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Canadian Banks and Credit Unions - January 2014

Published By :

Mintel

Published Date : Feb 2014

Category :

Banking

No. of Pages : 168 Pages

Canadians are very loyal to their banks, but quite consistently have accounts at other institutions, which indicates that there are opportunities for institutions with the primary relationship to increase cross-sell efforts. One way to do this is by offering enhanced mobile banking features, since Canadians have yet to adopt mobile banking on a large scale.
Table of Content

Scope and Themes

What you need to know
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms

Executive Summary

Overview of the Canadian Banking Industry
Market drivers
Leading companies
Figure 1: Where primary chequing account is held, overall, November 2013
Innovations and Innovators
The consumer
Figure 2: Banking activities conducted on desktop/laptop and smartphone, overall, November 2013
Figure 3: Type(s) of products/accounts held with primary chequing account provider and other institution, November 2013
Custom consumer groups – Asians
Figure 4: Mobile device ownership, Asians and Non-Asians, November 2013
Figure 5: Usage of electronic banking, by race, November 2013
Figure 6: Interest in electronic banking, by race, November 2013
What we think

Insights and Opportunities

Key points
Consumers need more incentives to use mobile banking
Asians want better service, but not necessarily personal service
What’s the point of branches?

Trend Application

Inspire Trend: Prepare for the Worst
Inspire Trend: Life Hacking
Mintel Futures: Access Anything, Anywhere

The Banking Industry in Canada

Key points
Total Canadian bank and credit union assets total C$4 trillion
Types of banks and bank regulation in Canada
Credit unions and caisses populaires

Market Drivers

Key points
Population growth remains dependent on (Asian) immigration
Fears of a Canadian housing bubble may be easing
Figure 7: Attitude statements about Canadian and personal economies, overall, November 2013
Figure 8: Agreement with statements about Canadian and personal economies, by household income, November 2013

Competitive Context

Key points
Big Five banks control 90% of the Canadian market
Figure 9: Largest Canadian banks and caisses populaires by assets and market share as of Oct. 31, 2013
Largest credit unions outside Quebec
Figure 10: Top 5 credit unions outside Quebec by assets, Q4 2012 – Q2 2013

Segment Performance

Key points
Canadian banks still among the world’s safest
Figure 11: Canadian Banks – credit ratings and global rankings, 2013
Banks remain strongly profitable, although growth is slow
Figure 12: Financial performance of Canada’s largest banks, 2012 -13

Leading Companies

Key points
Canadian banks
Canadian credit unions and caisses populaires

Innovations and Innovators

Key points
Sunova is first Canadian credit union to offer Interac Flash
Interac, RBC, McDonald’s launch mobile debit payments
Interac Flash rolled out to Coke vending machines
PayPal offers cloud-based mobile app to check in and pay at restaurants
MasterCard launches MasterPass digital wallet
PC Financial, TD launch Canada\'s first open mobile wallet
ING Direct facilitates banking through Facebook
TD launches money transfer service to Visa-branded cards
RBC announces Secure Cloud, Canada’s first cloud-based mobile payments solution
RBC brings P2P electronic money transfers to Facebook Messenger
Mobile cheque deposit comes to Canada
TD rolls out “green” ATMs
Capital One offers C$1 million prize in curling contest
Canadian banker appears on the “Daily Show”

Marketing Strategies

Key points
Examples of advertising
Figure 13: ING Direct direct mail ad, 2013
Figure 14: RBC direct mail ad, 2013
Figure 15: RBC direct mail ad, 2013
Figure 16: RBC direct mail ad, 2013
Figure 17: TD Canada Trust online ad, 2013
Figure 18: ING Direct direct mail ad, 2013
Figure 19: RBC direct mail ad, 2013
Figure 20: Sears Financial direct mail ad, 2013
Figure 21: CIBC direct mail ad, 2013
Figure 22: RBC direct mail ad, 2013
Figure 23: BMO online ad, 2013
Figure 24: Capital One direct mail ad, 2013
Figure 25: HSBC direct mail ad, 2013

Consumers and Banking Channels

Key point
Most Canadians own a mobile device
Figure 26: Mobile devices owned, by gender, November 2013
Figure 27: Mobile devices owned, by age, November 2013
Figure 28: Mobile devices owned, by gender and age, November 2013
Figure 29: Mobile devices owned, by household income, November 2013
Figure 30: Mobile devices owned, by provinces, November 2013
However, Canadians are not yet sold on mobile banking
Figure 31: Interest in/use of banking channels, mobile device owners by gender and age, November 2013
Figure 32: Interest in/use of banking channels, mobile device owners by household income, November 2013
Figure 33: Interest in/use of banking channels, mobile device owners by provinces, November 2013
Most people bank online, but not on a mobile device
Figure 34: Channels used to conduct various types of transactions, overall, November 2013
PC users primarily paying bills
Figure 35: Banking activities conducted on desktop/laptop, by gender and age, November 2013
Figure 36: Banking activities conducted on desktop/laptop, by provinces, November 2013
Figure 37: Banking activities conducted on desktop/laptop, by gender and household income, November 2013
Banking activities conducted in branch
Figure 38: Banking activities conducted in branch, by gender and age, November 2013
Figure 39: Banking activities conducted in branch, by provinces, November 2013
Figure 40: Banking activities conducted in branch, by gender and household income, November 2013
ABM’s used for deposits/withdrawals and little else
Figure 41: Banking activities conducted at ABM, by gender and age, November 2013
Figure 42: Banking activities conducted at ABM, by gender and household income, November 2013
Figure 43: Banking activities conducted at ABM, by provinces, November 2013

Mobile Device Owners and Banking Activity

Key points
Figure 44: Banking activities conducted with smartphone, by gender and age, November 2013
Figure 45: Banking activities conducted with smartphone, by household income, November 2013
Figure 46: Banking activities conducted with smartphone, by provinces, November 2013
Figure 47: Banking activities conducted with tablet, by gender and age, November 2013
Figure 48: Banking activities conducted with tablet, by provinces, November 2013

Consumers and Banking Products

Key points
Nearly all have chequing accounts
Figure 49: Chequing account ownership, by household income, November 2013
Savings accounts, credit cards are next most popular
Figure 50: Type of nonchequing account/product owned, by gender, November 2013
Figure 51: Type of nonchequing account/product owned, by age, November 2013
Figure 52: Type of nonchequing account/product owned, by household income, November 2013
Figure 53: Type of nonchequing account/product owned, by provinces, November 2013

Location of Primary and Secondary Accounts

Key points
Canadians favor the biggest banks
Figure 54: Where primary chequing/debit card account is held, by gender and age, November 2013
Figure 55: Where primary chequing/debit card account is held, by household income, November 2013
Figure 56: Where primary chequing/debit card account is held, by provinces, November 2013
Location of secondary chequing accounts
Figure 57: Where other chequing/debit card account(s) are held, by gender and age, November 2013
Figure 58: Where other chequing/debit card account(s) are held, by household income, November 2013
Figure 59: Where other chequing/debit card account(s) are held, by provinces, November 2013
Other types of accounts
Figure 60: Where primary savings/investment/mortgage accounts are held, overall, November 2013
Figure 61: Where primary investment account (other than retirement account) is held, by household income, November 2013
Figure 62: Where primary retirement savings account is held, by household income, November 2013
Figure 63: Where primary investment account (other than retirement account) is held, by provinces, November 2013
Figure 64: Where primary retirement savings account is held, by province, November 2013
Figure 65: Where primary residential home mortgage is held, by household income, November 2013
Figure 66: Where primary residential home mortgage is held, by province regions, November 2013
Figure 67: Where primary general purpose credit card is held, by household income, November 2013
Figure 68: Where primary general purpose credit card is held, by provinces, November 2013
Canadians keep secondary accounts at another bank
Figure 69: Type(s) of products/accounts held with primary chequing/debit card provider, November 2013
Figure 70: Type of products/accounts held at primary chequing/debit account provider, by provinces, November 2013
Figure 71: Type of products/accounts held at other financial institutions, by provinces, November 2013
Home equity loans are most popular at primary banks
Figure 72: Type(s) of savings/loan products held with primary chequing/debit card provider, November 2013
Figure 73: Type of savings/loan products/accounts held at primary chequing/debit account provider, by household income, November 2013
Figure 74: Type of savings/loan products held at other institution, by household income, November 2013

Loyalty and Switching

Key points
Canadians are extremely loyal to their banks
Figure 75: Switched primary bank/credit union/caisse populaire in past five years, by gender and age, November 2013
Figure 76: Switched primary bank/credit union/caisse populaire in past five years, by household income, November 2013
Figure 77: Switched primary bank/credit union/caisse populaire in past five years, by provinces, November 2013
Very few are even thinking of switching
Figure 78: Are considering switching primary bank/credit union/caisse populaire, by gender and age, November 2013
Figure 79: Are considering switching primary bank/credit union/caisse populaire, by household income, November 2013
Lowering fees is the main reason to switch banks
Figure 80: Reason would switch primary bank/credit union/caisse populaire, by gender, November 2013
Security is the main reason people choose their bank
Figure 81: Important features in choice of bank/credit union/caisse populaire, November 2013

Attitudes toward Banks

Key points
Canadians not convinced big banks are better than small banks
Figure 82: Attitudes toward banks and financial advice, overall, November 2013
Figure 83: Any agreement with attitudes toward banks and financial advice, by gender and age, November 2013
Figure 84: Any agreement with attitudes toward banks and advice, by household income, November 2013

Consumer Financial Priorities

Key points
Canadians remain cautious about saving and spending
Figure 85: Attitudes toward Canadian economic outlook and personal financial situation, overall, November 2013
Figure 86: Attitudes toward Canadian economic outlook and personal financial situation, by age, November 2013
Figure 87: Attitudes toward Canadian economic outlook and personal financial situation, by household income, November 2013
Figure 88: Attitudes toward Canadian economic outlook and personal financial situation, by province, November 2013
Improving credit scores is the highest priority
Figure 89: Household financial priorities, November 2013
Figure 90: Household financial priorities – any important, by age, November 2013
Figure 91: Household financial priorities – any important, by household income, November 2013
Figure 92: Household financial priorities – any important, by provinces, November 2013

Custom Consumer Groups – Asians

Key points
Asians much more likely to own mobile devices
Figure 93: Mobile devices owned, by race, November 2013
Yet, they don’t use mobile banking more often
Figure 94: Interest in/use of electronic banking, by race, November 2013
Asians favor the biggest banks
Figure 95: Where primary chequing/debit card account is held, by race, November 2013
Asians are not shy about switching banks…
Figure 96: Bank switching behavior, by race, November 2013
and would do so again
Figure 97: Are considering switching primary bank/credit union/caisse populaire, by race, November 2013
Asians most likely to switch for lower fees
Figure 98: Reason would switch primary bank/credit union/caisse populaire, by race, November 2013
Asians trust banks more, but love them less
Figure 99: Attitudes toward banks and financial advice, by race, November 2013
They like investment firms even less than banks
Figure 100: Attitudes toward investments and investment companies/advisers, by race, November 2013
Asians own more banking products than others
Figure 101: Type of nonchequing account/product owned, by race, November 2013

Cluster Analysis

Cluster 1: Big Bank Advice Seekers
Demographics
Characteristics
Opportunity
Cluster 2: Disinterested Switchers
Demographics
Characteristics
Opportunity
Cluster 3: Credit Union Conservatives
Demographics
Characteristics
Opportunity
Cluster characteristic tables
Figure 102: Target clusters, November 2013
Figure 103: Mobile devices owned, by target clusters, November 2013
Figure 104: Chequing account ownership, by target clusters, November 2013
Figure 105: Type of nonchequing account/product owned, by target clusters, November 2013
Figure 106: Where primary chequing/debit card account is held, by target clusters, November 2013
Figure 107: Where other chequing/debit card account(s) are held, by target clusters, November 2013
Figure 108: Where primary savings account is held, by target clusters, November 2013
Figure 109: Where primary investment account (other than retirement account) is held, by target clusters, November 2013
Figure 110: Where primary retirement savings, by target clusters, November 2013
Figure 111: Where primary residential home mortgage is held, by target clusters, November 2013
Figure 112: Where primary general purpose credit card is held, by target clusters, November 2013
Figure 113: Type of products/accounts held at primary chequing/debit account provider, by target clusters, November 2013
Figure 114: Type of products/accounts held at other financial institutions, by target clusters, November 2013
Figure 115: Type of savings/loan products/accounts held at primary chequing/debit account provider, by target clusters, November 2013
Figure 116: Type of savings/loan products held at other institution, by target clusters, November 2013
Figure 117: Whether switched primary bank/credit union/caisse populaire, by target clusters, November 2013
Figure 118: Are considering switching primary bank/credit union/caisse populaire, by target clusters, November 2013
Figure 119: Reason would switch primary bank/credit union/caisse populaire, by target clusters, November 2013
Figure 120: Any Important features in choice of bank/credit union/caisse populaire, by target clusters, November 2013
Figure 121: Any agreement with attitudes toward banks and advice, by target clusters, November 2013
Figure 122: Interest in/use of electronic banking, by target clusters, November 2013
Figure 123: Channels used to conduct transactions – Smartphone, by target clusters, November 2013
Figure 124: Channels used to conduct transactions – Tablet, by target clusters, November 2013
Figure 125: Channels used to conduct transactions – Desktop/Laptop, by target clusters, November 2013
Figure 126: Channels used to conduct transactions – In branch, by target clusters, November 2013
Figure 127: Channels used to conduct transactions – ABM, by target clusters, November 2013
Cluster demographic tables
Figure 128: Target clusters, by demographic, November 2013
Cluster methodology

Appendix – Trade Associations

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