James Rausch, head of Canadian client coverage and global head of banks, brokers and exchanges at RBC Investor & Treasury Services (RBC I&TS), discusses how the organisation works alongside clients, leveraging resources and expertise from its other businesses and applying an innovative technology-driven approach to support its own growth
What is RBC I&TS’s recipe for attracting new clients while maintaining its existing relationships?
James Rausch: Building long‑term client relationships and delivering exceptional experiences are key areas of focus for RBC I&TS. We deliver on these objectives through the provision of top‑quality asset‑servicing capabilities combined with a continued investment in technology and innovation, which supports the development of solutions that align with our clients’ requirements.
As part of Royal Bank of Canada, Canada’s largest bank, we are proud of our Canadian dollar clearing and custody services, supported by experienced professionals who understand the Canadian market. We offer an integrated approach that focuses on understanding our clients’ challenges and addressing them using a range of capabilities from cash management and trade finance to asset servicing.
We also leverage expertise from across RBC businesses, including RBC I&TS, capital markets and commercial banking – which reflects our strength as a full-service provider.
Our strong representation and participation in local-market associations and dedicated governance and regulatory solutions teams position us as influential industry participants, serving the interests of our clients as well as those of the industry as a whole.
What solutions has RBC I&TS developed to address regulatory changes impacting its client base?
James Rausch: An important part of our role in the industry is ensuring we have a deep and thorough knowledge of the Canadian securities marketplace and infrastructure. We closely monitor the changing regulatory landscape, communicate these market changes to our clients, assess the potential impact they may have on their business operating models and provide support and guidance in helping them meet their obligations.
Our clients are keenly focused on staying abreast of regulatory developments. To further support that interest, RBC I&TS has launched an exciting initiative in the past quarter in the form of its partnership with Thomson Reuters. We are the first organisation to partner with Thomson Reuters to provide clients globally with access to comprehensive, relevant and timely regulatory intelligence content through our website, rbcits.com.
How has the Canadian market evolved over the past 12 months, and what opportunities can be found in that region?
James Rausch: The Canadian market achieved a significant milestone with a seamless transition from a T+3 to a T+2 settlement cycle in September. The implementation of a T+2 settlement cycle has helped reduce counterparty risk, decreased clearing capital requirements and reduced procyclical margin and liquidity demands. Most importantly, the Canadian market now aligns with global markets – increasing global settlement harmonisation and the attractiveness of the Canadian market.
Canada continues to attract foreign investment with a market underpinned by a stable political and economic environment combined with strength in the financial sector and commodity resources. The economic prospects for Canada in 2018 remain positive, and the economy is expected to lead the Group of 7 countries in terms of growth. The stance of the Canadian government as an open, free-trade country helps increase growth value and global appetite for investment in Canada. RBC I&TS is well positioned to support our business strategies in the Canadian market.
How does RBC I&TS align its product offering to meet clients’ needs?
James Rausch: Client priorities typically centre on operational robustness and efficiency, risk management and adherence to regulatory compliance requirements, with an increasing focus on outsourcing models. In addition, an increasing appetite towards value-added services from a strategic partner can provide insights and analytics to support long-term goals. We work collaboratively with clients to support the evolution and growth of their business strategies as part of our client‑centric approach. We place clients at the centre of our strategy through ongoing dialogue and engagement.
For example, our Advanced Client Experience (ACE) programme is a key driver of our digital transformation and multiyear technology strategy. Our vision is to be a client-centric, digitally enabled business. ACE is enabling our teams to work together more effectively, and aligns service delivery with our clients’ evolving needs. Our focus on technological advancements is helping to enhance clients’ experiences with our business, while improving operational efficiency and reducing risk. Our strategy aligns with RBC’s strong focus on innovation and enterprise-wide efforts to be a digitally enabled, technology‑driven organisation.
What will be the greatest challenge facing custodians in 2018?
James Rausch: Increasing regulation, greater focus on transparency and the pressure to lower costs are key trends. In response, custodians are intensifying their focus on optimising their businesses to create value for clients. Our clients are also witnessing profound shifts in ways of doing things and are interacting in a context where change is constant. The new norm is digital, automated and data-driven. The challenge is to identify how we can be enablers of change and create long-term sustainable value.
As a custodian, we must provide an enhanced product suite that addresses the needs of our clients. In anticipation of both regulatory and market change, we also have a role in preparing our clients for new requirements and helping them transition.
Today, many of these requirements are met through next‑generation technologies. At RBC I&TS, we have implemented robotic process automation (RPA) solutions, which have resulted in rapid and secure automated completion of daily repetitive tasks and workflows. This allows resources to be focused on higher-value activities, including faster tracking and auditing of transaction data. RPA provides greater data accuracy, speed and transparency, and we continue to develop new ways of leveraging this technology.
Beyond platforms and processes, extracting the value of data for our clients is a key priority. By creating a robust data governance structure, harmonising and integrating data sources, investing in new architecture and processes – such as the cloud and emerging big data solutions – and providing data analytics capabilities, custodians can bring new dimensions to their product offerings. Not only will they deliver an enhanced client experience, but they will also draw attention to operational performance topics and data insights that support decision‑making and analysis.
As a global custodian, we hold vast amounts of data, and continue to explore data patterns that cause meaningful insights to surface. RBC I&TS is embracing technology and leveraging the power of data to uncover and create value for our clients.