Two of the biggest Nordic banks have recently increased their human workforce significantly, but say the headcount is temporary.
Mikael Bjertrup, head of the Nordea bank Abp financial crime prevention unit has hundred of employees who scrutinize billions of transactions in order to catch anything that looks potentially criminal. According to Bjertrup, 20 per cent of suspicious alerts are currently closed by algorithms, based on machine learning, while the rest still being handled by humans. He wants to see those numbers reversed so that algorithms handle 80 per cent.
“We’ll be fewer people in the future, but our defense will be better,” he said. “We won’t need as many as 1,500 employees in the future, as technology improves.”
The head of compliance at Danske Bank A/S, Philippe Vollot, also says headcount will probably be scaled back once “technology kicks in.”
The hiring binge at Nordea started in 2015 after it was fined for failing to live up to anti-money laundering requirements. More recently, laundering scandals that engulfed Danske and Swedbank AB have added to pressure on the industry to allocate much bigger resources to fighting financial crime.
With labor accounting for roughly three-quarters of the cost of complying with anti-money laundering requirements, Nordic banks are figuring out how to replace people with artificial intelligence, algorithms and automated customer screening. They say a key frustration now is that the authorities are struggling to keep up, after banks plowed huge amounts of money into their risk controls.