The study investigates the impact of artificial intelligence (AI)-powered chatbots on brand dynamics within the banking sector, focusing on the interrelationships between AI implementation and key brand dimensions, including awareness, equity, image, and loyalty. Using structural equation modeling (SEM) analysis on data collected from 520 banking customers, the study tests eight hypotheses to explore the direct and indirect effects of AI-driven interactions on brand development. The findings reveal that AI chatbots significantly enhance brand awareness in banking services, demonstrating moderate positive effects on both brand equity and brand image. Notably, while brand awareness exerts a strong influence on brand image, it does not have a significant direct effect on brand loyalty. Instead, the study shows that brand loyalty is primarily developed through the mediating effects of brand equity and image, with brand image exerting a particularly strong influence on brand equity. For banking practitioners, these insights suggest a need to integrate AI chatbots within a comprehensive brand strategy that merges technological innovation with traditional relationship-building approaches. Limitations of the study and potential directions for future research are also discussed, providing avenues for further exploration of AI’s role in brand management.