Major Banks Accelerate Mass Layoffs, AI the Main Culprit

Jakarta, CNBC Indonesia - Economic pressures are impacting nearly all industrial sectors, with declining corporate performance spilling over into the world of work and triggering a wave of layoffs. Companies are increasingly seeking alternatives to replace labour as part of efficiency drives, with the presence of artificial intelligence (AI) being touted as the solution.

Global banking giant Standard Chartered has announced plans to cut more than 7,000 employees deemed to fall into the ‘low-value human resources’ category over the next four years amid the massive adoption of AI. The London-based bank stated that AI technology will be the main driver of operational efficiency to boost profitability and face increasingly fierce competition in the financial industry, as reported by Reuters on Wednesday (20/5/2026).

Standard Chartered said it will cut around 15% of positions in corporate functions by 2030. Based on Reuters calculations, this step equates to more than 7,000 layoffs from a total of approximately 52,000 employees in that division. CEO Bill Winters stressed that this move is not merely about cost savings, but about replacing low-value human resources with investment in technology and financial capital. “This is not just cost cutting. In some cases, we are replacing low-value human capital with financial capital and investment capital that we deploy,” Winters said.

Globally, Standard Chartered has nearly 82,000 employees. Winters said the workforce reduction will be carried out through automation and AI implementation, although some employees will also be given reskilling or retraining opportunities. “People who want to upskill and continue their careers will be given the chance to reposition,” he said. The most affected positions reportedly come from the bank’s back-office operational centres, including in Chennai, Bengaluru, Kuala Lumpur, and Warsaw. Winters said AI will be the main facilitator in the transformation of the company’s core banking systems.

Standard Chartered’s efficiency drive comes as more global companies cut jobs to improve efficiency through AI. Japanese bank Mizuho Financial Group previously also announced plans to reduce up to 5,000 jobs over a decade. Meanwhile, global banks are now racing to integrate the latest AI models while facing increasing cyber threats.

Despite the large-scale layoffs, Standard Chartered is still setting aggressive growth targets. The bank is targeting a return on tangible equity (ROTE) above 15% by 2028, rising to around 18% by 2030. The company is also accelerating its target for net new money inflows of US$200 billion to 2028, earlier than the previous 2029 target. Business focus will be directed towards higher-margin segments, including wealthy retail customers and financial institutions.

However, geopolitical challenges still loom over the global banking industry’s prospects. Standard Chartered, which focuses on the Asia Pacific and Africa region, acknowledged the Middle East conflict as one of the main risks. In the first quarter of this year, the bank set aside a prudential provision of US$190 million related to the conflict in the Middle East. “We are very resilient,” Winters said when asked about the impact of geopolitical and market risks on the bank’s ability to achieve its business targets.