Brokers benefit from RBC blunder

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RBC’s decision to replace 45 employees with temporary foreign workers has generated outrage among the public – and, inadvertently, a promotional boon for mortgage brokers.
“They are my competition, and have they helped me? For sure!” says Scott Dawson, a mortgage specialist with Verico Paragon Pacific Mortgages. “You read something like that, and it’s gold for us!”
RBC confirmed Sunday that it was laying off 45 employees who do its IT-related work, outsourcing their jobs to a smaller group of employees who work for iGATE.
“Definitely glad to be a mortgage broker today; glad I don’t work at a bank!” added Dawson, who sees RBC’s public relations fiasco as a chance to generate more business.
“It’s definitely helped me. It is a talking point to open a conversation with a client,” he told “What did RBC post for a profit, $7.5 billion? It gets a lot of people thinking. Let’s face it: bottom line, a bank is out to make money.”
According to RBC, iGATE technically isn’t replacing Canadian workers with foreign ones, as the new employees do not technically work for RBC (The new workers will be on visas).
The temporary foreign worker program allows businesses to hire foreign workers on a short-term basis, so long as there are no skilled Canadian citizens available to fill those positions.
RBC’s move to oursource its IT work to foreign workers may be the start of a bigger effort to outsource more of its workforce – maybe even mortgage specialists.
“They are clearly going in that direction,” says Norman Holmes, a broker and co-founder of Pioneer West Acceptance in Alberta. “It’s only IT people now, but if they are successful in cutting costs, who knows?”
Describing RBC’s move as a “very poor policy,” Holmes is certain that any move to do underwriting or brokering in offshore call centers is doomed to fail.
“If they try that it won’t work,” he says. “Brokers are highly educated, more than someone you would get working in a call center. We’re not flipping burgers here; we’re not making Big Macs.”
Ottawa had expressed concerns over RBC’s move, and the Minister of Human Resources and Skills Development late last week asked her department to work with immigration to determine what steps are needed next.
Ironically, Ottawa discovered late Monday that it had already given RBC approval to outsource the jobs.
For Holmes, RBC’s decision is hard to swallow.
“It’s pretty reprehensible,” Holmes observes. “Every quarter a new record profit is made, and I see a lot of RBC commercial clients getting the boot because their cash flow isn’t as good as it was a year ago – not meeting the bank’s criteria. That doesn’t sound like a good corporate citizen to me.”
The public backlash against RBC has been vociferous, with people flooding Twitter and online newspapers with vows of closing out their bank accounts. There is even a Facebook page showing a child crying beside an RBC man in a suit and bowler hat with the tagline: “Your child’s future outsourced. Lost Canadian jobs you can bank on.”
Dawson sees RBC’s public relations gaffe as only highlighting the personalized service brokers can offer that the big banks do not.
“I’ve had a client switch from RBC before this,” he says. “For the banks, it is all big business. The client still wants personalized service.
“Ironically, RBC may never follow through on outsourcing,” Dawson adds. “They’ve probably lost more money by outsourcing those jobs and having people pull out their money in anger.”

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