Page 34 - Banking Finance July 2025

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Regulatory Complexity: Compliance requirements are ment their call centers and digital platforms, aiming to
growing more demanding and nuanced. reduce call wait times and improve customer satisfaction.
Customer Expectations: Consumers expect real-time,
personalized, and frictionless digital experiences. 2. Enhancing Risk and Compliance Functions
Banks operate under intense regulatory scrutiny. LLMs
Operational Efficiency: There is constant pressure to
are proving to be powerful tools in assisting with regu-
reduce costs while improving service quality.
latory compliance, anti-money laundering (AML), and
fraud detection.
LLMs help banks address these challenges by offering scal-
able, intelligent automation across key functions.
Applications:
Automated Document Review: LLMs can read and
1. Transforming Customer Service
summarize complex regulatory documents, highlight
One of the most immediate applications of LLMs in key changes, and even draft compliance reports.
banking is automated customer interaction. Unlike tra-
ditional chatbots, which rely on rigid rules and often KYC and AML Screening: They can analyze customer
frustrate users, LLM-based assistants understand natu- profiles and transactional behavior to flag suspicious ac-
ral language and respond in ways that feel genuinely tivities more accurately than rule-based systems.
conversational. Real-Time Transaction Monitoring: LLMs can parse
transaction narratives, cross-reference with databases,
Use Cases: and detect patterns indicative of fraud.
24/7 Virtual Banking Assistants: LLMs can handle com- By reducing the manual burden on compliance teams, LLMs
plex customer queries about account balances, loan eli-
not only cut costs but also improve the accuracy and time-
gibility, or transaction disputes without human inter-
liness of risk assessments.
vention.
Multilingual Support: Trained on multilingual datasets, 3. Revolutionizing Financial Reporting and
LLMs can serve global customers in their native lan- Analysis
guages.
Financial institutions are required to produce a wide
Sentiment Analysis: LLMs can detect frustration or ur- array of reports-for internal stakeholders, regulators,
gency in customer messages and escalate issues appro- and investors. LLMs can help automate the drafting,
priately. summarization, and even interpretation of these docu-
ments.
For instance, banks like JPMorgan Chase and Bank of
America are already piloting AI-driven assistants to supple-
Key Benefits:
Automated Report Generation: From earnings sum-
maries to ESG disclosures, LLMs can create readable,
structured reports based on input data.
Predictive Analysis: When integrated with market
data, LLMs can provide scenario-based financial pro-
jections and strategic insights.
Data Querying: Through natural language interfaces,
analysts can query databases without needing SQL or
technical skills.
For example, rather than navigating multiple dashboards,
a bank executive could ask, "What were the top five sources
of non-interest income last quarter?" and receive an instant
answer synthesized from internal data.

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