Investment banks, hedge funds, and asset management firms are rapidly integrating artificial intelligence into their operations, transforming everything from research and trading to internal workflows and decision-making. The financial sector is in the midst of a major AI-driven shift, with firms investing heavily to boost efficiency, reduce costs, and gain a competitive edge. JPMorgan Chase, the largest U.S. bank by assets, is leading the charge with an annual technology budget of $18 billion, much of it focused on AI. CEO Jamie Dimon is a vocal advocate, using the bank’s generative AI tools extensively. These tools are now available to over 200,000 employees. The bank has also replaced external proxy advisers with its own AI-powered platform, Proxy IQ, which analyzes data from more than 3,000 annual shareholder meetings to guide voting decisions. Goldman Sachs is spending $6 billion on technology this year, with CEO David Solomon expressing a desire to invest even more. The firm’s OneGS initiative highlights AI as a key driver of efficiency, with plans to slow hiring and make limited reductions in roles. Internal AI assistants are now accessible across the organization, helping employees automate routine tasks. Morgan Stanley, an early partner of OpenAI, has focused on turning employee ideas into functional AI tools. One such tool, DevGen.AI, has already saved engineers over 280,000 hours this year. AI adoption is especially high among interns, with 72% using ChatGPT daily or several times a week. Citigroup has rolled out proprietary AI tools to nearly 180,000 employees across 83 countries, with usage reaching nearly 7 million times this year. CEO Jane Fraser says the tools are saving about 100,000 developer hours weekly through automated code reviews. The bank also began piloting agentic AI with 5,000 employees in September. Hedge funds are using AI to enhance research, trading, and data analysis. Citadel has deployed an internal chatbot to help stockpickers process information faster. WorldQuant is using AI to extract insights from non-traditional data sources like images and audio. Point72’s CTO plans to expand the firm’s tech team with AI at the core. Bridgewater launched an AI-driven fund in 2024, using machine learning to replicate every stage of the investment process. Balyasny Asset Management built an AI bot to handle tasks typically done by senior analysts, with about 80% of staff using its internal tools. The firm recently hired a former CIA AI developer to strengthen its data science team. Man Group and Viking Global have also built their own internal AI systems. Private equity firms are turning to AI to improve deal sourcing and due diligence. Carlyle is working to bring AI to its 2,300 global employees. Blackstone is investing in enterprise search and using AI to expand its reach in the insurance market. EQT developed an AI engine called Motherbrain to help identify and evaluate investment opportunities. Thomas H. Lee found that AI coding assistants have increased engineer productivity by up to 30%. Asset managers are also embracing AI. BlackRock introduced Asimov, an agentic AI platform for its fundamental equity team. AllianceBernstein and JPMorgan are using AI to speed up portfolio management. VanEck invested in a Toronto-based fintech to enhance its ETF business, using AI to support analysts and sales teams. The crypto exchange Kraken used generative AI to conduct due diligence during its $1.5 billion acquisition of a retail trading startup, a process now considered standard. At Block, Jack Dorsey’s fintech company, engineers built an AI agent that writes code faster and sometimes better than senior developers, and the company open-sourced the tool. Chime, a neobank, created a private AI assistant to accelerate product development, with its CTO calling it a key part of the company’s innovation strategy.