The Toronto Star, Tara Perkins, 14 September 2006
The Royal Bank of Canada is in talks with global banks that operate in India to sign a cross-referral deal, one of numerous steps Canada's biggest bank is taking to woo newcomers to Canada.
As this country's big banks fight for new customers, immigrant communities have become a major battleground.
And rather than wait for new Canadians to land in the country, the banks are taking steps to win them over before they've even set foot on Canadian soil.
"We are in far-advanced discussions with a number of key global partners that are already established in India to look at a cross-referral agreement," Dave McKay, RBC Financial Group's head of personal banking, said in an interview.
"In the absence of any branch network for RBC in India, we are looking at other partners who might help accelerate our plan," he said.
An agreement would see the partner in India refer people who are thinking about emmigrating to Canada to the Royal.
It would be RBC's first cross-referral agreement, said McKay, who added that the bank is now allowing non-residents of Canada to open accounts.
The move is part of Royal's broader strategy to boost its business from new Canadians. Chief executive Gord Nixon and other executives outlined that strategy at a luncheon yesterday for about 35 members of the Chinese and South Asian media.
The meeting comes about a month after BMO Financial Group announced it was buying bcpbank Canada, the Canadian arm of Portugal's Millenium bcp, saying the chance to provide multicultural financial services is "one of the biggest business opportunities" out there.
In November, the Bank of Nova Scotia — which has the largest international operations of Canada's big banks — bought the 10 Canadian branches of the National Bank of Greece.
"This has become a bit of a theme," said Genuity Capital Markets analyst Mario Mendonca, who noted that statistics and history show that immigrants become more affluent over time, making them an attractive customer segment.
Nixon bristles at the suggestion Canada's banking market is mature with limited opportunities for growth, citing as an example the opportunity to boost wealth-management offerings as the baby boomers age.
But, "if you look at the pure growth of customers, a large percentage of new customers will come from immigrants, new Canadians, aboriginals, different cultural groups," he said in an interview.
"And I think the ability to find ways to really do a good job servicing those cultural communities will really be a differentiator in terms of growth. And it's one of the reasons I think all the institutions are paying a lot of attention to this sector," he said.
RBC's Beijing office was upgraded to branch status this year, and it attempts to attract some of the 35,000 immigrants who come from China to Canada each year. Shanghai would be an obvious location for a new branch, but no timetable has been set for potentially opening one there, Nixon said.
RBC launched a Chinese-language section of its website for new Canadians in December, and by April, traffic to the "Welcome to Canada" site had increased tenfold, from 500 hits a month to 5,000, McKay said.
"We have opened hundreds of accounts online and it's growing at a very strong clip," he said.
RBC also has developed a proprietary credit-approval system that allows new immigrants to obtain mortgages and credit cards without a Canadian credit history, Nixon said, and he's hoping to expand that ability into areas like wealth-management products.
Meanwhile, a large number of the 50 branches RBC is opening in the Greater Toronto Area over three years will be located in areas that contain a high concentration of Chinese and South Asian new Canadians, such as Markham and Richmond Hill.
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The Royal Bank of Canada is in talks with global banks that operate in India to sign a cross-referral deal, one of numerous steps Canada's biggest bank is taking to woo newcomers to Canada.
As this country's big banks fight for new customers, immigrant communities have become a major battleground.
And rather than wait for new Canadians to land in the country, the banks are taking steps to win them over before they've even set foot on Canadian soil.
"We are in far-advanced discussions with a number of key global partners that are already established in India to look at a cross-referral agreement," Dave McKay, RBC Financial Group's head of personal banking, said in an interview.
"In the absence of any branch network for RBC in India, we are looking at other partners who might help accelerate our plan," he said.
An agreement would see the partner in India refer people who are thinking about emmigrating to Canada to the Royal.
It would be RBC's first cross-referral agreement, said McKay, who added that the bank is now allowing non-residents of Canada to open accounts.
The move is part of Royal's broader strategy to boost its business from new Canadians. Chief executive Gord Nixon and other executives outlined that strategy at a luncheon yesterday for about 35 members of the Chinese and South Asian media.
The meeting comes about a month after BMO Financial Group announced it was buying bcpbank Canada, the Canadian arm of Portugal's Millenium bcp, saying the chance to provide multicultural financial services is "one of the biggest business opportunities" out there.
In November, the Bank of Nova Scotia — which has the largest international operations of Canada's big banks — bought the 10 Canadian branches of the National Bank of Greece.
"This has become a bit of a theme," said Genuity Capital Markets analyst Mario Mendonca, who noted that statistics and history show that immigrants become more affluent over time, making them an attractive customer segment.
Nixon bristles at the suggestion Canada's banking market is mature with limited opportunities for growth, citing as an example the opportunity to boost wealth-management offerings as the baby boomers age.
But, "if you look at the pure growth of customers, a large percentage of new customers will come from immigrants, new Canadians, aboriginals, different cultural groups," he said in an interview.
"And I think the ability to find ways to really do a good job servicing those cultural communities will really be a differentiator in terms of growth. And it's one of the reasons I think all the institutions are paying a lot of attention to this sector," he said.
RBC's Beijing office was upgraded to branch status this year, and it attempts to attract some of the 35,000 immigrants who come from China to Canada each year. Shanghai would be an obvious location for a new branch, but no timetable has been set for potentially opening one there, Nixon said.
RBC launched a Chinese-language section of its website for new Canadians in December, and by April, traffic to the "Welcome to Canada" site had increased tenfold, from 500 hits a month to 5,000, McKay said.
"We have opened hundreds of accounts online and it's growing at a very strong clip," he said.
RBC also has developed a proprietary credit-approval system that allows new immigrants to obtain mortgages and credit cards without a Canadian credit history, Nixon said, and he's hoping to expand that ability into areas like wealth-management products.
Meanwhile, a large number of the 50 branches RBC is opening in the Greater Toronto Area over three years will be located in areas that contain a high concentration of Chinese and South Asian new Canadians, such as Markham and Richmond Hill.
