A collection of articles highlighting RBC’s activity over the last year on our site. At the end of this pagebook, you’ll find relevant metrics including time on site and the number of visitors.


RBC in the News - 2016

A collection of articles highlighting RBC's activity over the last year.



Blockchain revolution’s next stop is Canada

If Canadian regulators don’t already have their eyes on blockchain, that should change, because blockchain is coming to Canada sooner than they’d think, according to a new report from the C.D. Howe Institute.

The report, dubbed Blockchain Technology – What’s in Store for Canada’s Economy and Financial Markets? and authored by Thorsten Koeppl, an associate professor and RBC fellow at Queen’s University, and Jeremy Kronick, a senior policy analyst, is intended to outline the potential of blockchain technology and advise regulars on how to approach the challenges that this emerging technology entails.

“Blockchain technology has the potential to transform how a modern economy deals with maintaining and updating records, and has already created lots of turbulence in financial markets,” said Koeppl in the report. Kronick added, “The challenge for regulators is to balance letting markets figure out how to best use this technology while ensuring consumer safety and efficiency.”

The report covers three categories: potential applications of blockchain, the areas and industries that it has the most potential to be impactful in, and the priorities government regulators should focus on.

Koeppl and Kronick believe that the potential of blockchain exceeds that of a currency like bitcoin or a record-keeping system. They look at using blockchain for smart contracts and universal online identification systems as prime examples of this potential. Also included are concepts like cryptographic communication protocols and distributed data storage.

Ultimately the two authors have picked out four areas of potential: payment systems, smart contracts, corporate governance, and financial markets.

With blockchain, the report states that organizations can use this technology to modernize their infrastructure and offer clients safer and cheaper systems. Areas they believe will soon be able to make use of this technology include financial services, retail payment transactions, large-value transfers, and private equity markets.

“It will also be crucial to achieve safe and secure applications of this new technology without stifling innovation. In determining this balance, policymakers and regulators will have to decide whether to design rules and regulations along a principle-based methodology like was done with the internet in the 1990s, or whether to operate on a case-by-case basis,” the two state in the report.

As for what the government regulators in Canada should prioritize moving forward, Koeppl and Kronick suggest three main points of focus:

  1. Design a principle-based regulation regime that achieves high safety standards, legal certainty, and a stable environment for transactions based on distributed ledger technology.
  2. Ensure that this technology leads to appropriate end-user cost efficiences rather than simply a redistribution of above-normal profits among intermediaries.
  3. Determine areas where government involvement is advisable, be it in the role of facilitator for a private or public distributed ledger, or as a direct central node that applies elements of the technology but retains the monopoly of managing the ledger entries.

You can find the full report on the C.D. Howe Institute’s website.


Microsoft and RBC fueling new Canadian AI investments

Navdeep Bains with Microsoft team

One of Canada’s largest banks and a multinational software firm are both announcing expanded investment in artificial intelligence (AI) that will include partnerships with Canadian universities, according to announcements made Wednesday morning.

Microsoft Corp. just announced its acquisition of Montreal-based AI startup Maluuba Jan. 13 and now it says it wants to double the size of that team over the next two years. That investment will be paired with a $6 million gift to the Universite de Montreal and $1 million to McGill University to be spent on AI research over five years. The announcement was made by Microsoft President Brad Smith from the World Economic Forum in Davos, where he was joined by Navdeep Bains, Canada’s Minister of Innovation, Science and Economic Development.

“Microsoft’s investment is proof of Canadians’ world-renowned expertise in artificial intelligence and machine learning,” Bains is quoted as saying in a press release. “Research conducted in Canada will play a defining role in developing this enabling technology, which will create better jobs and opportunities for Canadians.”

The Royal Bank of Canada also announced new steps in building up its AI investments through its research arm, RBC Research. It plans to kick off a new AI lab and work with the Alberta Machine Intelligence Institute (Amii) at the University of Alberta to pursue research collaboration. RBC is also announcing that it’s hired Richard Sutton as head academic advisor to RBC Research. Sutton, a PhD holder, is known for his work in the reinforcement learning area of machine learning, according to RBC’s press release. That area can be useful in determining what an ideal behaviour in a complex environment might be and could prove useful in financial investment scenarios.

RBC didn’t specify a dollar amount attached to this announcement. When asked by IT World Canada, an RBC spokesperson said that the bank plans to invest “10s of million of dollars” over the coming years into AI. Last October, RBC announced a partnership with the University of Toronto’s Creative Destruction Lab and became a Founding Partner of the lab’s Machine Learning Initiative focused on AI-enabled companies. It also created an RBC Research in Machine Learning project that is housed at the University of Toronto and is headed up by Foteini Agrafioti, the co-founder and co-inventor of Nymi, a wearble device with authentication applications.

 


Tony Lacavera, RBC, Magna among backers behind new AI funding program

TORONTO – Tony Lacavera is putting his money where his mouth is.

The former Wind Mobile CEO, who sits on the board of startup-funding charity Next Canada, and whose venture capital firm Globalive Communications Corp. is one of its leading financial backers, served as master of ceremonies on Wednesday as Next Canada revealed the funding partners behind its latest initiative, NextAI.

Lacavera framed the new artificial intelligence (AI) startup funding program, which so far has received $5.15 million in financial support from a series of high-profile donors including Royal Bank of Canada (RBC), auto parts giant Magna International Inc., and Scotiabank, as the private sector’s contribution to such AI-friendly government- and education-backed organizations as the Canadian Institute for Advanced Research (CIFAR) and the Natural Sciences and Engineering Research Council of Canada (NSERC), which he said had provided Canada with a “small but fleeting competitive advantage” in the field.

“Despite excelling on the research front, in recent years the AI brain drain has become more and more profound, as so much of our top talent leaves for Silicon Valley and beyond,” Lacavera said during a Jan. 25 presentation. “At NextAI, our aim is to stop and reverse this brain drain and actually attract the best and the brightest from around the globe to Canada – and the only way we’re going to ensure Canada continues to make its way in artificial intelligence is if we make it the best environment possible for both creation and innovation.”

In an interview last year with IT World Canada sister site ITBusiness.ca, Lacavera argued that the federal government’s much-vaunted “innovation agenda” would only succeed if the private, public, and education sectors worked together while focusing on sectors in which Canada could excel – including AI.

“Many people think Canada’s been asleep at the wheel, but our governments and education institutions have actually quietly been investing in AI for decades,” he later IT World Canada. “We’ve established a leadership position. Now that the whole world is catching onto AI, we really need to solidify that position.”

As the name implies, NextAI will provide each of its first cohort’s participants with up to $200,000 in funding, access to state-of-the-art technology, mentorship from business leaders and scientists, and education from some of the field’s top academics, including experts from Harvard, MIT, NYU, the University of Guelph, and the University of Toronto. Their goal: to create commercially-viable AI companies – and help solidify Canada’s reputation as a global leader in the field.

“Artificial intelligence means a lot of different things to a lot of people, but whether it’s advanced robotics, whether it’s being able to analyze data and apply it to a solution like a human – which is what we’re looking for in autonomous driving – AI has a lot of applications,” Magna CEO Don Walker told IT World Canada.

From left: Magna CEO Don Walker and RBC President and CEO Dave McKay discuss the advantages AI holds for Canada’s economy with moderator Amanda Lang during a NextAI event on Jan. 25.

During a panel titled “A CEO’s Perspective,” Walker said that Magna, despite being viewed as a manufacturing company, is as much in the software business as the automotive business.

“There are more lines of code in a vehicle than there is in a plane body,” he told the audience. “We’re in a business involving sophisticated information, so we already use AI. There’s potential in every industry for AI.”

During the same panel, RBC President and CEO Dave McKay called AI a “fundamental” tool that Canada needs to harness in every industry it can if it wants to remain competitive into the 21st century.

“At RBC… [AI] is creating new capabilities for our customers,” McKay said. “We’re deploying it into our cybersecurity, we’re deploying it in brand management, we’re adding it to customer solutions, we’re integrating it into our operating environment… AI is a natural tool to help us become more efficient, be more effective with customers, and create a better experience overall.”

While the program itself is based in Toronto, NextAI is open to entrepreneurs and AI talent from around the world, with Lacavera noting that the first cohort’s 75 participants collectively represent more than 20 different countries, including Germany, India, Israel, Italy, and the U.S.

The program was developed last summer during an innovation brainstorming session sponsored by RBC and Magna, both of whom are serving as founding corporate partners along with BDC Capital and Scotiabank.

NextAI’s organizers have also formed technology sponsorships with IBM Canada, Google Inc., and Nvidia, which all contributed millions in hardware and services, and will provide participants with funding, corporate mentorship, and access to industry experts, customer trials, and data sets.

During another panel, titled “Investing in Canada,” Scotiabank executive vice president and co-head of IT and enterprise technology Michael Zerbs noted that Canada’s present AI ecosystem is stronger than many in the tech industry give it credit for.

“I think, frankly, sometimes we are too shy when it comes to talking about what we have in the Canadian ecosystem… whether it’s here in Toronto, or something going on in Montreal, Halifax, or B.C.,” Zerbs said. “We have this unbelievable ecosystem of… students who are totally motivated, and… all they need is a catalyst like NextAI, and corporate partners, like Scotiabank, who have a sense of purpose and initiative and know what AI can do. It’s all here.”

“We have a really fantastic opportunity, and we shouldn’t be shy about it,” he continued. “We shouldn’t beat ourselves up… We should talk about it… and execute it.”

“We should be less Canadian,” moderator Amanda Lang said.

“Exactly,” Zerbs replied.

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Tony Lacavera, RBC, Magna among backers behind new AI funding program


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RBC looks past Bitcoin’s flaws to consider blockchain strengths

Could the blockchain be the next technology to rock the financial sector? The Royal Bank of Canada (RBC) seems to think so – and it’s experimenting with the technology already.

Blockchain technology is the engine underpinning bitcoin, but it has been viewed separately from the cryptocurrency of late. Experts have begun to explore it as an independent technology for applications outside bitcoin. One of these is in finance and banking.

Adam Ludwin, founder of blockchain development company Chain, explained that while the company started off selling software development services to bitcoin companies, he has begun working with banks that want to use the underlying technology for their own purposes.

“They were interested in moving other assets the way that bitcoin moved,” he said. “This property of a digital asset that can be sent over the Internet and be settled quickly and have a record that transaction that’s immutable – that was appealing.”

Blockchain technology works by decentralizing everything. Instead of a central ledger, all participants in the network hold copies of a single distributed ledger, providing a single record that all can refer to. All transactions in the ledger are cryptographically verified to ensure that no one conducts a fraudulent trade.

In the bitcoin world, this enabled a network of anonymous participants to send funds to each other. In the world of banking, regulators typically want to know who is trading, and verify their identity. So organizations like Chain are working with banks to create custom blockchains, where the participants are authenticated.

Settling up

One application for blockchains in finance is faster settlements. Banks have traditionally managed transactions via their own digital ledgers, but they also frequently trade with each other. When they do, they need a way to settle the transactions recorded on their own ledgers between each other

If Bob buys shares in a company from Jane, then they make that agreement immediately. Before the trade can be resolved, though, someone has to make sure that Jane actually has the available shares, and that Bob has the money to pay. That happens at a clearing or settlement house, which settles all trades at the end of the day. The clearing house uses clearing banks that act as intermediaries during the transaction.

That’s not the end of the story, either. In many securities, such as stocks, the ownership of the asset must be registered with a central authority, known as a depository. It can take up to three days to complete all of these tasks after the initial trade is agreed, in what is known as a ‘T+3’ settlement window.

Blockchain technology can make that process instantaneous, which can reduce the amount of collateral that must be held during a settlement, while reducing the risk of a trade not being settled.

As interest in this technology mounts, companies are jockeying for position in what is seen as a potentially lucrative and sizeable market. One company making big strides is R3. It is working with 25 banks at last count, to create distributed ledger technology for them to use. CEO Charley Cooper said that the company has formed a working group with the banks to identify potential use cases.

“It’s been a year and a half of research, proofs of concept, conversations with various companies, and then the decision that the best way to do this was to build a consortium of banks to collaboratively deliver the best services to industry,” he said.

At the time of writing, two Canadian banks have partnered with R3: RBC and TD. Executives at RBC have previously talked about experimenting with blockchain technology by using it with a non-mission-critical currency. In RBC’s case, executives suggested a ‘safe’ currency, such as loyalty rewards points, although nothing is official yet.

“Blockchain ledgers have the potential to provide an immutable, transparent record of all transactions for a real or financial asset.  The encrypted and distributed nature of blockchain ledgers also have potential to provide additional security and business continuity,” said Carolyn Burke, vice president, regulatory, compliance and international, digital, payments and cards at RBC. “We are very interested in the use cases for integrating blockchain with internal systems and the external ecosystem and are actively working with partners to explore their viability.”

Many other companies are muscling in on the financial blockchain space. Digital Asset Holdings, Blockchain Clearing Consortium, and Symbiont are just a few. It will take a year or two for this highly-regulated industry to roll out the technology commercially, but it’s coming – and it could encourage interest from other sectors that also rely on exchanges between large numbers of companies, such as supply chain management, for example.

 

 

 


Royal Bank app uses augmented reality to find ATMs, branches

Location-based mobile services are supposed to be a boon for smart phone users (and for carriers who get some data revenue): Just open a map and query for what you want.

However, the Royal Bank has updated its mobile banking app to make it easier to find the nearest RBC automated teller machine or bank branch. It uses so-called augmented reality to create a live streetscape with icons showing the distance to the nearest ATM or branch.

INSIDE RBC augmented reality app

(The blue icon on the left says the nearest ATM is 0.8 km away. while the black icon on the right says the nearest bank is 0.5 km)

“Making continuous improvements to our mobile app to allow our customers a smooth user experience is a priority for us,” Jeremy Bornstein, head of RBC’s emerging payments division, said in a statement. The Branch/ATM Locators is one of the most used tools in the existing mobile app, he said. Combining a live view of a street with location-based services RBC has been able to develop a tool that is really useful in the day to day lives of our customers, he said.
Users need the most recent version of the app, open the Find a Location function and hit an icon that turns on the smart phone’s camera. The app links the live image, the device’s compass and its location-based service and a database of RBC locations. The nearest ATM or branch is indicated onscreen based on the direction the phone is pointed.
“If you were standing on a street corner before, you’d have a map (on screen) but wouldn’t necessarily know where you are,” Sarah Rogers, RBC’s senior manager of mobile strategy, said in an interview. Now a user can point their  mobile device down a street and the app indicates the nearest ATM or branch. If it’s not close enough, the user turns to point the screen to a different street.
The RBC mobile app, which lets users check balances, pay bills, transfer money and send money to Facebook friends, has been downloaded 2 million times since its release. Android versions come with a digital wallet.
The upgraded app is the latest way Canadian financial institutions are leveraging mobile computing to fight for customers. Earlier this month, for example, CIBC launched a mobile payments app for Telus wireless subscribers allowing them to pay for goods like coffee and groceries at participating retailers. It was initially launched on Android devices with Near Field Communications capability, with an app BlackBerrys promised by the end of the month. NFC allows users to wave their handset at an receiver that changes payments to the device’s wireless account.
Eligible devices are the Samsung Galaxy S4, SIII, Note II, HTC One, BlackBerry Z10, Q10 and Bold 9900.
In December Surviscor Inc., a research company that ranks online retail services, listed National Bank’s mobile app tops in the country for 2103, followed by CIBC (with the best tablet based mobile service), RBC (best iPhone and Android phone based mobile service) and Scotiabank (best BlackBerry-based mobile service).

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