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KPMG’s Insights into Canadian Banking looks at accelerated transformation

By Rob Starr Content Manager

In today’s modern digital world, any financial institution that wants to stay solvent and increase their profitability needs to have an eye on cyberspace. This is especially true when it comes to customer loyalty and retention and breaking through traditional barriers by embracing technology and big data capabilities in this area is one of the focuses for KPMG’s Insights into Canadian Banking.

Lian Zerafa,  KPMG Financial Services Partner In Canada , started a discussion with with a common subject, analytics.

“The general idea is about improving the customer experience and creating a customer

Lian Zerafa

centricity which historically hasn’t existed in the banks,” he said. “In terms of customer satisfaction, analytics ties more deeply into loyalty management.”

Target services

Zerafa says the ultimate goal is to create a 360⁰ view of the client through all interactions. Collecting this data is also useful for creating more targeted services. Zerafa points out there are three main focus areas in the process that starts with data analytics.

“You’re seeing big data being collected and that ties into deriving the experience and even designing the way that products are marketed.”

He also points out that business has taken the lead and there is evolution away from IT forcing the agenda. Still, he says not everything in the digital world has an immediate ROI stating that, “Sometimes it’s just a stay in business proposition and keeping up with the juggernaut that is the mobile experience.”
Mark Smith, a KPMG National Financial Services Leader in Canada , spoke to the constantly evolving regulatory mandates and compliance requirements faced by Canadian banks highlighted in the report.

“We’re at the beginning of the journey or the middle of the journey, take your pick,” he said, “but

Mark Smith

there’s going to be no letting up in the regulatory requirements that are faced by Canadian banks.”

He makes a point of stressing the evolution of these requirements and mandates is completely different depending on which side of the border you’re on.

“Because of the different consequences and reactions of 2008, the Americans have different benchmarks like when planning capital requirements.”

Canadian Borders

Within Canadian borders, we talked about the fact that bank supervisors in other countries are now looking to exert local control and bumping up against Canadian domiciles that are regulated by off shore interests. This results in competing priorities between different supervisors and some corresponding tension. The more global the bank, the more the situation crops up.

“That’s why some banks believe very strongly in insourcing where they handle most of their tax operations themselves,” Smith said adding other Canadian banks have a very small core team in that area and use other providers like KPMG and the Big Four.

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