If there’s one lesson that everyone who toils in Canada’s financial services industry eventually must learn, it’s to never underestimate the banks. It may take them longer than they’d like, but time and time again they’ve shown the ability to adapt and conquer.

The banks have one obvious advantage over their competition in almost every segment of the industry — and that’s scale. But size often doesn’t lend itself to superior customer service. Large organizations inevitably spawn big bureaucracies, which are notorious for defying common sense and botching even the most basic tenets of good client service.

In theory, then, high-touch investment businesses that prize quality advice and deep client relationships should be fairly safe from bank dominance. But the banks have proven very adept at overcoming their limitations and trouncing the competition in businesses in which their biggest advantage should also be their most significant weakness. They dominate the brokerage business, they have a stranglehold on the retail asset-management industry and they’ve become a force in financial planning.

The latest version of Investment Executive’s Account Managers Report Card finds that the banks are also figuring out how to integrate these strengths with their core banking business.

The banks have always had a large incumbent client base, and a vast array of services on offer, and therefore an incredible cross-selling potential. But it has proven much tougher, in practice, to bring the various parts of the bank together to meet all a client’s needs and capture a 100% share of their wallet.

Regulation is one impediment, but systems differences, bureaucratic intransigence, internal competition and ineffective incentive structures have all conspired to neutralize the banks’ advantage in the scope of services they can offer.

Yet, it seems, they are finally getting that right, too. Bankers report that their companies are doing better than ever at enabling them to pull together their vast resources to deliver high-quality service. Some banks have been more successful than others, but you have to expect that eventually they’ll all get it right.

There will always be a place for independents in the Canadian financial services industry, but as the banks relentlessly press their advantage, that space will inevitably shrink. Ignore these giants at your peril.