutions have embarked on initiatives to map the technology’s opportunities and risks, and have begun piloting it across a range of use cases, it stressed.
“Nevertheless, the level of AI-readiness and adoption varies hugely across financial institutions in Singapore,” the regulator warned.
“MAS will therefore bolster financial institutions’ development and deployment of AI technologies in Singapore,” it said.
The watchdog firmly believes that Singapore has “the potential to become a centre of excellence for anchoring AI capabilities, such as in the development of applications, as well as testing and deployment of AI solutions for the financial sector.”
MAS will support financial institutions in establishing AI innovation centres in Singapore for a range of functions including AI model building and training, deployment of AI models for high-impact use cases, governance and risk management, as well as testing and monitoring.
It also plans to develop AI platforms to address industry wide use cases.
“There are strong prospects for the financial industry to apply AI to solve industry-wide problems beyond what each financial institution can do individually,” MAS clarified.
This involves the development of frameworks and platforms for policies and protocols that enable secure and privacy protected data exchange where financial institutions can collaborate on industry-wide use cases, the regulator concluded.
Banking coalition
The latest announcements come amid a range of measures by MAS to increase software resilience and testing efforts in the country’s dominant financial services space.
At the end of 2024, MAS teamed up DBS, as well as with HSBC, OCBC and UOB, to develop and roll out quantum security capabilities in Singapore.
The regulator said a memorandum of understanding, which the different entities have signed, includes plans to study and test the application of quantum key distribution in the micro-state’s financial services sector via a range of sandbox projects.
Network provider SPTel and SpeQtral, a spin-out company from the Centre for Quantum technologies in Singapore, have also come onboard as part of the sector-wide digital resilience push, confirmed Vincent Loy, assistant managing director for technology at MAS.
“As quantum technology advances, it is vital for the financial sector to safeguard against potential cybersecurity threats that may be brought about by the technology,” stressed Loy.
“This will help MAS and financial institutions better understand QKD’s potential impact on operations and address challenges early,” he added.
One of the primary goals of the collaboration is to develop secure communications by deploying fiber quantum key distribution and roll out space-based quantum communications technologies.
“Quantum key distribution can help financial institutions (protect the exchange of cryptographic keys to address the cybersecurity threats posed by quantum computing,” Loy clarified.
Meanwhile, Eugene Huang, group chief information officer at DBS, explained his banks decision to take part and support the memorandum of understanding.
“While DBS has been familiarising ourselves with quantum computing’s potential to transform financial services, we are keenly aware of the dangers this fast-developing technology can bring,” Huang said.
“This MoU represents a significant step forward in safeguarding Singapore’s financial sector against looming cybersecurity risks associated with quantum,” he added.
Moreover, “by participating in the development of QKD use cases, we are not only enhancing our defences but also setting new standards for futureproofing our financial systems against bad actors seeking to exploit encryption technology,” Huang shared.
MAS, DBS and the other entities involved will focus on a range of areas including conducting a QKD proof-of-concept sandbox on financial sector use cases to evaluate its viability, effectiveness and applicability to financial services, and determine the feasibility of using QKD for quantum-safe communications within the financial sector.
Moreover, they will test the validity of the security properties of QKD, such as detecting eavesdropping attempts and preventing unauthorised access or tampering of QKD transmissions.
“This will help to verify QKD’s capability to provide robust security for sensitive data transfers, and enhance trust in its deployment within the sector,” MAS pointed out.
In recent years, quantum computing technology has been developing rapidly and has demonstrated the potential to break commonly used cryptography and encryption algorithms, which is increasingly posing a major cybersecurity concern for banks and other financial services firms.
In February 2024, MAS issued an advisory to the country’s finance sector on the cybersecurity risks associated with quantum technology.
The financial services watchdog went on to provide recommendations for banks and finance firms to safeguard themselves against the identified threats, including to carry out proof-of concept trials with quantum security solutions.
More recently, MAS launched a quantum track under its relatively new Financial Sector Technology and Innovation Grant Scheme to provide funding support for quantum projects and capabilities.
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