UK banks invest in hiring as benefits from AI remain elusive

KPMG's 2026 State of the Banks report reveals that major UK banks continued to expand their workforces and increase staff costs per employee in 2025, as they invested in specialist skills and transformation activities. Although more than half of banks reported at least one AI use case delivering measurable benefits, these gains were concentrated in specific functions with little evidence of enterprise-wide financial performance improvements. Steve Payne, KPMG UK & Switzerland Head of Banking, emphasized that banks must get fundamentals like robust data and operational resilience right before realizing full AI benefits. The report also notes that high-street banks and neobanks show the highest AI maturity, while the market is splitting into two tracks: larger banks leveraging scale and funding advantages, and smaller banks competing aggressively for market share. Building societies and neobanks increased their share of customer deposits and lending between 2021 and 2025, with building societies gaining approximately £84 billion in deposits and neobanks £25 billion, while high street banks' deposit share fell from 85% to 79%.

(Source：Hotminute)