Danske Bank cuts jobs; AI boosts developer output by 40%

Frans Woelders, head of technology and services at Danske Bank, stated in an interview with Bloomberg published on September 21 that the bank's workforce will continue to shrink in the coming years as artificial intelligence and other technologies permeate the entire organization, not just isolated departments. The bank has already cut 420 positions in February and another 262 in May, according to media reports on the institution's announcements, citing efficiency gains from digital tools and AI as the driver behind these cuts.

The Numbers Behind the Forecast

According to Woelders, Danske has about 4,000 developers, whose output has already increased by around 40% with AI tools. The goal is to reach 100% by the end of 2028, which essentially means doubling the output per person. In the rest of the company, employees estimate they save about two hours in a 40-hour workweek, a number that the executive expects to "dramatically" increase.

The forecast is supported by the Forward '28 plan, presented in April. In its goal statement for 2028, the bank raised its annual investment in core technology, AI platforms, and advisory capacity from approximately DKK 4 billion to about DKK 4.5 billion, expecting annual productivity gains of around DKK 2 billion by 2028 through AI and other initiatives. The arithmetic is about spending more on technology to maintain cost levels while revenue grows.

The Counterpoint from the Central Bank

On September 16, Danmarks Nationalbank published an analysis using data from Danish companies showing that firms adopting AI hire fewer employees than comparable competitors, with the effect concentrated among younger and more educated professionals. However, the same study found no signs of impact on salaries or aggregate employment in Denmark: those who were not hired found jobs elsewhere. The central bank acknowledges that, in the long run, the effect could go either way.

Conversely, the METR, an independent model evaluation lab, measured in 2025 that experienced developers took 19% longer to complete real tasks when using code assistants, although they believed they had become about 20% faster. In February 2026, METR claimed its latest data had become unreliable because some participants refused to work without AI, suggesting that the current gain likely exceeds that of 2025. A skeptic citing only the 2025 study is outdated; an executive referencing the 40% from Danske is using internal, unverified measurement in a field where perception and timing have diverged before.

Where the Cuts Fall on the Map

For a bank like Danske, the more pertinent question is not how many jobs AI eliminates, but where. Woelders mentioned that the bank works with about 2,000 people through the Indian Infosys, which took over Danske's IT center in Bangalore under an outsourcing contract in 2023. They do not appear on the bank's payroll. If developer output does indeed double by 2028, the contracted capacity of suppliers is the simplest lever to adjust: it does not require negotiations with the Danish union nor generate headlines in Copenhagen.

The same reasoning applies to the bank's own centers outside Denmark. Since 2012, Danske has maintained a global service center in Vilnius, Lithuania, serving IT, risk management, compliance, HR, and customer service, according to the investment agency Invest Lithuania. In Warsaw, the bank operates what Disruption Banking describes as its largest international technology hub. Both centers were created to absorb technical and operational work at scale, precisely the type of tasks that code agents and back-office automation are beginning to take over.

The Nationalbank's study measures the effect of AI on the Danish labor market, which is flexible and highly digitalized. However, adjustments for a Danish bank could largely take place outside Denmark, in Bangalore, Vilnius, and Warsaw, and no national statistics from Copenhagen will capture it. The central bank's calmness and Woelders' forecast could both be correct at the same time.

For consultants selling engineering capacity to European banks, the interview serves as a pricing signal. A client expecting to double output per developer by 2028 has little incentive to continue paying for each allocated person, and contracts tied to delivery are becoming the currency of renegotiation. Infosys, with around 2,000 people working for Danske, is one of the first suppliers exposed to this discussion. The impact on Bangalore, Vilnius, and Warsaw will depend less on the technology itself and more on who, at the negotiation table, captures the productivity gains.