“It’s absolutely a fair statement that we are actually a technology company that is really fabulous at banking,” says Bank of America CEO Brian Moynihan. “We have 37 million digital customers, 28 million mobile customers. It’s all been automated, wires and stuff, but now the interface with the customers is much more automated. That efficiency is driven by the technology enablement of the consumer and wealth management companies and it’s always more efficient to serve it that way. So that 57 percent efficiency ratio, that’s enabled by technology.”

Brian Moynihan, CEO of Bank of America, discusses how their massive investment in technology has made them dramatically more efficient and customer-centric. Their focus on digital banking through their app has, in particular, appealed to Millenials. Moynihan says that if Bank of America were a “Millenial-Only” bank, it would still be one of the largest banks in the country. Moynihan was interviewed by Jim Cramer on CNBC: 

Our Efficiency Is Driven By Technology

It’s absolutely a fair statement (that we are actually a technology company that is really fabulous at banking). At the end today, we have really talent teammates, the computers that they operate and the technology that they operate, and then frankly buildings to keep it all dry so it works. That’s what we have. Those teammates use those computers to either build them so clients can work themselves or work with them to help serve clients. We have 37 million digital customers, 28 million mobile customers, the numbers just roll in. 

By the way, what we highlight in our earnings report on the institutional side, you’re seeing in the treasury services, it’s all been automated, wires and stuff, but now the interface with the customers is much more automated. That efficiency is driven by the technology enablement of the consumer and wealth management companies and it’s always more efficient to serve it that way. Yet you have to have great people when the face-to-face meeting comes up when the need is there. 

So that 57 percent efficiency ratio, we ran about $13.3 billion in expenses, that is seven of the last eight quarters we ran between 13.1 and 13.3, one was a little higher. In that time we’ve invested in thousands of relationship management people, $3 billion a year in technology, probably 60-70 brand-new branches and retooled probably a thousand branches. All of that investment going in at the same time expenses were flat. That’s enabled by technology. 

If Bank of America Were a “Millenial-Only” Bank, It Would Still Be Huge

That’s the key (making a banking app design that does appeal to everybody). It works for general consumers, it works for wealthy consumers that work for small companies, it works for big companies. With that many digital customer’s everybody’s using it. Now does it cohort on age a little bit younger? What I said in yesterday earnings about Millennials was more about a debate about whether banks like us are appealing to Millennials? 

We open accounts at three times the population rate in our new sales. We have about twice the population rate of Millennials in our customer base today. They have $60-70 billion in checking deposit, just the Millennials. Then with Gen Z, add another chunk on top of it. It’s already a huge customer base. Then the 16 million customers who are digital-only Millennials have $200 billion of investments, deposits, and loans with us. It’s already a big business. As a Millennial only bank, it would be one of the biggest banks in the country, probably the fifth or sixth largest bank.