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RBC Forms AI Unit Targeting $1B by 2027

Royal Bank of Canada announced today it’s launching a new AI Group reporting directly to the CEO, led by 12-year tech veteran Bruce Ross. The bank’s targeting up to $1 billion in enterprise value from AI benefits by 2027—which sounds ambitious until you look at the infrastructure they’ve already built: one of Canada’s largest GPU clusters, 27,000 employees using their internal AI assistant RBC Assist, and 1,200+ patent filings since 2019 with 635 related to AI. They’re ranked #1 in Canada and #3 globally for AI maturity, so this isn’t a moonshot from a standing start. The real tell here is that they’re creating a dedicated team to “accelerate” rather than experiment, which suggests they’ve moved past the pilot phase and into actual production deployment. Whether they hit that billion-dollar target is one thing, but the organizational commitment, complete with a new Group Executive seat, indicates they’re betting the farm on AI as a core competitive differentiator.

Sources: RBC

TD Bank Says AI Success Is About Integration

Ted Paris, TD’s senior VP of AI, is pushing back on the hype cycle in an interview published today. His take: AI project failure rates aren’t about getting the model wrong, they’re about how well you integrate these tools into business processes to drive actual adoption. TD implemented 75 AI use cases generating $170 million in value last year and expects $200 million in incremental value in 2026, but Paris is focused on rethinking workflows from the ground up rather than just plugging agents into legacy processes that were designed decades ago. The bank’s deploying everything from generative AI virtual assistants in contact centers to agentic AI for more autonomous tasks, but the emphasis is on involving risk, legal, IT, and change management partners from the beginning. Translation: the hard part isn’t the technology, it’s the organizational transformation required to make it work at scale.

Sources: Banking Dive

Sphinx Raises $7.1M for AI Compliance Agents

Compliance fintech Sphinx closed a $7.1 million seed round led by Cherry Ventures yesterday, and the pitch is straightforward: instead of asking banks to adopt yet another system, their AI agents work directly inside the tools institutions already use, case management systems, PDFs, email, third-party portals. The agents handle AML, KYC, and KYB checks, review alerts, draft RFIs, and create audit trails without requiring integrations or system replacements. Teams typically go live in days, and in production the agents have already processed millions of alerts and hundreds of thousands of cases. One customer, Equals Money, saw a 94% reduction in false positives while catching more true positives. The real innovation here isn’t the AI, it’s the browser-native architecture that lets the software function inside institutional complexity without requiring a rip-and-replace overhaul. That’s why banks and fintechs are adopting it so quickly

Sources: Business Wire

Fed’s Barr Flags AI Job Risks

Federal Reserve Vice Chair Michael Barr delivered a speech yesterday acknowledging that while AI will likely boost productivity and living standards long-term, it could cause serious short-term labor market disruptions—and monetary policy isn’t equipped to fix structural unemployment. He laid out three scenarios: gradual adoption with manageable displacement, rapid adoption triggering a “jobless boom” with widespread unemployment, or stalled progress leading to modest gains and potential financial stress from overinvestment. Early evidence shows AI is already hurting some groups—particularly young workers in early-career roles like software developers and customer service reps—though aggregate employment hasn’t been hit yet. Barr’s concern is that if AI causes permanent demand reduction for many job types, society will need policies beyond the Fed’s mandate to address the fallout. The subtext: central bankers are starting to game out worst-case scenarios, and they’re not dismissing the possibility of major labor market upheaval

Sources: Federal Reserve

JPMorgan: AI Costs May Spur Bank Mergers

JPMorgan Chase analysts warned yesterday that the pace of AI investment required to stay competitive may force smaller banks into mergers, according to Bloomberg. The logic is simple: competitive demands are pushing banks of all sizes to invest in AI, but large banks and some regionals are better positioned to afford it, creating a structural advantage that smaller institutions can’t match. Financial services has already seen stock market selloffs driven by investor fears about AI’s impact on corporate profits, and this analysis suggests the pressure isn’t just about revenue disruption, it’s about the sheer capital requirements to build and maintain AI infrastructure. This isn’t a new M&A driver we’ve seen before; it’s a technology arms race that could reshape the competitive landscape by making scale even more critical than it already was.

Sources: PYMNTS

Don’t blink—the banking Singularity is accelerating.

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