Citigroup is deepening a three-year strategic agreement that will propel the bank to shift part of its enormous financial infrastructure into Alphabet-owned infrastructure in the cloud, Google Cloud. Hardware is growing into an increasingly large material building block of America’s fourth-largest bank by assets, and the bank is headquartered in New York. It foresees that becoming a part of another virtual world will enable its money veins to be tailored and enable it to grow as its consumers’ ever-changing needs change.
As part of the partnership, Citi will also use Google Cloud’s Vertex AI platform to develop a portfolio of AI-driven financial products and services for customers, Balaji Kumar, global head of IT infrastructure at Citi, told Fortune.
While it wasn’t made clear how any of these offerings would be introduced first, Kumar stated “quite a few” pilots were underway.
“We can have this wonderful potential of added technology,” says Kumar. Infrastructure upgrade is part of a broad program across Citi to make the bank’s money pipes flow more smoothly, bringing in half of the bank’s revenues and driving much of the world’s economy.
Although the alliance is still in its infancy, Rohit Bhat, managing director of Google Cloud’s financial services business, said Google Cloud’s engineering, product, and sales teams have collaborated with Citi’s technology and business enablement team for several months, and most of the technology they’ve co-developed is fairly sophisticated.
The major advantage of the Google Cloud upgrades in Citi is an HPC function that will run millions of risk calculations per day for the Markets business. The system is designed to eliminate delays or latency by actively checking that transactions have sufficient processing power and storage capacity to finish.
Citi, under the agreement, will also be provided with access to open-source LLMs such as Gemma, Meta and Mistral, and Vertex AI, Google’s commercial offering based on its internal Gemini AI. In the future, the bank will employ the AI tool to complete other pilot projects currently in development, including customisation software for marketing, customer service and call centres, and document scanning.
With cloud and AI technology, of course, are the new security issues, that is, who views the information and where is it from. To Kumar’s credit, “every use case is regulated and monitored and approved” before it goes out to the public in an attempt to placate those concerns. This would necessitate careful examination of the data utilized, the type of where it is located, and if so, whether it is actually utilized or not to be used on a future date.
We were started with the platform of modernization really focused around reducing risk,” said Bhat of Google. “That is the basis for some of the more innovative things we are building, such as new services and products and improving our business’s overall customer experience.
Placement strategy
The alliance is part of Citi CEO Jane Fraser’s broader push to draw notice to its economic relevance as a financial infrastructure. Over the past year, it was reported that Fraser repositioned the company’s business lines as part of a move to shine the light on the bank’s treasury and custody products’ role in finance globally.
As Kumar of Citi explains, “a lean operating model will be the destination.” “Being able to be able to go where customers are and scale products is something our CEO and our leadership have talked a lot about.”
This partnership is a consequence of more exposure to AI across Citi. In highly expected June Citi reports, 56% of banking roles were on the verge of automation by artificial intelligence. In an effort to increase analysis of commercial lending, the bank made a strategic investment in Numerated, an artificial intelligence firm with commercial lending experience, four days after the report’s release.
Friday, Citi stock gained 1%. The shares of the company have increased 15% year-to-date, beating a 26% gain in the S&P U.S. The Banks Index at other banks in the United States during the same time.
Citi can differentiate itself from a few rivals through its partnership with Google. Goldman Sachs has just unveiled a generative AI about the time that Citi invested in Numerated, reports the Wall Street Journal. BNY last month had previously announced 14,000 of its employees working alongside Eliza, an AI that they named after Alexander Hamilton’s wife.
An Alphabet subsidiary and Citi have also been past collaborators. GooglePlex online checking product was discontinued the following year, but in November of 2020, Citi made public that it would collaborate with Google to offer a GooglePlex-fueled checking account.
The Citi deal is the newest step by Google Cloud to streamline AI adoption among banks. Most notably, Google Cloud teamed with Discover Financial Services, the parent of Discover Bank and issuer of the Discover card, in April to assist with rolling out its AI into customer support.
As Google’s Bhat says, “we believe there is a material step function increase in the ability for companies to see the information that’s between their four walls,” improve their customers’ experience and enable developers to have tools create new experiences entirely for customers. Machine learning and generative AI are employed to provide that step function change.’
Read More: Google Cloud announces Vertex AI search for healthcare widely available