Artificial intelligence is transforming recruitment standards at major financial institutions on Wall Street and across Europe.

UBS has become one of the first leading financial firms to formally incorporate AI capability into its hiring requirements for entry-level investment banking positions, according to sources familiar with the matter.

The new mandate will apply to graduates and interns joining its global banking and markets division in 2027. Candidates will need to demonstrate how they can leverage AI to "improve work outcomes and efficiency," signaling a shift of AI skills from technology and data roles into conventional banking operations.

This development coincides with escalating warnings about job cuts in the banking sector. Analysts at Morgan Stanley recently projected that more than 200,000 positions across European banking could be at risk over the next five years as institutions accelerate AI adoption and streamline branch networks.

AI literacy becomes a formal hiring requirement

UBS's new policy runs alongside traditional selection criteria, including minimum undergraduate achievement standards such as a 2.1 classification in the UK degree system. AI-related questions will be integrated into interview processes for graduates and interns, with recruiters assessing candidates' hands-on experience with the technology, according to insiders.

A spokesperson for UBS stated: "We continuously review our hiring criteria to ensure they reflect the skills we need. As AI fundamentally reshapes the financial services industry, AI capability and experience have become important components of future career success and therefore relevant considerations in recruitment. AI literacy complements, rather than replaces, the academic, analytical, and interpersonal qualities that remain central to our hiring decisions."

Sources also indicated that AI proficiency requirements extend to other recently advertised positions within the bank.

Industry-wide shift gains momentum

UBS is not alone in this approach. Company filings show that Spain's Santander has explicitly sought "advanced AI users" within select graduate programs in its corporate and investment banking divisions.

This trend reflects a deeper structural transformation within banking, where AI tools are increasingly handling routine tasks traditionally assigned to junior staff, including financial analysis, research report preparation, and client presentation development. UBS itself is experimenting with the technology in novel ways, including digital avatars for analysts that can deliver video presentations to clients, which the bank says enables employees to focus on higher-value activities.

Despite rising demand for AI competencies, some banking executives urge caution regarding over-reliance on technology. Conor Hillery, co-head of JPMorgan's Europe, Middle East, and Africa operations, said at the Financial Times Global Banking Summit in December that the industry needs to be "very careful" to ensure employees do not "lose understanding of fundamental knowledge and basic principles." He added that the firm is working to balance AI-driven acceleration of routine tasks with training junior staff in traditional core banking skills.

UBS's position aligns with this perspective, emphasizing that AI literacy serves as a complement rather than a substitute for existing requirements, with academic excellence, analytical ability, and interpersonal skills remaining core evaluation criteria. However, with AI now formally embedded in hiring conditions, the competitive landscape for graduates without systematic exposure to the technology has fundamentally shifted.