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RBC says winning the 'AI arms race' key to future growth despite trade war uncertainty

Mar 28, 2025 - financialpost.com
Royal Bank of Canada's CEO, Dave McKay, emphasized the importance of artificial intelligence (AI) for the bank's future growth during its first Investor Day event since 2018. Despite concerns over a potential recession triggered by U.S. tariffs, RBC is optimistic about overcoming short-term challenges and achieving growth by expanding client relationships in Canada and globally, particularly in the U.S. McKay highlighted the need to adapt to macroeconomic changes, such as hyper-personalization and the AI arms race, while navigating uncertainties like tariffs and deglobalization.

Erica Nielsen, RBC's group head of personal business, noted that while the bank's personal business segment performed well, consumers are cautious due to trade war threats. The mortgage market showed some buoyancy with falling interest rates, but uncertainty around tariffs has made consumers hesitant. Nielsen expects increased competition in the mortgage sector with upcoming renewals and anticipates business growth once there is more clarity on tariffs. The bank is closely monitoring potential impacts on employment and job losses, similar to trends observed during the COVID-19 pandemic.

Key takeaways:

  • RBC's CEO Dave McKay emphasizes the importance of artificial intelligence for the bank's future growth amid trade war uncertainties.
  • Despite fears of a recession due to U.S. tariffs, RBC remains confident in its ability to grow by acquiring more clients and leveraging AI.
  • RBC's personal business segment, including deposits and mortgages, performed well, but consumers are cautious due to trade war threats.
  • Erica Nielsen, RBC's group head of personal business, anticipates increased competition in the mortgage market with many renewals coming up.
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