Royal Bank of Canada, Cohere to Build AI Solutions for Financial Services

Royal Bank of Canada (TSX and NYSE: RY) on Thursday said it partnered with Cohere, a technology company focused on artificial intelligence for the enterprise, to co-develop and securely deploy an enterprise generative AI (genAI) solution for financial services called North for Banking.

The company said North for Banking will integrate with RBC's and Cohere's proprietary foundation models, as well as RBC's internal platforms with the goal to speed-up development of genAI solutions at RBC securely and efficiently.

"RBC is on a path to redefine what a bank is capable of, and AI will play an important role in our future success," said Dr. Foteini Agrafioti, senior vice president, RBC Borealis and chief science officer, RBC. "With its globally recognized enterprise AI expertise, Cohere is an ideal partner for us as we build upon almost a decade of AI investment and a strong commitment to responsible AI principles, to continue to innovate and harness the potential of genAI with our clients' safety and security at the forefront."

Shares of the company closed up $0.73, or 0.4%, to $175.01 on Wednesday on the Toronto Stock Exchange.

Canada's largest banks may be the next group to walk away from the industry's biggest climate-finance alliance, Bloomberg has reported.

It noted the Net-Zero Banking Alliance has suffered an exodus in recent weeks, with Goldman Sachs Group Inc., Morgan Stanley, Wells Fargo & Co., Bank of America Corp., Citigroup Inc. and JPMorgan Chase & Co. all leaving. The moves coincide with intensifying Republican attacks on what US conservatives call "woke" capitalism and criticisms that such voluntary alliances haven't had a meaningful impact on reducing greenhouse gas emissions.

Against that backdrop, two of Canada's biggest lenders are now showing signs of reconsidering their own membership.

"Pulling out of NZBA, hypothetically, doesn't lead to a non-commitment to net zero or climate change," Royal Bank of Canada Chief Executive Officer Dave McKay said Tuesday at an industry conference hosted by his firm in Toronto. "It just means that mechanism, that organization that fostered oversight and policies and rules around what you can and can't do and how you report, maybe that isn't the right mechanism to do it."

Speaking at the same event, Bank of Montreal CEO Darryl White said the bank is still a "member of the alliance. At least we are today."

As of Wednesday, NZBA's website still listed the lenders as members. A spokesperson for the group declined to comment.

(Market Chatter news is derived from conversations with market professionals globally, and/or from other media sources. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

By Steve Garmhausen

What's so great about being rich? Mötley Crüe drummer Tommy Lee may have said it best: "The best thing about being rich is the freedom; freedom to do whatever you want whenever you want. It doesn't suck."

But wealthy people can be as stressed and unhappy as anyone, despite, or sometimes because of, their money. They can even suffer from the feeling

that they don't have enough. For example, a recent survey from Northwestern Mutual found that only 32% of American millionaires consider themselves "wealthy." So what is it that rich people worry about? We put that question to five financial advisors in this week's Barron's Advisor Big Q column.

David La Pointe, founder, La Pointe Wealth Advisors: You're only as happy as your saddest kid. That's not a financial statement; it's just a reality. A lot of people who are extremely rich unfortunately didn't spend enough time with their kids, and/or their kids have no concept of how to make money and their lives are screwed up. Wealthy people often worked really hard and took major capital risk on some sort of innovation or even just a simple product. They scratched and suffered and went through lean times and usually borrowed money. They worried about cash flow, because leverage will kill you. You can have a great product, but if you run out of cash, you're bankrupt. It's a lot of stress. Then once they're rich, you'd think they wouldn't worry about money anymore. But they do, because if they're 60 or 70, they don't want to go through all of that again.

Nell Cordick, financial advisor, Bogart Wealth: Money is relative; it causes the same stress for someone who has a very low income as someone who is very wealthy. My clients are all wealthy, and they have the fear of running out of money. Regardless of how much someone has, they do not ever want to be dependent on their kids to provide for them.

Another fear is, "What happens if I passed away? Is there enough money left over for my spouse to live in the way that he or she has become accustomed to?" A third fear, and this ebbs and flows depending on what is going on in our economic system, is a fear of a market correction. They still can remember 2008. They certainly can remember 2022. "What happens if that affects my whole total portfolio?" How to react to that is always in the back of their mind. There is a fear of not leaving a legacy. The question is, "Do I have enough to live the way I want to live and still leave a legacy for my kids and/or charity?" Most people want to leave something to someone, regardless of what place the giver is on the economic spectrum. So they're cautious with their own money. There's a fear of not being able to help one's kids or grandkids. And people really fear very high inflation. When everything is more expensive — their food, utilities, home repairs, dental work — they have the fear of the money running out.

Bill Ringham, director of private wealth strategies, RBC Wealth Management: What I often see is that what wealthy people have to do becomes complex. Those who earn the wealth have a responsibility for shepherding it, and those who've inherited that wealth often feel a greater responsibility to be good stewards of it. There can be planning complexity: Where do I put my money? How do I invest? And there can be tax complexity: Where do I withdraw my money from? What's the most tax-efficient approach? There can be worry about tax laws changing, which could affect the planning a person has done. People often perceive that wealth breeds happiness, but they might not expect some of the more challenging nuances of the tax ramification of their wealth.

For people who are philanthropic, having more money allows them to capitalize on their philanthropic goals and objectives a little differently. However it also breeds a different complexity, where they're being invited to fund-raising events of causes they might not feel passionate about. So they become reactive givers versus having well-articulated philanthropic values, vision, and mission.

James Beam, head of investment management, brokerage, planning, retirement, and strategy, TD Wealth: Many people's financial fears arise from not being able to meet the essential needs of housing, food, healthcare, and education. The wealthy often worry about money, but I think their concerns are different. One is preservation of wealth: The more you have, the more you have to lose. And that can be via inflation, taxes, market volatility, or fraud. And lifestyle and obligations usually change the more wealth you have. You start adding luxury homes, private schools, vacations, staff in some cases, and more. And that creates financial pressure, especially if income streams are disrupted.

Finally, managing large sums of money often requires dealing with different issues such as tax strategies, legal strategies and structures, estate planning, and probably more complex investment portfolios. That leads to different stressors. And then there's legacy. If you're philanthropically inclined or geared towards leaving a legacy whether your family or externally, wealth can be drained faster than anticipated. And for some wealthy people there are the fears of entitlement or dependency for family members versus empowering the next generation to thrive and be successful and not be too dependent on the family.

Jay Funyak, lead financial advisor, MFA Wealth: There's often a fear of losing it all. And the concerns usually come down to a few things. There's geopolitical uncertainty; wealthy individuals are very tuned in a global sense because they know how quickly the markets can change and economies can react to things like political instability or international conflicts or trade disputes. Those are things that they cannot control, but they're constantly evaluating how to mitigate their exposure. Another worry is the U.S. being the economic leader. There's a lot of unease about what happens if, for instance, the U.S. dollar loses its global dominance, or if the country becomes weak and it's not as influential as it is now. Many of our clients have portfolios built on U.S.-centric investments, so any sign of real instability in our financial system is a significant concern.

The other big concern is natural disasters. There's a growing concern, especially among business owners, that they're very vulnerable to the impact of natural disasters. We witnessed that this past year with the terrible things that happened in North Carolina. It's not just the immediate damage that happens; it's also the potential long-term economic impact of that event. Wealthy people aren't just thinking about their current assets. They're focused on protecting their families, their businesses, and the legacies they want to leave. They're thinking long term, and they do get concerned about things that are out of their control.

Write to advisor.editors@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

Flowers Foods said Wednesday it has agreed to acquire Simple Mills for $795 million in cash from Katlin Smith, Simple Mills management, Vestar Capital Partners, and initial angel investors.

The company said the acquisition increases its position in the healthy snack market and improves the company's growth and margin prospects. It added that it expects the acquisition to be accretive to net sales immediately and to earnings per share in 2026.

On closing, which is expected in Q1, Simple Mills will become an independent subsidiary of Flowers Foods and continue to be led by its current leadership team, the company said.

Flowers Foods also said it has entered into a binding commitment letter for a $795 million term loan from Royal Bank of Canada to help fund the transaction.

FLO shares were edging 0.4% higher in recent premarket activity.