HSBC has inked a multi-year partnership with Mistral AI, aiming to fast-track the use of generative AI across the bank’s global platform with a focus on driving automation and sharpening client services.

Under the agreement, HSBC and Mistral’s applied AI, science and engineering teams will collaborate to develop genAI solutions across the organisation, with the bank hosting the French AI startup’s commercial models in‑house to couple with its own tech.

The agreement means the bank will also be first in line for future upgrades, providing it with a potential edge in the AI arms race.   

Announcing the tie-up, HSBC said the deal was a “valuable opportunity” to tap Mistral’s know‑how and upgrade its internal tools, including an AI platform used by staff worldwide to support productivity tasks.

The bank said this could lead to benefits for financial clients, like hyper-personalised communications or enhanced analysis of complex, paperwork‑heavy lending and financing deals.

HSBC said that the deal will also see Mistral’s tech applied to multilingual reasoning and translation services, as well as fuelling development innovation in the hope of dramatically speeding up the time it takes to go from prototype to launch for new features.

“We are proud to engage in this long-term partnership with HSBC,” said Arthur Mensch, Mistral AI co-founder and CEO.

“Our highly customisable, enterprise-grade frontier AI solutions will reinvent HSBC’s workflows and services while ensuring full ownership of data. 

“Together, we will provide HSBC’s employees with high-end, AI-powered productivity tools and a new generation of banking services for millions of customers worldwide.”

AI is an integral part of HSBC’s technology strategy, with the bank claiming over the summer to be running over 600 AI use cases in areas like fraud detection, cybersecurity, transaction monitoring, customer service and risk assessment.

Future areas of focus for HSBC include customer-facing innovations, such as improvements to credit and lending processes, enhancing customer onboarding, and fraud and anti-money laundering checks.

Competition is fierce, however, with UK banks predicted to plough more than £1.8 billion into AI by 2030, and twice as many banks reporting active AI use cases compared with last year.

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On the other hand, banks that fail to fully embrace AI risk losing up to $170 billion (£127.5bn) in profits, according to a report from McKinsey. For banking leaders, the FOMO is real, with a score of international banks like Citi and Santander introducing mandatory AI training for staff.

However, gaining real value will take more than eeking out a few percentage points in employee productivity savings, with the winners being those who move first and move fast to make AI a genuine differentiator, something HSBC hopes the deal with Mistral can achieve.

“Working with Mistral is an exciting step forward in HSBC’s technology strategy, enabling us to further enhance AI capabilities across the bank,” said Georges Elhedery, group CEO at HSBC.

“The partnership will equip our colleagues with tools to help them innovate, simplify daily tasks, and free up time to deliver for our customers.”