• John Duigenan, General Manager of Financial Services at IBM Technology, and Shanker Ramamurthy, Global Managing Partner Banking at IBM Consulting


• 21.06.2024 10:03 am

Nodira Sadikova, Multimedia Partner of Financial IT sat down with John Duigenan, General Manager of Financial Services at IBM Technology, and Shanker Ramamurthy, Global Managing Partner Banking at IBM Consulting to discuss how IBM is shaping the future of financial technology through its innovative AI solutions and strategic collaborations.

Nodira Sadikova, Financial IT: How are IBM's enterprise AI solutions transforming the financial services industry?

John Duigenan: IBM has been working in AI for many years. Since the introduction of generative AI, IBM launched the watsonx technology platform, designed for enterprise use and comprising three main components: watsonx.ai, watsonx.data, and watsonx.governance.

watsonx.ai is a studio for building and training generative AI models. watsonx.data is an open data lake enabling clients to manage their data and model training assets flexibly. watsonx.governance provides governance capabilities for managing model lineage, design, and performance over time. We're applying these tools across various use cases relevant to our regulated clients in financial services.

Customer experience is often the first area of focus, removing friction through virtual assistants and generative AI, ensuring contextual and seamless interactions across channels. We're also enhancing employee productivity by automating back-office processes such as KYC, onboarding, regulatory compliance, and payments processing. Additionally, we're boosting developer productivity by using generative AI to modernize and work with legacy code, some of which is decades old. Our AI solutions run wherever our clients need, including on-premises, making IBM the only AI provider offering a comprehensive, trusted, and hybrid-capable platform.

Nodira Sadikova, Financial IT: How is IBM leveraging its collaboration with fintech startups to innovate and enhance its offerings in the financial services sector?

John Duigenan: IBM is an ecosystem-focused company, viewing AI and generative AI as a collaborative effort. We embrace an open ecosystem to innovate quickly across thousands of AI models, involving a vibrant community of software vendors, startups, established companies, consulting partners, and delivery partners. Our fintech ecosystem is vibrant, enabling us to deliver capabilities that older firms might only dream about. By combining existing and new technologies, we can deliver innovations through an open ecosystem approach.

Shanker Ramamurthy: Absolutely. On the consulting side, we maintain a client-first mindset, bringing our ecosystem partnerships to the table. If clients prefer other partners, we work with them to drive client value. At a macro level, three technologies are critical: hybrid cloud, AI/generative AI, and quantum computing. Hybrid cloud represents the current landscape, with substantial investment and ongoing development. AI and generative AI are more recent, and we're still in the early stages of their exponential growth. Quantum computing is a bit further out, but important aspects like quantum-safe cryptography are already relevant for financial institutions.

Nodira Sadikova, Financial IT: What are some of the key trends and technologies that IBM sees shaping the future of the financial services industry? How is IBM preparing to help its clients navigate this evolving landscape?

John Duigenan: Regarding the EU AI Act, some might see it as a burden, but we view it as an opportunity. Demonstrating that AI is trusted and governed can be a significant competitive advantage. Compliance with the EU Act requires thorough understanding and documentation of the data used to create AI models, ensuring it is trustworthy and free from intellectual property issues. IBM can measure and monitor the performance of generative AI models from various vendors, helping clients comply with regulations and maintain trust.

Shanker Ramamurthy: Client success stories showcase how our clients use IBM technology to innovate.

We learn from these successes and the challenges, driving the journey forward. Implementation and execution are the next phases, unlocking economic value. Recent surveys show only 8% of banks are implementing generative AI enterprise-wide, but this is expected to grow to 80% within a year. CEOs recognize generative AI as strategic but face challenges in finding the right talent and ecosystems. We bring together IBM technology, market offerings, and client needs to achieve outcomes. I often ask CEOs three key questions: Is your strategy ambitious enough? Are you executing fast enough? Do you have the right people and capabilities? If not, leverage the ecosystem and act now.

Nodira Sadikova, Financial IT: What is next for IBM?

John Duigenan: The next phase is all about implementation, execution, and unlocking economic value. Over the next few years, we expect significant re-architecture and optimization of mainframe software code for the mainframe and hybrid cloud environments. We're very excited about the potential of generative AI in achieving these outcomes and continuing to lead in this transformative journey.

Nodira Sadikova, Financial IT: I appreciate your insights, John and Shanker. Your commitment to a community-driven approach and innovation is inspiring. Thank you for joining us today. Stay tuned for more from Financial IT.