Technology
American Express will cut about 3,500 employees, nearly 4.5% of its global workforce, as part of a restructuring aimed at streamlining operations, boosting productivity, and accelerating decision-making. CEO Stephen Squeri said the move is necessary to become more agile and efficient amid intensifying competition from big banks and new entrants like Brex and Ramp, which are leveraging AI. The announcement came with third-quarter earnings, which showed net income up 28% to $3.71 billion and revenue up 9% to $20 billion. The company also highlighted AI opportunities for personalizing customer services.
At Money20/20, Citi's global head of AI, digital and data platforms, Naveed Anwar, said the bank is not rushing to let external AI agents connect to its systems. Citi has blocked agentic access beyond open banking read-only access, and Anwar emphasized the need for a 'know your agent' process to meet regulatory demands. Other banks like JPMorgan Chase, Bank of America, Morgan Stanley, Charles Schwab, and Fifth Third have also restricted AI agent access. Citi is focusing on enhancing client experience through AI in document processing and chat features, with 15 AI use cases live and about 60 more rolling out.
At the Evident AI Symposium, JPMorgan Chase CIO Lori Beer emphasized that security and risk management are central to the bank's accelerated AI use, including its LLM Suite platform supporting 1,000 business applications and used by 200,000 employees. Goldman Sachs CIO Marco Argenti highlighted the challenge of aligning AI agents with enterprise standards, noting that agents are stochastic and may misbehave. Both leaders stressed the need for robust controls, dynamic guardrails, and balancing risk with innovation. JPMorgan has shifted from counting use cases to 50 strategic initiatives to measure tangible business value. Goldman Sachs partnered with Anthropic to embed forward-deployed engineers, a model also adopted by Google, Microsoft, and AWS.
Speaking at Money20/20 in Las Vegas, Plaid co-founder and CEO Zach Perret said AI platforms like ChatGPT and Claude could become a monetization lever for financial services, starting with card issuance. He also discussed the impact of AI agents on banking and warned that AI-enabled fraud and agent swarms could make the coming year 'scary' from a security perspective, calling the Deloitte projection of $40 billion in U.S. fraud losses by next year a 'conservative estimate.'
The OCC issued its final rule to implement the GENIUS Act, effective Jan. 18, providing long-awaited guidance for banks and OCC-regulated entities that hold, issue, and move stablecoins. The rule bans direct yield payments from stablecoin issuers but allows case-by-case evaluation of third-party reward arrangements. It does not address Bank Secrecy Act, anti-money laundering, or OFAC sanctions, which will be covered in a separate rulemaking with the Treasury. The OCC will later announce when it will accept applications and waiver requests. Treasury Secretary Scott Bessent called the rule a 'watershed moment,' while the ICBA raised concerns about risks to community bank lending.
At Money20/20, PNC CEO Bill Demchak said AI agent-only financial transactions will never occur because banks won't allow transactions without human oversight. He warned that such agents could lead to fraud and 'mess with people's lives,' and suggested tech companies like Meta should bear liability for agentic transactions. Demchak noted PNC's aggressive AI push and its pause on M&A to avoid slowing AI progress. Several major banks, including JPMorgan Chase and Citi, are blocking AI agents from customer accounts.
At an Axios event in Las Vegas, FDIC Chair Travis Hill said AI agents moving deposits on behalf of customers is a major concern for banks and regulators, with questions about how many depositors will delegate decision-making and the impact on the deposit landscape. He noted that big banks like Citi, Bank of America, and JPMorgan Chase have blocked external AI agents, and that accountability questions remain. Hill also said revised model risk management guidance doesn't work well for agentic and generative AI, and the FDIC is considering seeking public input. The agency is using AI for efficiency in supervision and failed bank resolutions but wants to move faster.
At the Money20/20 conference, Wells Fargo's Faraz Shafiq detailed the bank's strategic approach to AI transformation. The strategy centers on four core components: a hub-and-spoke operating model, prioritizing highest-impact use cases, balancing speed with governance, and upskilling employees. Shafiq highlighted tangible benefits, including a 40% boost in product sales rates from banker intelligence capabilities and a custom small language model for fraud detection that outperforms off-the-shelf models. Wells Fargo aims to fundamentally transform how the bank operates by leveraging its proprietary data and focusing on the most valuable applications.
TabaPay's 2024 near-acquisition of Synapse Financial fell through due to messy books, but CEO Rodney Robinson says the experience led the company to pursue a bank instead. TabaPay plans to buy Denver-based Transact Bank, rename it TabaBank, and operate it under TabaHoldings, a new bank holding company. The deal, expected to close in Q4 pending regulatory approval, will give TabaPay a fintech-focused bank with branches in Denver and Palo Alto. Robinson says TabaPay will continue working with its partner banks while growing TabaBank.
Speaking at the Money20/20 conference in Las Vegas, Carole House, founder and CEO of Penumbra Strategies and a former Treasury Department official, said regulators can be slow to respond to innovation but industry often doesn't acknowledge its role in driving understanding. She stressed that collaboration is crucial to combat threats to the financial system, especially amid burgeoning technologies including blockchain and agentic commerce. House advocated for more timely enforcement, clarity of regulatory frameworks, and information sharing, drawing lessons from cyber to share information instantaneously. She also highlighted the need for investments in digital identity to address fraud and the authenticity crisis fueled by AI deepfakes.