AI use will increasingly influence bank credit ratings, S&P says
S&P says governance and operational readiness will separate winners from losers as banks expand their use of artificial intelligence.
Artificial intelligence will increasingly influence banks’ credit ratings as lenders expand their use of the technology, S&P Global Ratings said in a report Monday.
The ratings company said the winners and losers will be determined by the maturity of banks’ AI strategies and the strength of their governance frameworks. Uneven adoption, governance and operational readiness could strengthen or weaken financial institutions’ creditworthiness over the next several years.
S&P surveyed 179 finance firms worldwide in June. The firms expect AI-related cost reductions of as much as 4% this year, increasing to between 6% and 8% by 2028.
About 84% of the surveyed firms said they already use AI in support functions and automation. Fewer than one-third use it to develop new products and services, with regulation and reputational risks limiting broader adoption.
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The net credit effect will depend less on adoption alone than on whether banks convert cost savings and additional revenue into sustainable improvements in profitability while maintaining sound risk management, said Miriam Fernandez, S&P’s AI research and adoption lead.