Royal Bank of Canada is prioritizing investments in technologies like AI and gen AI to improve operations and drive customer engagement. 

The $1.4 trillion bank aims to roll out AI solutions to counter cybersecurity threats in the coming quarters, Chief Executive David McKay said during today’s fiscal fourth-quarter earnings call. 

Toronto-based RBC is investing in gen AI technologies for data-based insights to anticipate client needs and provide them with products promptly, according to its annual report, published today. The company is investing in cloud technology to safeguard itself from cyber threats, the report notes. 

The bank reported non-interest expenses of CAD $9 billion ($6.4 billion), up 12% year over year during its fiscal Q4, which ended Oct. 31. The increase was driven by higher investment in technology and personnel, McKay said. 

THE BIG PICTURE: RBC joins its Canadian bank peers in increasing investments in technology during the quarter. 

The $454 billion National Bank of Canada reported a tech spend of $135 million, up 15% YoY partly driven by the integration costs of its acquisition of Canadian Western Bank for $5 billion announced on June 11, Chief Executive Laurent Ferreira said during the bank’s Q4 earnings call today. 

Scotiabank also reported an 8% YoY increase in Q4 tech spend to $610 million, driven by investments in cloud technology and cybersecurity. 

BY THE NUMBERS: In Q4, RBC reported: 

• Revenue of $10.7 billion, up 19% YoY; 

• Net interest income of $5.4 billion, up 17% YoY; and 

• Net income of $2.9 billion, up 7% YoY. 

OF NOTE: RBC expects to save $541 million through its acquisition of HSBC Canada by the end of 2026 and has saved $159 million in 2024, it stated in the earnings report. 

“HSBC is well on track to deliver on the bottom-line impact of [$1 billion] upside from the revenues that we’ll get from cross-sell,” McKay said, adding that HSBC will be a big part of RBC’s growth in the coming years. 

Editor’s Note: All figures converted to USD. 

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