Hi, I'm Matt. Welcome to AI Street, where AI meets Wall Street. Every Thursday, I share curated news, analysis, and expert interviews.

The Rundown 

• AI Marketing Boosts Banks' Revenue by $2.5B: Persado

• AI Rules Crawl Forward as Tech Races Ahead

• CFTC Looks to AI to Boost Surveillance

• BNY Deploys AI Assistant Eliza

• Corporate Execs Bullish on AI, Despite Bubble Concerns

• CIBC Invests $10M in AI Firm Boosted.ai

• + Quick Links

INTERVIEW
AI-Crafted Marketing Drives $2.5B Revenue for Banks: Persado

AI Street recently sat down with Assaf Baciu, co-founder and President of Persado, to discuss how generative AI is transforming marketing.

Persado, a New York-based company founded in 2012, has established itself as a leader in AI-driven marketing solutions. Working with eight of the 10 largest U.S. banks, Persado's AI technology harnesses vast amounts of customer behavior data to tailor marketing language down to the individual level. Clients include Chase, Ally, SoFi, and NatWest.

The company has generated more than $2.5 billion in additional revenue for its financial services clients over the past five years. Baciu shares his insights on implementing AI in a heavily regulated industry and broader trends in AI adoption among financial institutions.

What has surprised you about recent AI developments?

Even for practitioners in the field, the capabilities of these models are still amazing. It seems like the bigger models behave in a way that certain areas of the brain get to be more specialized without any specific guidance to do that. So it's an awkward outcome, right? That a bigger model is better, but it's better because it actually develops specialization in certain areas of the layers. And this, even for a practitioner, it’s quite amazing.

See the full interview here.

REGULATION
AI Rules Crawl Forward as Tech Races Ahead

Despite growing concerns about AI safety, federal legislation in the United States remains slow going. Senate Majority Leader Chuck Schumer expressed optimism about passing an AI package by year-end, but that may prove challenging in an election year, per the WSJ.

At the state level, California's Senate Bill 1047, which would require AI developers to conduct safety tests, has advanced but faces opposition from tech companies and some politicians. OpenAI recently voiced concerns that the bill could hinder innovation and argued for federal-level regulation instead.

• Former House Speaker Nancy Pelosi criticized the California bill, calling it "well-intentioned but ill informed." The bill is expected to be voted on later this month.

• Critics of state-level legislation, including OpenAI, warn it could create a complex patchwork of regulations, potentially driving AI companies out of states with stricter rules, according to Bloomberg.

• The American Bankers Association, along with 21 other state banker associations, also called for any new federal AI legislation to override state laws to ensure banks are exempt from duplicative rules.

CFTC Looks to AI to Boost Surveillance

Ted Kaouk, the agency’s chief AI and data officer, said the derivatives regulator is undergoing a “significant” overhaul of its oversight capabilities thanks to AI.

• The CFTC is testing AI tools to detect market anomalies and potential fraud, such as spoofing (a form of market manipulation).

• "We want to send a strong signal to bad actors that misconduct will be identified and punished,” Kaouk told FedScoop.

AI ADOPTION
BNY Deploys AI Assistant Eliza

BNY Mellon has launched Eliza, an AI tool that allows employees to create customized virtual assistants for specific tasks, according to Fortune. Named after Alexander Hamilton's wife, Eliza combines elements from OpenAI, Google, and Meta to tackle tasks ranging from Agile project management, a popular tool for software developers, to regulatory compliance. 

BNY has developed several AI tools, though they haven't disclosed the exact number. Tools include:

• A system that analyzes funds, identifies unusual patterns, and assists accountants in resolving issues.

• One that helps investment managers customize portfolios.

About a quarter of the bank's employees (around 14,000 people) are currently using the AI assistant.

Corporate Execs Bullish on AI, Despite Bubble Concerns

Executives report that generative AI is already significantly influencing how they chart the course for their organizations, according to a new survey by KPMG LLP of 225 senior leaders at billion-dollar companies.

• 83% expect increased gen AI investments over next 3 years.

• 71% are already leveraging AI-driven data in decision-making.

FUNDRAISING
CIBC Invests $10M in AI Firm Boosted.ai 

CIBC Innovation Banking provided $10 million in growth capital to Boosted.ai, a Toronto-based company specializing in AI-driven investment management solutions. Founded in 2017, Boosted.ai will use the funds to enhance product development and expand sales operations in Canada and the US, according to a press release.

• The company’s technology allows institutional investors and wealth managers to train AI agents for automating investment processes.

• Its AI can analyze millions of financial documents, streamlining client workflows and reducing research time.

QUICK LINKS
Citadel Hires Goldman Tech Chief

Citadel has tapped Goldman’s Atte Lahtiranta to run its core engineering group, according to Bloomberg. The focus on AI has put the spotlight on positions such as CTO and chief information officer, Citadel’s Ken Griffin said in May. Executives in those jobs have key seats at the table and “they’ve got the attention of the CEO,” he said. (Bloomberg)

• Also: DeepMind researchers are a hot commodity. Hedge fund Balyasny just hired one. (eFinancialCareers)

Goldman Sachs CEO David Solomon: “AI is not a bubble”

The banker is convinced that AI is here for the long-term. (Yahoo)

BBVA Doubles AI Staff

BBVA has doubled the number of staff working on AI to more than 400 as it opens new 'AI Factories' in Mexico and Turkey. (Finextra)

Thanks for reading!

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