Fifth Third tells that AI cash agents are a small risk

Tim Spence is the CEO of Fifth Third. On Monday, Spence told the earnings call that online-only lenders have the most risk from AI cash agents. Meta released Muse, an AI assistant, and banks think that agents can move cash to accounts that pay more. The CFO, Bryan Preston, told that the risk is likely overblown, but the bank does not ignore it. The bank has $301 billion in assets.

What the bank tells

Spence tells that only banks with price as their value have the most risk. Other banks have branches and services that add value. The bank will add the same services as Muse, for example savings checks, to the apps of the bank.

The numbers

• Median balance of the checking account: $3,000.
• Core deposits: 3% more, at $236 billion.
• Deposit costs: 1.64%.

Preston tells that this is not much cash to move for yield. The bank gave no number for cash that agents moved.

What is not known

Preston tells that adoption of agents is possibly accelerated. The Financial Times told that Citi and Bank of America also stop external agents from the accounts, as JPMorgan does. Jamie Dimon of JPMorgan tells that there is a liability transfer to the customer.

Insight: Banks tell that the risk is small but stop the agents

Citi, Bank of America and JPMorgan stop external agents, and Schwab does too. The economist Torsten Slok tells of the rates. Agents can move cash from accounts that pay 0.1% to accounts that pay 3.3% to 5%. This reads as a race for the front door of the customer: banks stop the agent and copy its services. The bank that holds the account keeps the control, and agent builders must plan for refusals.