The world’s largest international bank isn’t just dipping its toes into artificial intelligence. It’s diving in headfirst and it’s bringing 85% of its workforce along for the ride.
The Biggest Bet in Banking Right Now
HSBC has a clear answer to the question every major financial institution is wrestling with: Where does the money go?
Generative AI. Full stop.
During its Q4 2025 earnings call on February 25, 2026, HSBC CEO Georges Elhedery didn’t mince words. When asked where the bank’s biggest technology investment was headed, he said: “If you ask me, ‘Where is the biggest investment going into the new technology today,’ it is definitely going into generative AI.”
That’s a bold statement from the CEO of a $68 billion-revenue global bank. But HSBC isn’t just talking. It’s acting and the numbers back it up.
The bank has reallocated $1.8 billion in costs toward priority growth areas, including technology, digital infrastructure, and AI. It’s hired approximately 1,800 net new technology employees. And it’s already decommissioned over 1,100 legacy applications with plans to retire a third of its entire application portfolio by 2028.
This isn’t a pilot program. This is a full-scale transformation.
Retiring the Old to Fund the New
Here’s something that doesn’t get enough attention in the AI conversation: you can’t build the future on a crumbling foundation.
HSBC runs more than 9,000 applications. That’s a massive, sprawling tech estate and a lot of it is dead weight. The bank identified roughly 3,000 of those applications as “legacy or non-strategic.” It plans to retire all of them by 2028.
In 2025 alone, HSBC decommissioned 1,165 non-strategic applications. That’s 36% of its four-year target done in a single year.
Why does this matter? Because every retired application frees up investment capacity. Less maintenance. Less technical debt. More budget for AI, cloud, and digital platforms that actually move the needle.
Elhedery described the goal as a “fundamental reengineering of our processes end to end.” The idea is to let generative AI help redesign processes in a simpler way and then integrate AI directly into those redesigned workflows.
It’s a clean-slate approach. And it’s working.
85% of Employees Are Already Using AI Tools
Let’s talk about scale for a second.
HSBC has tens of thousands of employees spread across the globe. Getting even a fraction of them to adopt new technology is a logistical challenge. Getting 85% of them using generative AI tools? That’s remarkable.
According to CIO Dive, HSBC has given 85% of its workforce access to generative AI tools as part of its push to become “future-ready.” The bank isn’t just deploying AI for customers or back-office automation. It’s putting it directly in the hands of the people doing the work every day.
The results are already showing up. Elhedery pointed to coding assistance tools as a standout example. Engineers using AI-powered coding assistants are patching vulnerabilities five times faster than before. That’s not a marginal improvement. That’s a step-change in productivity.
And it goes beyond engineering. More than 31,000 engineers are now equipped with AI-enabled coding assistants. Over 1,000 relationship managers are using a Wealth AI platform to deliver personalized insights to clients. More than 50% of CRM engagement is now supported by Banker Assist AI tools.
The bank isn’t waiting for AI to prove itself. It’s already proving itself every day, across thousands of employees.
Redesigning 50 Processes From the Ground Up
Productivity tools are one thing. Process transformation is another.
HSBC is using generative AI to assess and redesign 50 end-to-end processes. These aren’t minor tweaks. The bank is looking at core banking workflows fraud detection, credit applications, customer onboarding, KYC (Know Your Customer) checks, data access, and contact center operations.
Think about what that means for fraud detection alone. Traditional fraud systems rely on rules-based logic. They flag transactions based on predefined patterns. AI changes the game entirely. It can analyze behavior in real time, spot anomalies that no human would catch, and adapt as fraud tactics evolve.
The same logic applies to credit applications. AI can process more data points, faster, with greater accuracy. It reduces manual review time. It improves decision consistency. And it opens the door to more personalized lending decisions.
InfotechLead reports that HSBC has more than 600 AI use cases already in place across the organization. That’s not a handful of experiments. That’s a bank that has embedded AI into the fabric of how it operates.
Elhedery summed it up well: “The result of which is a more productive bank, more efficient bank and a safe bank with stronger controls.”
The $1.8 Billion Reallocation: Where the Money Is Going
HSBC isn’t spending new money on this transformation. It’s being smarter about the money it already has.
The $1.8 billion reallocation breaks down like this: $1.5 billion comes from general simplification efforts cutting costs in non-strategic areas and redirecting them toward high-return initiatives. The remaining $300 million comes from synergies generated by the privatization of Hang Seng Bank, with capital redirected toward growth in Hong Kong.
The bank achieved its 2025 target of 3% basis cost growth and plans to reduce that further to just 1% in 2026. It delivered $1.2 billion in annualized simplification savings in 2025 exceeding its original $1 billion target. Total simplification savings are expected to reach $1.5 billion by the first half of 2026.
That’s disciplined financial management. Cut the fat. Invest in the future. Repeat.
The bank is also leaning into organizational simplification. HSBC reduced net Managing Director roles by approximately 15% in 2025 as part of a de-layering initiative. Fewer management layers mean faster decisions. Faster decisions mean a more agile bank.
Customer Experience Gets a Generative AI Upgrade
Here’s where things get interesting for everyday banking customers.
HSBC isn’t just using AI to make its internal operations more efficient. It’s deploying the technology to fundamentally change how customers experience banking.
Elhedery anticipates that “customer experience will be materially enhanced” as the bank rolls out generative AI tools to personalize and tailor each customer’s banking journey. That’s a significant promise and the early signs are encouraging.
Contact centers are already using AI tools to help agents respond faster and more accurately. Relationship managers are using AI-powered platforms to deliver wealth insights that feel personal, not generic. And the bank added 1.1 million new-to-bank customers in 2025, with Premier customer numbers growing 11%.
The Stack reports that HSBC is simultaneously moving from a cloud-first strategy to a “more mature” hybrid approach. That shift reflects a growing recognition across the industry that not everything belongs in the cloud and that a thoughtful hybrid model can deliver better performance, security, and cost efficiency.
Asia and the Middle East: HSBC’s Growth Engine
AI transformation doesn’t happen in a vacuum. It needs a strategic direction. For HSBC, that direction is clear: Asia and the Middle East.
The bank is positioning itself as a financial “super connector” linking these two high-growth regions. It’s a role that plays directly to HSBC’s historical strengths deep roots in Hong Kong, strong relationships across Southeast Asia, and growing influence in the Gulf.
The $13.7 billion privatization of Hang Seng Bank is a cornerstone of this strategy. It gives HSBC greater control over one of Hong Kong’s most important financial institutions and redirects capital toward growth in one of the world’s most dynamic wealth markets.
Wealth fee income increased 24% in 2025. HSBC aims to become the leading cross-border wealth hub in Hong Kong by 2029. That’s an ambitious target but the bank is building the digital infrastructure to support it.
For the 2026–2028 period, HSBC has set ambitious performance goals: a Return on Tangible Equity of 17% or higher, and year-on-year revenue growth rising to 5% by 2028.
The Blockchain Play: Digital Gilts and Tokenized Deposits
HSBC isn’t just investing in AI. It’s also building next-generation financial infrastructure.
The U.K. Treasury selected HSBC’s distributed ledger technology platform for the U.K. Digital Gilt pilot. That’s a significant vote of confidence in the bank’s blockchain capabilities and a sign that HSBC is positioning itself at the forefront of digital capital markets.
Customers are already using frictionless tokenized deposits and real-time payments in four markets, including the U.K. And 24/7 payment services are active across 35 markets globally.
This isn’t just about keeping up with fintech competitors. It’s about defining what the future of banking infrastructure looks like and making sure HSBC is the one building it.
How HSBC Stacks Up Against the Competition
HSBC isn’t alone in its AI ambitions. The entire banking sector is racing to deploy the technology.
Banks are planning an average of $133 million in AI investments over the next 12 months, according to a KPMG AI Quarterly Pulse Survey. More than eight in ten respondents said they expect to continue investing regardless of their ability to measure immediate returns. That’s a remarkable level of commitment and a sign of how seriously the industry is taking AI.
UBS is using AI to redesign front and back office processes. TD Bank implemented roughly 75 AI use cases in 2025, targeting loan underwriting and customer relationship deepening. JPMorgan, Goldman Sachs, and Bank of America are all making significant AI investments of their own.
But HSBC’s approach stands out for its scale and ambition. The combination of workforce-wide AI adoption, aggressive application retirement, process reengineering, and strategic capital reallocation puts it among the most aggressive AI transformers in global banking.
What This Means for the Future of Banking
Step back and look at the big picture.
HSBC is essentially rebuilding itself from the inside out. It’s retiring legacy technology, retraining its workforce, redesigning its core processes, and redirecting billions of dollars toward AI and digital infrastructure. All at the same time.
That’s not easy. It requires strong leadership, clear strategy, and the organizational discipline to follow through. The early results suggest HSBC has all three.
The bank is more productive. It’s more efficient. It’s growing in the markets that matter most. And it’s building the technological foundation to compete in a world where AI isn’t a differentiator it’s the baseline.
For customers, that means faster service, smarter fraud protection, and more personalized banking experiences. To employees, it means better tools and more meaningful work and for shareholders, it means a bank that’s positioned for sustainable growth in an increasingly technology-led financial services landscape.
HSBC has made its bet. And right now, it looks like a smart one.
