Lloyds Banking Group is to hire 300 technology specialists to work on artificial intelligence, in a move that comes weeks before chief executive Charlie Nunn is expected to unveil a new multi-year strategy for the 261-year-old lender.
The recruits – who will join a 1,000-strong AI team that also includes existing staff retrained by the bank – are due to begin work by September. Their primary focus will be on “agentic AI”, a form of autonomous artificial intelligence that can plan and execute tasks with minimal human oversight. Trystan Davies, Lloyds’ group head of data and AI science, said the new hires would deploy existing large language models such as Anthropic’s Claude and build on top of public models, including Google’s Gemini, tailoring them to the bank’s own specifications.
While the recruitment drive will increase Lloyds’ headcount in the near term, the group has not ruled out the broad adoption of AI leading to job cuts in the future. In January, Nunn acknowledged that the bank would have to “reduce some jobs in some areas” owing to AI. The trend is already visible elsewhere: last month Standard Chartered announced 7,000 job cuts, partly driven by AI, and its chief executive, Bill Winters, later apologised for describing the move as “replacing, in some cases, lower-value human capital”.
Davies said the AI cohort would be deployed to a range of projects, including identifying and preventing scams and fraud, and improving internal processes such as searching and distilling reams of HR documents. But one of the most significant uses will be in online banking, where customers will be able to interrogate their spending habits and ask plain-language questions about their finances – for example, which investment or savings products might best suit their circumstances. “It results in a much better customer experience because our systems are kind of geared up in the right way,” Davies added.
Agentic AI and its impact on jobs
Agentic AI, the technology Lloyds is prioritising, represents a step beyond conventional generative AI, which creates new content from patterns in vast datasets. These autonomous models are designed to plan, decide and act without constant human direction. Davies said: “AI will reshape how organisations are structured. It will change roles and how we work, and we are investing in training for colleagues through that transition.”
The bank’s AI programme has already delivered financial gains. Generative AI provided a £50m boost to Lloyds’ balance sheet last year, and the bank expects a £100m benefit this year as it expands the use of agentic models. Nunn is closing out a current five-year strategy that included a major push towards online banking, hundreds of branch closures, and a renewed focus on pensions and wealth management. His new strategy, due next month, will be closely watched by staff and investors.
While the potential for efficiency gains is clear, the shift to autonomous AI carries significant risks. Research by KPMG suggests that some UK banks are becoming reliant on AI faster than they are preparing for system failures. The consultancy’s latest financial services sentiment survey found that 93% of UK bank executives believed they could keep operating in a significant outage, but only 47% had carried out a single test around AI disruption, and 26% had not conducted any tests at all.
Rob Smith, UK head of regulatory and risk advisory at KPMG UK, said the industry’s optimism about its ability to continue business as usual if a critical AI system fails at scale “could mean one of three things: one, firms have invested considerably in model validation, contingency planning and risk prevention; two, firms’ use of AI tools is relatively simplistic; or three, they don’t yet have a complete grasp of their exposure.” He added: “Firms have invested time and money, but without regular, robust testing, how do you know what you’re doing is working? And, crucially, how do you prove your resilience to the regulator, customers and stakeholders?”
