Bank of America Reveals How Digital Transformation is Enhancing Customer Experience

Bank of America CEO Brian Moynihan has revealed its investment in digital transformation has assisted in deepening relationships and expanding customer base across all businesses.
Bank of America investment in technologyAditya Bhasin is chief technology and information officer for Bank of America and is a member of the company’s executive management team.

Aditya Bhasin leads a team of more than 60,000 employees responsible for designing and delivering technology solutions for all eight lines of business, staff support groups, Global Information Security, Technology Infrastructure and Global Business Services.

Digital Transformation

Bank of America is expecting there will be a drop in expenses in remaning quarters thanks to its operational excellence initiatives despite increase in cost for people and technology.

Bank of America is making technology investments to enhance digital platforms. Its annual technology investments across the last couple of years have increased from $3 billion to $3.8 billion with the aim of providing customers with convenient and secure banking experiences.

Erica, its virtual banking assistant, reached a key milestone of more than 2 billion interactions since its introduction about 6 years ago. It took four years to reach 1 billion interactions.

It took 18 months to reach the second billion. In August, Bank of America extended Erica’s reach and launched Erica in Global Treasury Services business and CashPro. Erica, as a result, 43 percent of the CashPro chat inquiries automatedly, demonstrating more and more clients are able to self-solve.

Recently, the number of Zelle transactions in a quarter had surpassed the numbers of checks written. Zelle transactions reached two times the number of checks written. This quarter, Zelle transactions have now passed the combined number of checks written, plus the amount of cash withdrawals from tellers and from ATMs.

Digital adoption and engagement improved, reaching a record of 3.4 billion digital log-ins in the quarter. Customer satisfaction scores at near-record levels illustrate the continued appreciation of the enhanced capabilities.

Merrill has 86 percent of its clients engaging with digitally and 80 percent utilizing eDelivery. 76 percent of their eligible accounts are opened digitally. So the cost for Bank of America to open is half, and the customer cycle times are improved greatly.

ACHIEVEMENTS

In consumer, Bank of America added 245,000 checking accounts during the first quarter of 2024, thanks to its digital transformation programs. This completes 21 straight quarters of net additions in checking accounts. Dean Athanasia, Aron Levine, and Holly O’Neill helped drive that business, driving strong performance across our consumer franchise.

These checking balances drive the performance of consumer deposits. Checking additions are important for many other reasons. On average, 68 percent of deposit balances have been with the bank for more than 10 years. 92 percent of the customer checking accounts are primary checking accounts in the household, meaning that they’re the core operating account for the household for their financial lives.

About 60 percent of checking accounts customers use a debit card, and in average they do about 400 transactions per year on that card. The new checking accounts have traditionally opened savings accounts, about 25 percent of the time within a few months of opening that checking account. Opening a new checking account on average brings about $4,000 in balances.

When Bank of America starts a new savings account, it brings $7,000 in balances. This also deepened it by about two times during the year. Investment relationships and credit card account openings continue to be strong in the first quarter as well.

Bank of America’s Global Wealth team led by Eric Schimpf, Lindsay Hans, and Katy Knox, added 7,300 net new wealth relationships at the Merrill and the Private Bank. Advisors opened 29,000 new bank accounts in the quarter. More than 60 percent are investing clients in Merrill, and 90 percent of private banking clients now have a core banking relationship.

Bank of America achieved $60 billion in total flows over the last year. Bank of America manages more than $5.6 trillion in total client balances across loans, deposits, and investments in consumer and wealth management.

Bank of America’s Global Banking added more new relationships in this quarter than it did in last year’s first quarter. Bank of America also increased the number of solutions per relationship with preexisting clients.

Investment in brokerage services revenue across Merrill and the Private Bank grew 11 percent in quarter 1 to nearly $3.6 billion. Investments in advisor training programs and digital delivery for clients as well as positive market helped deliver strong revenue. Asset under management flows were $25 billion in the quarter.

Baburajan Kizhakedath

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