Danske Bank extends AWS agreement for next phase of transformation

Danske Bank has extended its contract with Amazon Web Services (AWS) to focus on artificial intelligence (AI)-enabled customer services after the first phase of the agreement saw it build cloud and data foundations.

As part of its Forward ’28 strategy, which includes its digital transformation plans, Danske Bank began working with the US cloud supplier in 2024.

The first phase of the work saw the bank and AWS build a migration platform that has been used to move legacy applications to the cloud. The latest deal will see the bank harness the provider’s cloud, AI and engineering resources to develop digital customer services.

“Under the new agreement, Danske Bank will partner with AWS to modernise IT systems, strengthen its cloud and data foundations, and optimise how technology is developed and delivered,” said the bank.

Frans Woelders, chief operating officer at Danske Bank, said: “We are already seeing the benefits in how we develop the products and services our customers want, and I expect that value to grow further.”

The bank said it would increase “co-innovation” with AWS after the success of coordinated work to develop the platform used to migrate data from legacy systems to the cloud. “That same approach is now being applied to key generative AI [GenAI] initiatives,” it said.

Tanuja Randery, managing director of EMEA at AWS, said the first phase focused on building cloud and data foundations to support Danske Bank’s “bold ambition”.

The new agreement will bring Amazon’s Bedrock and Bedrock AgentCore into the fray to power AI-enabled banking services.

Amazon Bedrock is a machine learning platform used to build GenAI applications on the AWS cloud computing platform. It uses foundation models to simplify the creation of apps and make the process more efficient.

“Danske Bank will have access to hundreds of AI models, enterprise-grade data protection, and a fully managed platform that scales from experimentation to production,” said Randery.

The banking industry is leading the way in terms of enterprise AI adoption. According to Lloyds Banking Group’s Financial institutions sentiment survey for 2025, banks are gaining huge benefits from AI, stating that 59% of surveyed firms reported AI-driven productivity gains in the past 12 months, compared with 32% in the 2024 survey.

The focus on developing AI-based customer services takes Danske beyond using AI to save time and cost. While banks can save huge amounts in operating costs through AI, they must use it to improve customer experiences and offerings or face reduced profits. According to McKinsey’s latest report, while AI savings could be up to 20%, taking into account the cost of the technology banking industry profits could fall by 9% as customers move money based on AI agent recommendations.

“The impact of savings, while welcome, won’t last,” said McKinsey. “As with earlier innovations, competition will likely erode the gains for banks and most of the benefits will accrue to customers over time.”

With the wider finance sector also embracing AI, AWS is expanding its customer base. Earlier this month, Pennymac Financial Services also extended an existing deal with the tech giant to access GenAI tools as part of its plan to “change how mortgages are made”.