As banks turn their attention to retail, it's clear that newcomers will be key to grabbing market share.As customers approach the bustling Canadian Imperial Bank of Commerce branch snuggled within the Albion Mall on the outskirts of Toronto, one of the first things they see is a sign that reads: 'Welcome to CIBC, Services are available in the following languages' and lists Hindi and Punjabi.

The bank installed the large plaques in a number of branches this summer, one of the little indicators that a major shift is under way in Canadian banking. It begins with the renewed focus on retail, or consumer, banking as a large number of new entrants to the game ramp up competition at a time when the perils of investment banking are becoming increasingly clear.But the age-old problem for Canada's big banks is that it's difficult to wrestle significant gains in market share from one another.

Undercut the competition on mortgage pricing one quarter, or raise interest rates on savings accounts, and you might steal a few customers. But, by and large, Canadians have been fairly lazy when it comes to switching banks.That's part of the reason why the profound demographic shift occurring in Canada right now creates such an opportunity for the banks - and such a challenge.

'Newcomers will account for almost the entire growth in Canada's population during the next few decades,' said Sonia Baxendale, senior executive vice-president of retail markets at CIBC. 'Companies that are able to attract a diverse client and employee base will be the most successful in tomorrow's economy.' By 2017, about one in every five faces in Canada will belong to a visible minority. As the birth rate dwindles, at some point around 2030, international net migration is expected to become the only source of population growth here.

Reaching out to the immigrant market is one of the Royal Bank of Canada's 'key priorities,' said Mark Whitmell, director of cultural markets. RBC is about to test a program that will offer immigration consultants reward points for referring clients to the bank. It has also just begun advertising its Canadian services in China for the first time, with ads aimed at people who might be considering emigrating. That type of active approach is becoming more prevalent.

Tracy Redies, executive vice-president of personal banking services at HSBC Bank Canada, said the bank is increasingly establishing accounts and credit facilities for customers before they land here.'We've seen a substantial rise in the number of people we are handling like that,' she said, with at least hundreds of such accounts having been opened in the past couple of months. 'As long as they have the appropriate paperwork, immigrant status and that, then we can open the account and they can just show up at the branch and finalize everything,' she said.

Most of the banks are also adding to their language capabilities, and have, in the past couple of years, been changing their loan approval standards for newcomers who don't have a Canadian credit history. Without that history, it's often been difficult for new Canadians to obtain loans, said Christina Kramer, CIBC's senior vice-president of distribution. CIBC's process now considers factors such as the amount of investable assets the person is bringing, and their employment plans here.

Beginning this coming January, CIBC's customers will be able to do their banking on the company's 3,800 ABMs in the Chinese language. The bank is working on adding more languages in the next two years, with Portuguese and Italian high on the list.

Meanwhile, Bank of Nova Scotia is expected to announce shortly that it has hired a vice-president of multicultural banking, Rania Llewellyn, who was born in Kuwait City to an Egyptian father and a Jordanian mother, and came to Canada from Egypt in 1992. She's spent the past decade working in corporate and commercial banking at Scotiabank. 'There are challenges in tapping the multicultural market, including language and access to credit,' she said in an e-mail. 'Over coming weeks and months, we will be building on current initiatives and introducing new products and services to address those challenges.'

Bank of Montreal also recently carved out a new role, managing director of specialty markets in the Greater Toronto Area division, for Heather Grand. She was previously CEO of bcpbank Canada, a bank catering to the Portuguese-Canadian community that was bought by BMO in December. Ms. Grand suggested that banks need to stretch past basics to ingratiate themselves with newcomers.

'When they come to the bank, they'll often want to know: 'Can you recommend a realtor? Can you recommend a neighbourhood, or a school?' which is far beyond the normal financial services that we might think people would be looking for. The other part of that is to act as a trusted adviser, and to give them information.'

The banks are also boosting their advertising budgets to ensure that pitches to newcomers are tailor-made.

Serge LaPointe, vice-president of global branding and corporate marketing strategy at Toronto-Dominion Bank, offers up this example:

TD recently rolled out TV commercials about 'grumpy old guys' in English and French. But because there is a different level of respect for senior citizens in the Chinese culture, the 'old guys' aren't grumpy in the bank's Chinese-language ads. 'It's the same setup. But we deliver it as happy old guys, who are sitting across from the branch, going, 'Hey, look at that, they're open even longer.'


By Tara Perkins

The Globe and Mail (Canada), November 20, 2007