Good morning.

Thank you. I’m delighted to be here today and I’d like to thank Wendy Rinella for extending the invitation. I really appreciate that all of you from the Chamber of Commerce came out this morning. It’s also a real pleasure that Terence Young, your Member of Parliament, and Kevin Flynn, your Member of Provincial Parliament, could join us.

The last time I attended a Chamber of Commerce event in Oakville was back in June, when Stephen Poloz gave his first speech as the new Governor of the Bank of Canada.

As you no doubt recall, the turnout was so large the event had to be moved to Burlington to accommodate the crowd. I’m glad that I didn’t have to put you to all that trouble.

I grew up in the Town of Oakville in the 1960s and since my day, this community has grown exponentially, becoming a dynamic driver in the regional and provincial economy. That’s a powerful testament to the success of the Oakville Chamber and the environment you have created to attract and support business members of all sizes and shapes.

Ford Canada’s recent announcement that it will invest $700 million to expand and re-tool its plant here is a strong endorsement of that business-friendly environment. But there is also a remarkable range of small and medium sized companies in the area – as well as excellent resources for them to draw upon.

Financial institutions, including banks, are among those resources. With 42 bank branches in Oakville, customers in this town are well-served. I’ll come back to this shortly.

Oakville is also a very desirable place to live and 2,800 bank employees and their families call this town home. Whether they work here in town or commute elsewhere, they are active members of their home community, many of them volunteering their time in a variety of local activities and programs.

This morning I want to talk with you about banks and banking, not just from my perspective as the president of the Canadian Bankers Association, but also from the experience of the customer. And all of you in the audience are customers – either as business people or as individual consumers – and I hope that what I have to say reflects your overall banking experience. We have a Q and A session at the end so you can tell me if I’ve got it right.

Here are the general themes that you will hear throughout my remarks:

I’m going to talk about competition – there is a great deal of discussion these days about the level of competition in different sectors of the economy, and I’m going to offer some perspectives about competition in Canada’s banking industry.

I’m also going to talk about choice – and how competition results in an abundance of choice for the customer.

I’ll also talk about security and trust – something that is at the core of banking for our customers.

And, I’m going to talk about innovation – – everyone in this room will have an image in their mind when they hear the word “bank”, but I want to suggest to you that in many ways banks in Canada should actually be viewed as technology companies. That’s because of the huge investment that banks make in developing and deploying technology across all aspects of their operations. But innovation is much more than the latest technology – innovation is a focus on continuous improvement across all fronts of our customer service.

Those are my themes for this morning.

Those are the themes I will be talking about today.

Canada’s strong, sound banks – benefitting customers

Let me start by talking about our banking system compared to those around the world.

One of the hallmarks of Canada’s banks is that they are strong and sound. We all know that banks in many other countries didn’t weather the global financial crisis very well – many collapsed and others needed government bailouts.

By contrast, our banks have been recognized as the soundest banks in the world by the World Economic Forum – for six years in a row. This is something that our industry is very proud of, and it’s something that Canadians across the country have recognized. Canadians know that there have been problems with banks in other jurisdictions, and that those problems were major contributing factors to the economic downturn and lack of growth that those countries have experienced.

Canadians recognize that we have banks that are there when we need them. We have banks that we can depend on – depend on for keeping our deposits safe; depend on for loans to buy a home or grow a business; and depend on for investment advice for retirement planning.

Stated another way, you can’t provide customers with the products and services they need if you don’t have strong, sound and profitable banks – and we have that here in Canada.

Let me put some numbers behind this claim, with a specific focus on our business customers.

Here, in Quebec, businesses of all sizes have benefited from this financial stability. Since 2009 (when the global financial crisis was in full swing) to last September, the amount of credit that banks made available to businesses in Quebec increased by $24 billion.

Businesses of all sizes have benefited from this financial stability. Since 2009 (when the global financial crisis was in full swing) to June of this year, the amount of credit that banks made available to businesses increased by $190 billion to more than $895 billion.

And when we look at small and medium-sized enterprises specifically, banks increased the amount of available credit by 20 per cent between 2007 and the end of June this year.

These are positive numbers, but they only become meaningful when compared to the situation elsewhere. So let me provide a telling example. In 2011 (the most recent statistics from Industry Canada’s small business demand survey) close to 90 per cent of small business loan applications were approved – and let’s remember that’s was a time when the economy was still fragile and barely growing.

Compare that to the United States where the small business approval rate by large banks in the U.S. in same year, 2011, ranged between 9 to 13 per cent. I think our numbers tell a very positive story about bank lending to businesses in this country.

During the global financial crisis, individual Canadians – and Canadian businesses – got a better sense of how their financial service sector operates, as well as a crash course in why having strong, sound banks matters to them directly and to the broader domestic economy.

That’s reflected in the feedback from our public opinion research:

92 per cent of Canadians say they believe that sound, profitable banks help protect their deposits and provide them with credit.

And almost 90 per cent believe that stable banks are better able to compete internationally and to help them – and their businesses – do the same.

Banks are responsive to the needs of customers

Being strong and sound is only part of how our banks are there for Canadians. Banks must also keep pace with the demands of customers. And banks in Canada have been doing just that.

Let me share some thoughts on how the banks are adapting to the way their clients live and work.

Whatever the size and scale of your business, it’s always critical to be innovating on all fronts of the customer experience. Whether it’s in the use of new technology or in-person in the familiar retail space, you have to be constantly re-balancing to keep pace with changing demands. It’s as challenging for Canada’s banks as it is for everyone in this room.

So how do banks contend with this challenge?

First, they invest billions of dollars – over $56 billion since 2003 – in technology every year to keep pace with the changing needs of their clients – and to stay ahead of the competition.

Let me talk for a moment about those changing needs. Our research shows that just under half of Canadians – 47 per cent – use the internet as their preferred method of banking, up from just eight per cent 12 years ago. Banks are leading this change by providing Canadians with the convenience of banking when and where they want. And, by providing the security that Canadians trust so much.

Further, almost 20 per cent of Canadians are already using their smartphones to do their banking. And that’s expected to grow to 35 per cent in the very near future, particularly as we move further into the mobile payments market, where you use your smartphone to pay for things at the checkout. Banks are continuing to offer leading edge innovations in mobile technology. Technology that is accessible, affordable, and aimed at making life more convenient for customers. And again, I want to stress that this is technology that is secure – Canadians have trust in their banks, and know that they are protected if and when something goes wrong.

But meeting our customers’ changing needs isn’t just a question of the mobile or on-line environment. Banks are also constantly innovating in places where banking is more familiar. Let’s look at the branch environment, for example.

I just used the term “branch”, but what I’m really talking about are retail settings aimed at providing excellent customer service. Some call them stores, some call them cafes, but the idea is to provide a flexible, consumer-friendly environment that is welcoming and accommodates different physical needs of customers, and to do this on extended hours and weekends.

But meeting our customers’ changing needs isn’t just a question of the mobile or on-line environment. Banks are also constantly innovating in places where banking is more familiar.

One thing that hasn’t changed, however, is the personal aspect, the relationship aspect. Yes, customers want to be able to access their accounts online or at the ABM, but for some products and services – whether it’s for a home mortgage or a business line of credit or investing for retirement – there still is a highly personal component to financial transactions. Those “hopes and dreams” conversations are the connective tissue of commerce and many people prefer to have those discussions face-to-face.

And here again, there is a constant evolution in how we are serving the customer. The range of services and options available at a branch has expanded considerably to meet a much broader range of customer needs – customers nowadays are looking for much more than simply executing transactions; they are looking for expertise and advice. And that’s why there are 42 branches here in Oakville and more than 6,200 across the country.

And it isn’t just the case of customers coming to the branch. Many of our members will bring the branch to the customer where it’s convenient and comfortable for the customer to meet. Across the country, you will find financial advisers meeting customers at their home or at a local coffee shop, agriculture lenders meeting farmers on the farm, and business bankers providing advice and services on the shop floor.

Our clear sense is that Canadians recognize that they are getting value for their money. They understand and appreciate the convenience and the accessibility they have to bank services.

Again, statistics from our public opinion research bear this out:

  • 91 per cent of Canadians appreciate being able to bank at a time that’s convenient;
  • 81 per cent value access to their accounts from virtually anywhere; and,
  • 77 per cent are happy to avoid the time it takes to travel to their branch on a regular basis.

Competition in banking means choice for customers

Looking at the bigger picture, this dual-pronged strategy of providing leading-edge technology while continually improving the face-to-face banking experience is at the heart of an exceedingly competitive banking sector in Canada.

There’s intense competition to attract and to retain customers over the long-term. At the same time, consumers are more informed and empowered than they have ever been. They have unprecedented choice and they know how to use it to their advantage. So let me talk a bit about choice.

When it comes to financial services, Canada has 80 different banks, 40 of which provide services to retail customers. And that’s not including credit unions, trust companies, and other financial services players, all of whom are vying for a share of the same market.

Frankly, you’d be very hard pressed to think of any other sector where there is as much real competition and where consumers have such clout – as well as the means to use it.

Just pause for a minute and think about all the national brand names in other industries that market to consumers – be it groceries, hardware, telecom or pharmacies – and compare the level of competition in those sectors to the amount of competition we have in banking. Our customers have incredible choice. They are in the driver’s seat.

The irony is that the consumer technology that the banks have invested in so heavily, is precisely what makes it easier than ever before to move your business from one financial institution to another. It’s not too much more than a click of a button, something the banks are all acutely aware of because they designed and provided that button.

As a result, four million Canadians have switched primary banks over the past five years and 70 per cent of those who did so said it was easy. That data was included in a study just released by EY (the consultants formerly-known as Ernst and Young).

It’s a figure that sets a very high bar for customer experience and satisfaction.

It means that however cost-effective it may be to implement a simple, one-size-fits-all approach, it’s not a strategy that will succeed. At least not in the face of such fierce competition.

What that means is that customers can find products, services, and packages tailored to their needs.

Currently, almost 30 per cent of Canadians pay no monthly service fees, 34 per cent pay less than $15, and youth, students and seniors have access to discounted or free accounts. The major banks all offer low fee accounts. You can pay a little and just get the basics or you can pay a bit more and get more value-added services. It’s all about what you want as a consumer. And that story is replicated throughout the range of banking products and services on offer to customers.

Just look at credit cards and the range of offerings for customers. You can’t open a newspaper without seeing all the various ads for the different credit cards offered by banks. Whether it’s plain vanilla low-cost cards, or cards that offer points and rewards, there’s a card for every profile of consumer in the country.

With so much competition in the marketplace, what have Canadians been telling us about their impressions of banks?

Today, 86 per cent have a favorable impression of banks – up from just 59 percent in 2001. That’s a huge leap.

And when asked about their own bank, 96 per cent have a favorable impression, something that carries a lot of weight in a competitive business.

Taking care of customer complaints

While I’ve focused on the innovation, competition, choice and security in banking today – all of which is customer driven – there is something else that banks do well when it comes to their customers: providing them with a clear, fair, simple, and free process for resolving complaints.

TThink about it: More than four billion customer transactions flow through the six largest banks each year, that’s more than eight thousand every minute of every day. The vast majority of these transactions are completed without incident and to the satisfaction of the customer. That’s quite an accomplishment when you think about it and it reflects a very high standard of performance and execution.

Nevertheless, whenever there’s that kind of volume, there will occasionally be complaints. When these arise, there’s a transparent, simple process available free of charge to customers to help resolve those issues. It starts internally and if the banks can’t resolve it, the final step is with an independent third party.

It’s easy to find where to turn to get this help – it’s all online and the contacts and criteria are clearly spelled-out. Again, think of other service industries and whether they match this commitment to customer complaint resolution. I think even governments look with envy at how few complaints from bank customers end up referred to a third party resolution process.


I know we all have day jobs to get to this morning so I’ll conclude my remarks.

I’ve presented to you the banking experience from the customer point of view. I know that occasionally there will be situations that don’t fit with what I’ve said. But overall, it is clear that bank customers in Canada have a very different, and very positive, experience from bank customers in many countries around the world.

Bank customers in this country want ample choice provided by trusted providers in a competitive marketplace. They want innovation as well as confidence and security in their relationship with banks. And they want a fair and simple process to take care of problems should they occur. My comments today have been about how our banks deliver on all these.

With the intense competition among Canada’s banks, they are listening to their customers. They are also in fighting form – wanting to keep their customers by keeping them satisfied.

In short, they want your business. And they are steady on their feet to help Canadian business leaders, like you, stay on yours.

Thank you. I look forward to your questions.