In an era where technology is reshaping industries, BMO is making waves in the financial sector through its robust artificial intelligence (AI) initiatives and machine learning technologies.
A recent interview with Eric Morrow, Managing Director, Enterprise Data Science & AI, Data & Analytics, and Alex Tait, U.S. Chief Data and Analytics Officer, Data & Analytics, shed light on the transformative power of AI, where increased model performance directly correlates with amplified revenue, reduced costs, and most importantly, enhanced customer experiences.
At BMO, the benefits of broadly applying AI, data science and machine learning are clear. “There’s almost endless opportunity for taking data and applying models to it within a financial services organization,” said Tait. “Potential applications span everything from marketing to defending against cybersecurity threats.”
Driving AI integration at BMO
BMO considers AI an integral part of the bank’s strategy, tightly interwoven with revenue streams and cost-effectiveness. Morrow describes AI integration as a “powerful concept” that can be applied cross-functionally with active engagement across BMO’s lines of business and various Data and Analytics leaders.
“On our mobile app, for instance, you provide personalized insights to the individual, and that’s a powerful thing that really creates that connection with the customer,” he said.
In addition to AI’s application in retail banking, BMO has created new and innovative ways to apply advanced analytics to commercial customers’ needs. Earlier in 2023, Datos Insights, a global advisory firm focused on technology, regulation, strategy, and operations in the financial services industry, presented BMO with a 2023 Impact Innovation Awards in Cash Management and Payments for AI and advanced analytics for its “Digital Workbench” technology.
BMO Digital Workbench provides real-time analytics and reporting in various areas through a cloud-based self-service portal accessible to multiple businesses within the bank. It integrates scattered data sets across different bank systems with an easy-to-use, cloud-based web interface that drives cohesive and accessible analytics, facilitates insightful customer conversations, and transforms pricing and product mix strategies. A suite of data-driven tools with dynamic customer analytics and forecasting capabilities powers the technology.
Yet implementing customer solutions using AI and analytics is only part of the story. BMO supports cutting-edge research to ensure AI solutions provide functionality, accuracy, efficiency, and automation.
Supporting AI’s broader application in financial services
An example is BMO’s sponsorship of Next AI, a Montreal-based founder development network for entrepreneurs looking to solve global challenges with AI-based ventures and technology commercialization. Next AI helps identify and support early-stage ventures, which receive access to resources, mentorship education and the network they need to succeed.
Another notable endeavour illustrating BMO’s commitment to AI excellence is its partnership with the Vector Institute, a collaboration that epitomizes BMO’s dedication to staying at the forefront of AI innovation.
The Vector Institute offers a platform for BMO to explore leading AI research, turning academic insights into practical applications. A past, prominent project involves Natural Language Processing (NLP), a domain critical for a bank dealing with vast amounts of textual data.
According to Morrow, BMO can leverage NLP to help better understand why customers call into contact centres. “Being able to ensure that we’re providing the right level of service and care back to them when there are engagements between the agents is the goal,” says Morrow.
And BMO is making progress towards it. In 2023, Digital Banker recognized BMO with an Outstanding Machine Learning Initiative Award, which focused on leveraging NLP association with a contact centre.
The future of AI at BMO
BMO’s journey into AI and machine learning isn’t just about the present; it’s about building a future where technology seamlessly integrates with customer needs. The bank’s strategic direction emphasizes a digital-first approach and cloud-centricity. This focus on technological integration ensures operational efficiency and positions BMO as a pioneer in the banking industry’s digital transformation, and it starts from within the bank. This past year, more than 3,500 BMO employees participated in deep technical learning and licensing in subjects like AI, Machine Learning and Cloud.
Additionally, BMO is experimenting with new technologies enterprise-wide to develop digital capabilities to advance the bank’s Climate Ambition. Through BMO’s developing Climate Analytics Platform, the bank is using its digital capabilities, and developing the ability to use AI, to help understand the impacts and risks from weather-related events, such as floods, droughts, extreme heat and more. For any company seeking to manage this evolving risk, it is important to identify how these physical climate impacts are expected to change over time and by location, and how those changes intersect with economic systems. For banks like BMO who have a large financing footprint, it is important to identify where climate hazards are projected to manifest, and to manage the risk and capture opportunities associated with this changing future. While these programs are still under development, our technology teams can support innovation within the bank by piloting new and innovative technology driven approaches to climate related analysis.
BMO’s integration of AI is a testament to the bank’s commitment to delivering value through exceptional banking experiences across all its lines of business. Outside the bank, BMO is raising the bar in applying AI and machine learning in the financial services sector by extending that commitment to research and collaboration with esteemed organizations like the Vector Institute. As AI continues to influence the future, BMO stands as a beacon, showcasing how innovative technology can redefine banking, enrich customer interactions, and drive business growth.