CTBC aims to transform retail banking with sustainable, AI-enabled and customer-centric innovation

In 2024, CTBC Bank (CTBC) demonstrated its claimed dominance in Taiwan’s retail banking sector through sustained growth and innovation. With its customer base surpassing 11 million and consistent annual growth across key metrics—including a 6% increase in assets under management (AUM), an 8% rise in home loan and personal loan balances, and an 8% boost in card spending volumes—the bank is poised to continue to extend its market leadership. These accomplishments reflect its strategies to balance technological innovation with a deep commitment to enhancing customer engagement and experience.

Key to CTBC's strategy is its robust integration of generative artificial intelligence (GenAI) into its operations. According to Friedman Wang, head of digital technology division, AI tools have revolutionised the bank’s ability to engage with customers. “Generative AI is helping us rewrite the customer interaction model,” Wang noted, explaining how the bank’s AI-powered tools have streamlined operations while offering highly personalised experiences. These efforts have increased recommendation success rates by 20%, reflecting the tangible impact of advanced AI capabilities.

In addition to its technological achievements, John Yang, head of private banking division, remarked that CTBC has pioneered initiatives to democratise wealth management, ensuring accessibility for diverse customer segments. Products like Penny Piggy have introduced micro-investment opportunities to younger clients, while the bank’s digital donation platform and eco-friendly services showcase its commitment to sustainability. These comprehensive strategies highlight CTBC’s vision to lead not only in profitability but also in shaping a sustainable and inclusive future for financial services.

As CTBC Bank prepares for the challenges of 2025, it continues to focus on raising the bar for innovation, customer engagement and environmental responsibility.

Performance overview

CTBC Bank’s performance in 2024 reinforced its leading position in Taiwan’s retail banking sector. The bank achieved significant milestones across several key indicators, driven by its “One Bank” strategy, which fosters synergy between various business lines and services. With over 11 million customers—an annual growth of 2.5%—CTBC saw increases of 6% in assets under management (AUM), 11% in home loan balances, and 8% in card spending volume. These achievements contributed to the bank’s claim as the top bank in Taiwan’s Net Promoter Score (NPS).

Yang attributed these results to a relentless focus on customer-centric segmentation. "By refining our understanding of customer behaviours and needs, we’ve been able to offer tailored products and services that resonate with every segment, from young professionals to high-net-worth individuals (HNWIs)," she explained. Yang emphasised that this segmentation strategy has enabled CTBC to dynamically adjust its wealth management offerings in response to macroeconomic conditions, such as slowing interest rate hikes.

Synergy and efficiency as drivers

Yang added that CTBC’s comprehensive product portfolio and omni-channel services were also pivotal to success. The bank’s integration of physical and digital channels—part of its “One Bank” approach—ensures a seamless customer experience. “Our ability to blend digital empowerment with strong branch services allows us to deepen customer relationships,” Yang added. This strategy not only boosted engagement but also facilitated efficient operations, with technology playing a key role in lowering the cost-to-income ratio.

Wang emphasised how AI has driven these efficiencies. “We’ve enhanced our technology to complement human services, enabling us to handle a larger customer base without proportionately increasing costs,” he explained. This integration of AI tools has streamlined processes, improved cross-selling opportunities and contributed to a 25% success rate in converting targeted customer segments, compared to traditional methods achieving just 35% to 4%.

Standing out amid competition

Wang believes CTBC is able to differentiate itself in a crowded market through its extraordinary digital infrastructure and professional brand image. With innovations like the Insurance Navigator, the bank has simplified complex processes for customers, such as policy management and financial planning. This tool, praised for its user-friendly design, allows customers to import and analyse their policies digitally, bridging a significant gap in convenience.

Moreover, CTBC’s emphasis on brand awareness and trust has further set it apart. “Taiwanese customers consistently choose us for more complex financial needs because they trust our expertise and legacy,” said Wang. This trust is evident in the bank’s ability to attract and retain customers across multiple segments, from younger generations drawn to digital-first products like Penny Piggy to older demographics who value comprehensive advisory services.

Challenges and adaptability

Despite these achievements, the bank faced challenges in meeting the needs of a large and diverse customer base. As Wang noted, “One of our greatest challenges is covering all customer needs in a labour-intensive industry while maintaining high standards of service.” To address this, the bank has invested heavily in digital solutions and AI to balance efficiency with personalisation.

By the end of 2024, Yang shared that CTBC Bank had not only surpassed its financial targets but also laid the groundwork for continued growth. Its ability to innovate and adapt has ensured it remains a formidable market player, providing customers with tailored services while addressing the evolving landscape of retail banking.

Digital transformation with generative AI

At the heart of CTBC’s strategy in 2024 was its commitment to leveraging GenAI to redefine customer engagement and operational efficiency. The bank’s advanced AI systems are transforming how it interacts with customers, while simultaneously driving internal productivity gains.

AI-driven customer engagement

CTBC’s AI capabilities are most visible in its customer-facing tools, such as the Insurance Navigator. This innovative application allows customers to seamlessly manage their policies by importing them digitally, tracking coverage gaps, and receiving customised financial advice. Wang highlighted the importance of simplifying policy management. “Without tools or expert guidance, it’s nearly impossible for customers to understand the big picture of their policies,” Wang explained, emphasising how the Navigator addresses this challenge. The bank's focus on usability is evident, with 150,000 customers utilising the service, showcasing its widespread appeal.

GenAI also powers CTBC’s recommendation engines, which analyse customer preferences to provide personalised financial solutions. As Wang, head of digital technology, noted, “Our recommendation engines, enhanced by generative AI, have improved success rates by 20%, enabling us to anticipate and meet customer needs more effectively.” These AI-driven interactions reflect the bank’s broader emphasis on personalisation, ensuring each customer’s experience is tailored to their unique requirements.

Boosting internal productivity

CTBC’s adoption of GenAI extends beyond customer interactions. Internally, AI tools like Microsoft Copilot have changed how employees manage tasks such as drafting reports, taking meeting minutes and translating documents. “It's helping us rewrite the customer interaction model,” Wang explained, adding that the Copilot system has identified over 150 use cases and improved operational efficiency by up to 70%. This system has become indispensable for the bank, streamlining workflows and reducing manual effort across departments.

Fraud detection is another area where AI has delivered measurable results. By analysing over 300 behavioural characteristics, CTBC has successfully reduced fraud cases by 3.3% year-on-year. “With generative AI, we’ve been able to monitor a vast array of financial behaviours, enabling us to stay ahead of fraudsters,” Wang stated, highlighting the bank’s proactive approach to safeguarding its customers.

Innovations and challenges

CTBC’s use of GenAI extends to experimental projects designed to further enhance customer experiences. For instance, the bank is piloting a conversational AI assistant capable of providing financial advice based on a customer’s mood, preferences, and real-time interactions. While the tool is still under development, its potential to transform customer engagement is immense. “We are working to overcome challenges like AI hallucinations and ensuring regulatory compliance before a full rollout,” Wang acknowledged.

Despite these challenges, CTBC has invested heavily in the infrastructure necessary to support its AI ambitions. The bank operates 65 servers, each equipped with eight graphical processing units (GPUs), to power its large language models. Wang noted the importance of optimising these models to improve return on investment (ROI). “By transitioning from a 70-billion-parameter large language model to a nine-billion-parameter model, CTBC achieves significant cost efficiency without compromising much of the performance. Additionally, embracing the trend toward small language models (SLM) positions us to further enhance the ROI of AI solutions,” he explained.

A vision for the future

As CTBC continues to refine its AI strategy, the focus remains on integrating technology with human expertise. This hybrid approach ensures that while AI enhances efficiency and personalisation, the human touch remains central to customer experiences. “Our ability to combine digital empowerment with trusted human advisory services sets us apart,” Wang said, underscoring the bank’s commitment to balancing innovation with tradition.

Looking ahead, CTBC’s GenAI initiatives are poised to drive even greater transformation. From developing AI-assisted financial planning tools to expanding digital channels, the bank’s vision of becoming the “Best AI-Powered Bank” by 2025 reflects its ambition to lead the industry in technological and customer-centric advancements.

Customer-centric wealth management

CTBC has placed customer-centricity at the core of its wealth management strategy, offering tailored solutions that cater to the diverse needs of its clientele. From young professionals to HNWIs, the bank has deployed innovative tools and personalised services to ensure every segment is effectively served.

Democratising wealth management

One of CTBC’s notable initiatives in 2024 was the launch of the Penny Piggy platform, designed to make wealth management accessible to younger customers. This micro-investment tool allows users to start with as little as NTD 1,000 (about $30.80), with zero service fees and high flexibility through daily deductions. According to Yang, this product reflects the bank’s commitment to inclusivity. “Our goal is to lower barriers to entry for younger generations and foster early financial literacy,” Yang explained. The platform has attracted a significant share of new customers, with over 90% of them being under the age of 40.

Another innovative offering is CTBC’s dual-intelligent investment platform, which combines AI with expert advisory services. With a positive return rate exceeding 95%, the platform has become one of the sought-after options for customers seeking reliable and data-driven investment solutions. Yang emphasised the importance of blending technology with human expertise. “AI enables us to provide accurate insights, but our human advisors ensure these insights are aligned with the client’s financial goals,” he noted.

Tailored offerings for diverse segments

CTBC has also made strides in personalising its wealth management services. Using advanced customer profiling, the bank has segmented its clientele into specific groups, each with tailored product offerings. For HNWIs, CTBC provides comprehensive financial planning services, including estate management and legacy solutions. The bank’s personal trust services, led by Albert Hung, offer bespoke structures for wealth preservation, ensuring clients can efficiently plan for future generations.

To address the unique needs of its older customers, CTBC has implemented age-friendly initiatives, such as ATMs with larger font sizes and dedicated in-branch assistance. These efforts align with the bank’s broader mission of inclusivity. “We recognise that our customers’ needs evolve with age, and it’s our responsibility to adapt our services accordingly,” Hung explained.

Enhanced advisory and digital integration

CTBC has integrated AI-powered tools into its advisory framework to enhance service delivery. One such innovation is the Intelligent Portfolio Insight Engine, which provides clients with customised asset allocation recommendations based on their risk tolerance and investment horizon. As Wang noted, “This tool empowers our advisors to offer actionable insights, ensuring clients make informed decisions.”

In addition to enhancing in-person services, CTBC has expanded its digital channels to ensure accessibility. With over 385,000 customers now using its digital wealth services, the bank has successfully bridged the gap between traditional and modern banking. “Our digital tools are not a replacement for human advisors but a complement that allows us to scale our services without compromising quality,” Wang emphasised.

Empowering financial independence

CTBC’s approach to wealth management is rooted in its belief in empowering customers to take charge of their financial futures. By combining technology with personalised advisory services, the bank has created a framework that is as inclusive as it is effective. From young investors to seasoned professionals, CTBC seeks to ensure that every client has the resources and support they need to achieve their financial goals.

Sustainability and financial inclusion

CTBC seeks to establish itself as a leader in sustainability and financial inclusion by embedding these principles into its core strategy. The bank’s efforts in 2024 reflect a commitment to creating value not just for its customers but also for the broader community and environment.

Pioneering green banking initiatives

CTBC has taken significant steps to reduce its environmental footprint. Through its digital-first approach, the bank has saved over 850 million tonnes of paper annually, equivalent to the mass of more than 16 Taipei 101 buildings. The introduction of energy-efficient ATMs with larger fonts and fraud alarm systems exemplifies the bank’s focus on eco-friendly innovation. These machines not only enhance accessibility but also contribute to carbon reduction, with over 200 tonnes saved each year.

According to Wang, these initiatives are integral to CTBC’s sustainability strategy. “We believe that every action, no matter how small, contributes to a larger impact,” Wang remarked. By integrating ESG (environmental, social and governance) principles into its operations, the bank has developed a self-scoring ESG model, verified by ISO 14067 standards, to ensure accountability and transparency.

Inclusive financial services

CTBC’s commitment to financial inclusion is evident in its initiatives tailored to underserved and vulnerable groups. The bank has introduced services like age-friendly ATMs, with larger fonts among other features, and specialised customer support for senior citizens, ensuring financial services are accessible to all. Additionally, its digital donation platform has gained traction, with monthly contributions reaching NTD 2.6 million (about $80,110), supporting local charities and causes.

Hung, vice president of personal trust, highlighted CTBC’s dedication to addressing diverse customer needs. “We aim to provide solutions that resonate across demographics, from Gen Z to retirees,” Hung explained. This ethos is reflected in products like Penny Piggy, which encourages youth to start saving and investing with low entry barriers.

Bridging digital and physical worlds

CTBC’s inclusive approach extends to its digital ecosystem, which seamlessly integrates online and offline services. The bank’s gamification strategies have engaged over 5.6 million users, incentivising sustainable behaviour through digital coupons and rewards. These efforts have positioned CTBC as a trailblazer in combining technology with social responsibility.

A model for the future

CTBC’s focus on sustainability and financial inclusion sets a precedent for other financial institutions. By aligning its business practices with environmental and social goals, the bank is not only addressing current challenges but also laying the groundwork for a more equitable and sustainable financial system.

Challenges and future prospects

As CTBC continues to innovate and expand, it faces challenges inherent to the fast-paced and competitive financial industry. However, its strategies and vision for the future position the bank to overcome these obstacles in the years to come.

Navigating operational challenges

One of CTBC’s primary challenges lies in balancing efficiency with the personalisation of services. As Wang noted, “One of our greatest challenges is covering all customer needs in a labour-intensive industry while maintaining high standards of service.” This is particularly critical given the bank’s diverse customer base, ranging from Gen Z investors to HNWIs requiring bespoke financial solutions.

The integration of GenAI into operations has been a significant step towards addressing these challenges. AI tools have enabled CTBC to process large volumes of customer inquiries efficiently while maintaining the quality of interactions. Despite these advances, Wang acknowledged the hurdles of scaling AI solutions, including cost-efficiency and the risk of AI hallucinations. “Reducing the size of large language models from 70 billion parameters to nine billion has been a game-changer for GPU efficiency,” Wang explained, highlighting the importance of resource optimisation.

Anticipating market trends

Looking ahead, CTBC is closely monitoring trends such as the increasing demand for digital engagement and the growing importance of sustainable banking practices. Yang emphasised the role of personalisation in the bank’s future plans. “By combining advanced AI capabilities with trusted human advisory services, we can redefine how we deliver value to our clients,” he stated. This dual approach ensures that while technology drives efficiency, human advisors remain central to customer relationships.

The bank also aims to strengthen its position in wealth management by expanding its portfolio of AI-driven financial planning tools. With initiatives like the Intelligent Portfolio Insight Engine and advanced ESG scoring models, CTBC is setting the stage for a more data-driven and sustainable approach to financial services.

Vision for 2025 and beyond

CTBC’s ambition to become the “Best AI-Powered Bank” by 2025 reflects its commitment to staying at the forefront of the financial industry. As part of this vision, the bank plans to enhance its omnichannel capabilities, integrating digital and physical services seamlessly. “Our goal is to create a banking experience where every interaction feels personalised and intuitive, whether it’s online or in-person,” Wang remarked.

Through its forward-thinking strategies, CTBC is not just preparing for the future—it is actively shaping it through innovation, sustainability and customer engagement in retail banking.

A blueprint for success

CTBC’s performance and innovations in 2024 showcase a financial institution that is not only thriving in a competitive market but also setting new standards for the retail banking industry. By blending GenAI technology with a customer-centric approach, CTBC is redefining how financial services are delivered. This hybrid model of technology and human touch has allowed the bank to achieve higher personalisation, efficiency and scalability.

Beyond technology, CTBC’s commitment to sustainability and inclusion has further reinforced its leadership position. Initiatives like Penny Piggy and age-friendly ATMs demonstrate the bank’s ability to address diverse customer needs while supporting broader societal goals. As Wang noted, “Our ability to combine digital empowerment with trusted human advisory services sets us apart.”

Looking ahead, CTBC’s vision to become the “Best AI-Powered Bank” by 2025 reflects its determination to stay ahead of industry trends while maintaining a steadfast commitment to its customers and the community. With its innovative strategies, the bank is not just navigating the future of retail banking—it is shaping it.

CTBC’s journey offers a blueprint for success, proving that a forward-thinking approach grounded in sustainability and innovation can redefine what it means to lead in the modern financial landscape.