Nordea's digital savings adviser Nora shows promising results - FinanceFeeds

Nordea’s digital savings adviser Nora shows promising results

Maria Nikolova

Nordea says 70% of its customers in Sweden who started to save through Nora have not previously saved with the bank.

When Nordea Bank AB (STO:NDA-SEK) first announced its plans to launch a web-based robot advisor last year, the announcement was overshadowed by the news that the digital transformation of the bank will involve significant job cuts. Casper von Koskull, President and Group CEO, said back then it was time to enter the next phase of the transformation, involving bringing down costs and increasing efficiency.

“This transformation requires a shift in competence among our employees. Additionally, in order to secure long-term competitiveness, we also plan to reduce the number of employees and consultants with at least 6,000 of which approximately 2,000 are consultants”, Casper von Koskull said.

But the digitalization of Nordea’s business apparently has a bright side too. It does show good results. Earlier today, the bank posted its financial report for the first quarter of 2018, with Nordea’s CEO updating on the new technology adoption at the bank. He noted that the bank launched its digital savings adviser Nora that provides customers with digital savings advice 24/7. In terms of numbers, he said that 70% of the customers in Sweden who started to save through Nora have not previously saved with Nordea.

So, it appears that the artificial intelligence (AI) push of Nordea does deliver.

Nordea is not the single bank to bet heavily on AI for servicing its customers. In a speech given on Tuesday, April 24, 2018, Herman Gref – CEO and Chairman of the Executive Board of Sberbank, said that 98% of the Sberbank decisions for extending loans to individuals and 30% of the decisions for providing loans to business entities are taken by AI.

This, of course, raises concerns about job losses at the Russian bank too. Let’s recall that in June 2017, Mr Gref said the number of employees in back office roles at the bank will be reduced 12 times by 2021, with the use of robots being one of the factors for the jobs trimming.

In its report for the first quarter of 2018, Nordea underlined other aspects of its commitment to new technology development. Nordea has joined the consortium as founding partner. The consortium is, in conjunction with IBM, developing a platform based on distributed ledger technology (DLT) that aims at making domestic and cross-border commerce easier, safer and more efficient for companies.

Read this next

Inside View

How is Michael Bolton supposed to live without… PFOF?

Mullet-clad, leather jacket toting 1980s soft rock crooner Michael Bolton sings about the heartbreak Payment For Order Flow (PFOF) can cause FX liquidity takers

Inside View

Goldman Sachs CEO David Solomon is right!

Working from home should absolutely not be the way forward, and companies closing their office space to make working from home a permanent feature are making a big mistake.

Industry News

Charlie Munger: “No one should believe Robinhood trades are free”

“It’s most egregious in the momentum trading by novice investors lured in by new types of brokerage operation like Robinhood and I think all of this activity is regrettable.”

Institutional FX

DTCC says T+1 settlement can drop clearing margin volatility by 41%

This topic gained wide exposure in the aftermath of the ‘meme stocks’ trading frenzy initiated by the r/WallStreetsBets subreddit which successfully gathered an army of retail investors to create a short squeeze in the GameStop (GME) stock.

Institutional FX

TP ICAP Launches Post-Trade Solution for Fixed Income in United States

“Our network of corporate bond and emerging market traders is one of the largest in the US, and through Matchbook Rebalance we’re able to offer a high-quality risk mitigation solution.”

Industry News

SEC boosts ESG oversight to address corporate greenwashing

“It is our responsibility to ensure that [investors] have access to material information when planning for their financial future”.

Institutional FX

SGX partners with OneConnect to build ESG platform

The platform addresses common challenges faced by companies and investors such as lack of comparability, changing investors’ demand, as well as the evolving business landscape and regulations.

Institutional FX

SIX acquires ESG analytics firm as industry races toward societal impact

Orenda analyzes and quantifies social media data to provide insights, quantify public perception, and identify values that resonate with customers and stakeholders. Organizations and investors are then able to make better decisions based on real-time metrics.

Industry News

ETF pioneer and industry expert, Manooj Mistry, joins HANetf as Chief Operating Officer

Manooj Mistry is a senior leader, who is credited with the launch of Deutsche Bank’s Xtrackers ETP business in 2007