Scotiabank CEO Scott Thomson says artificial intelligence saved his bank roughly 24,000 days’ worth of work over about four and a half months. At TD Bank, CEO Raymond Chun recently said AI has reduced the time it takes to pre-process mortgages from about 15 hours to three minutes.
Canada’s Big Five banks employ nearly 400,000 full-time-equivalent workers. That’s more than double the number of employees in Canada’s auto assembly and parts manufacturing industry. TD Bank workers alone outnumber Canada’s active military force.
According to a study by Toronto Metropolitan University, 98 per cent of financial sector workers are highly exposed to AI technologies. That’s far higher, they say, than the 56 per cent estimated for the Canadian workforce overall.
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Last month, the Bank of Canada estimated that one‑third of jobs may “undergo substantial changes” because of AI integration, given today’s capabilities. The central bank found that banking, insurance and other financial clerks are among the most exposed.
“AI is a big opportunity for us, a transformational opportunity both from an effectiveness, and an efficiency perspective,” Thomson said on Wednesday at the annual Scotiabank Financials Summit in Toronto.
His enthusiasm is shared by his C-suite peers.
“There isn’t a part of our business that’s not being impacted by AI,” RBC CEO Dave McKay told an audience at an industry conference hosted by his bank earlier this year. At an event in June, he spoke about using AI every morning to generate custom reports based on RBC’s internal data.
Last month, BMO CEO Darryl White said predictive AI modelling in his bank’s insurance business can make underwriting decisions in as little as 10 seconds. The industry standard is at least 28 days, he noted.
Stock market analyst John Aiken covers the banking industry for New York-based Jefferies Financial Group. He sees top executives at Canada’s Big Five — Royal Bank, TD Bank, Bank of Montreal, Scotiabank, and National Bank — brimming with excitement over the billions of dollars they’ve invested in AI in recent years.
What’s unclear, he said, is how rank-and-file bank employees will feel the impact.
“This isn’t a little pet project,” Aiken told CBC News. “The funny thing is, it’s the CEOs themselves that are bringing it up unprompted.”
“Strangely enough, we’re not seeing headcount reductions from the banks,” he said. “You’re presumably going to see lesser demand for lower skilled workers … the front-line staff at the branches.”
Questions about how AI will affect some of Canada’s largest private employers come amid a much broader debate over how the technology could shape humanity as a whole.
Earlier this week, an artificial intelligence researcher quit his job at Anthropic, accusing the company, and its chief rival, OpenAI, of irresponsibly “racing straight to self-improving superintelligence.” On Tuesday, another Anthropic employee wrote on the social media platform X that, “we really do earnestly believe AI could kill all humans! I personally think it is >10% within the next decade.”
On Wednesday, federal AI Minister Evan Solomon said “there are real concerns” at the frontier of AI development
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Jon Pinkus, a partner at Samfiru Tamakin LLP who specializes in employment law, sees jobs at risk throughout the white-collar world because of AI. However, he said he has yet to see a clear-cut instance of humans being replaced.
“I have real generational anxieties for the incoming workforce. Not just this generation, but for generations to come,” he said.
“I think there are going to be certain positions that just don’t exist, particularly more junior positions, entry-level positions,” Pinkus said.
“A lot of those entry level tasks are the ones now being done by AI … [it does] them well enough for many organizations to say, ‘Why are we going to pay this person $80,000 per year?'”
Jeff Lanthier, director of media relations at RBC, told CBC News in response to questions about AI’s impact on the bank’s headcount that people and relationships will always be at the core of the bank’s strategy.
“We see AI as an enhancement, not a replacement,” Lanthier said.
The other Big Five banks did not respond to requests for comment in time for publication.
At its investor day last year, RBC announced plans to generate $700 million to $1 billion in enterprise value through AI-driven benefits by 2027. TD Bank is similarly targeting $1 billion in annual value from its artificial intelligence initiatives. Both banks have in-house AI research labs, called RBC Borealis and Layer 6, respectively.
CIBC CEO Harry Culham said his bank’s new AI workspace is more like a “co-worker” than a chatbot. Even so, he predicts the bank will add employees overall.
“We actually see headcount growth over the next five years,” CIBC CEO Harry Culham said on his bank’s Aug. 27 earnings call with stock market analysts. “We’re using it all over the entire organization, and we’ve got thousands and thousands of people being educated.”
Kiridaran Kanagaretnam, an associate dean at York University’s Schulich School of Business, sees the Canadian banking industry’s overall headcount drifting higher, absent a major financial crisis.
He recommends students pursue professional designations in accounting and finance to boost their value to employers.
“Everything is changing at a rapid rate,” he said. “But that doesn’t mean things are bleak.”
