The overall competitive landscape has been reshaped, with the boosted opportunities for businesses driven by artificial intelligence (AI). The banking sector is no exception. “The new winners of the game” will be neither the classic nor the digital banks but the ones rapidly and effectively implementing the intelligent framework. The continuous growth of the banking system and its role in the financial system of Armenia, within the pace of AI innovations, raise the need for this research. This research aims to examine the role of AI in banking, identify its potential applications, and highlight the main associated risks. Within the research, the authors identified possible applications of AI to banking activities through observations and expert methods. The comprehensive assessment of AI applications in banking has been performed through SWOT analysis. The research specified the potential application of AI in banking operations such as financial analysis, personalized customer service, creditworthiness assessment, support center, fraud detection, risk management, cyberattack prevention, and customer service automation. The data privacy and security risks, subjectivity and ethical risks, operational and model risks, compliance risks, and third-party and legal risks in the process of applying AI in banking activities are the main risks highlighted in the framework of the research. Summarizing the results of this research, the conclusions and recommendations section presented the main advantages and disadvantages of using AI․