Bank setting up AI lab in new centre in Mile Ex
Technology is part of firm’s strategy to reach customers in new ways
When RBC launches the Montreal branch of its artificial-intelligence initiative, it will be in the heart of a new AI centre announced last week in Mile Ex.
“We know Montreal is a huge hub of AI and technology and attracts a lot of interested parties outside of Montreal as well,” said Nadine Renaud-Tinker, the president of RBC in Quebec since December.
Investing in AI is part of the bank’s strategy to reach customers in new ways and at new times as their banking patterns change, she said.
First launched in Toronto and Edmonton in 2016, Borealis AI is RBC’s AI research lab. The Montreal location will be at the corner of St-Urbain and St-Zotique Sts, where an area formerly dominated by textile factories is being turned into an AI hub. The bank has partnered with Jackie Cheung, a McGill University professor, who will serve as its academic adviser.
Renaud-Tinker said she isn’t sure quite how AI will shape banking but she sees the potential.
“I think it’s going to evolve — this is the baby stage,” she said. “There’s so much going on in the AI space. There’s so much that can be done that will evolve over the next couple of years.”
“Nobody really knows what the future holds 20 years from now” in banking, Renaud-Tinker said.
Among the changes they’re facing at the moment: customers aren’t coming into branches as often and financial-technology, or fintech, companies are offering services that were once the exclusive domain of banks.
Renaud-Tinker said RBC, which has 1.8 million customers in Quebec, is adapting to the shift by changing what the bank invests in — such as the AI lab — and the way it reaches its customers.
“We’ve had about six per cent traffic down year over year over the past couple of years (in our branches), so that’s pretty significant,” she said. “And you’ve got to think about how you’re going to reach out to all these clients who are no longer coming in. The younger generations will not do a mortgage in a branch, for example. They will never walk in.”
So when customers fill out a mortgage application, she said, the bank will try to reach them by phone or email.
The way the company ’s employees in Quebec do their jobs is also changing. When Renaud-Tinker started working at RBC 20 years ago, as a customer service representative, branch employees (who still make up the majority of the company’s workforce in Quebec) generally did one job.
“Retail banking is not slowing down, it’s evolving. We have 7,000 employees and we’re not cutting jobs, we’re developing people in a different way,” she said. “The people in the branch are no longer doing one thing, they ’re doing five different things.”
The bank is also expanding its use of mobile specialists, like investment advisers, who go out and visit clients, rather than wait for customers to come in.
She sees that strategy — focused on a full-service approach — setting the bank apart from new entrants.
“The fintechs are going to do what the fintechs are going to do, but where there’s a value proposition in an RBC world is really being able to offer all the service and the advice under one roof for our customers, no matter what area you come from,” she said.
There are some clouds on the horizon. Changes to NAFTA and higher interest rates could slow the economy, but Renaud-Tinker, who spent much of her career in Toronto before returning to Quebec two years ago, is optimistic about the province and the city’s economies as she looks to grow the Quebec division’s assets from $100 billion to $150 billion over the next five years.
“We have entrepreneurs that have incredible plans, we have a province that’s attracting talent, we have some of the best universities in the country . ... It’s becoming the city that I think it used to be,” she said.
“I see it because I left for almost 16 years. To come back and see today what it is versus what it was 17 years ago is really amazing.”