As part of an ongoing series about artificial intelligence, the Asahi Shimbun on Jan. 11 published a story that asserts the financial industry has adopted AI more readily than any other. Because finance is a data-driven endeavor, designing AI software to do things such as read and analyze reams of economic information and project future investment performance is progressing rapidly. Moreover, voice recognition is becoming so advanced that standing clients and potential customers will no longer have to talk to humans about their financial needs. Even if a person is going to make the final decision about a transaction, most of the work has already been done.

This development, however, may also hasten the end of banks. Due to Japan’s zero interest rate policy, domestic banks can’t make money on loans, so they’ve become clearinghouses for other financial companies’ products, be it mutual funds or insurance policies. Banks are basically salesmen who collect handling fees for delivering products and services. Once that task is automated or otherwise rendered obsolete by new technology, what’s the point of a bank?

These types of stories have been receiving a great deal of attention in the media for a while now, and Asahi’s affiliate weekly magazine, Aera, devoted a large portion of its Jan. 22 issue specifically to the end of banking in Japan. The articles seem to be a response to announcements made in recent months by the three Japanese “megabanks” that they would be eliminating a large number of jobs over the next decade: 19,000 at Mizuho Financial Group, 9,500 at Mitsubishi UFJ Financial Group and 4,000 at Sumitomo Mitsui Financial Group.

The title of the lead Aera feature, “Seven more years for banks,” makes it clear. The article opens with a scene that took place at a Mizuho branch on Oct. 28. Alarmed by media coverage of the staff cuts, employees confronted a manager, who said that the reductions would be carried out through “natural attrition,” meaning scheduled retirement and dwindling university recruitment targets. It didn’t mean that any existing employees would be laid off.

However, elsewhere in the article, as well as in other articles in the issue, Aera explains that banks are anachronisms. The idea of a bank, which operates by paying interest to people who save their money there and then lends that money to others who pay the bank a higher interest rate, doesn’t apply any more. People will still need to borrow money, but the mechanics of financing is changing. The government has tried to postpone the end of banking by allowing more mergers, but there’s nothing left to merge. Banks still boast respectable profits, but that’s because they take advantage of Japan’s and others’ relatively robust economies and invest customers’ savings in stocks and bonds. They don’t need a lot of people to do that.

Bankers who joined their companies during the bubble period in the late 1980s are feeling the most anxious, since they are due for retirement in the next decade or so. In its lead article, Aera cites a questionnaire given out by one bank to management level employees that provides three future job options: remaining at the bank where they are currently employed, transferring to an affiliate company or transferring to a client company of the bank. This last option is a custom peculiar to Japan: When there are no higher-level openings for a senior manager, the company will pressure a client to hire the manager for a dead-end job. In any case, there will be even fewer management slots in the future within banking companies.

Younger bank employees may be better off looking for new jobs now while they’re at an age where they can still work their way up in another firm, but as one article points out, despite the high salary and perks that often come with a job in banking, more and more bankers are realizing that there is no guarantee that they will end up in the “elite course” management position they were led to expect. Even worse, they don’t feel they have any control over their future.

Aera contends that bank jobs are still coveted by university students. More than 600 graduates of the University of Tokyo, the most prestigious school in Japan, have been recruited by megabanks over the past 10 years. The magazine finds this puzzling, since banks lost their luster after the asset bubble burst in the early ’90s. Smaller, regional banks either went bankrupt or were absorbed by larger firms. Then in 1998, the government had to inject money into the banking sector to keep it solvent. Banking gradually became a seedy enterprise in the public imagination, with employees chasing after more deposits and figuring out ways to increase interest rates on existing loans. And, despite the enormous popularity of the 2013 TV series “Hanzawa Naoki,” which dramatized the intrigues of Japanese banking during the postwar economic miracle, bank employees are no longer considered great catches at gōkon, the organized group dates in which men and women get together for purposes of possible future matrimony.

One recruitment consultant told Aera that banks remain popular among students for reasons that have nothing to do with what they want from life. Students from prestigious schools have been “winners” their whole lives, and banks are thought of as the most discriminating employers, so they appreciate the challenge of trying to be hired by a bank even if they aren’t particularly keen to work for one. It’s about inertia, not ambition. And since banks are all the same, they try to recruit students from top schools in order to add distinction to their respective workforces.

In the Dec. 20 edition of Diamond Online, economics critic Hajime Yamazaki wrote that he always tries to dissuade young people from working for banks. The salaries may still be high, but so is the risk of being laid off and the chance of upward mobility is getting slimmer all the time.

Bluntly put, Yamazaki says banks hire excellent people and then squander their potential. It’s just as well they’re disappearing.

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