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Canadian banks CIBC and TD have bought up promising startups this week, as the race to become the most innovative bank in the Great White North continues.

CIBC signed a deal to snap up Wellington Financial, a firm which provides growth capital to early and mid-stage technology companies. It’s set to become part of CIBC’s Innovation Banking unit, focused on giving advice and funding to clients in the technology sector.

CEO and president of Wellington Financial, Mark McQueen, will become president and executive managing director of CIBC Innovation Banking. According to the company’s website, McQueen led the firm’s growth from its inception as a CA$7 million ($5.63 million) fund in 2000 to its current CA$300 million ($241 million) fund size.

Related: CIBC breaks 20-year partnership to launch new digital bank Simplii

TD (Toronto-Dominion Bank), Canada’s largest bank by assets, has acquired artificial intelligence startup Layer 6 AI. Michael Rhodes, group head of innovation, technology and shared services at the bank, said that the bank has been aiming to build its AI capabilities for some time, according to the Financial Post.

“The mass amounts of data with increases in computing power really give rise to the ability for machine learning, or artificial intelligence, to really play a much more prominent role,” he said.

Layer 6, based in Toronto, launched in 2016. The firm uses AI to analyse data and “anticipate” its client’s needs. The startup will keep its brand name and separate office in the city, but TD will become its sole customer and client.

See more: TD bank keeps moving with Moven

“If we go and we raised a ton of money from foreign investors, at some point along the way we essentially stop being a Canadian company even if we’re located here,” said Layer 6 co-founder Jordan Jacobs.

“This was an opportunity to build inside a global company that is Canadian, TD, and to help them leap to the front of the pack around the world in adopting AI.”

In October 2017 TD integrated US-based Kasisto’s chatbot platform into its mobile application. The bank is at the forefront of Canada’s drive to become a financial technology hub. The Vector Institute, which opened in March 2017 to foster innovation, is set to receive CA$80 million ($64.32 million) from more than 30 private sector companies.

by Alex Hamilton
Alex is Senior Reporter at IBS Intelligence, follow him on Twitter or contact him at: alexanderh@ibsintelligence.com
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