Claude Code and the entire harness has actually evolved really great but the biggest risk is of the real sensitive data leaking to the hosted LLM elsewhere out which is not under the direct control of the bank in itself, though how much ever gaurdrails or content filters can be put in, any inline system performing full inline scanning of the request and response payloads will add to the TTFT and TPOT of the Inferencing.

The right way is to move to hosted models which are completely airgapped sovereign AI Factories and thats when AI can be extremely glorious. Thats how the Indian and EU Ecosystems are evolving to