Morgan Stanley digital signage is displayed on the exterior of the company's headquarters in New York, U.S., on Tuesday, July 12, 2016.
Photograph by Eric Thayer—Bloomberg via Getty Images

It's also been trying to lend more to wealthy customers.

By Reuters
January 17, 2017

Morgan Stanley inked deals with 10 technology outfits last year to improve the products and services it offers wealth-management customers, the bank said on Tuesday.

Among the new partners are Addepar, which offers investment-tracking software, and Zelle, a digital payments network that aims to compete against the popular mobile application Venmo.

Although the tools will not necessarily generate fees, they will help financial advisers do their jobs better, Morgan Stanley Chief Executive James Gorman said. They may also attract and retain customers who prefer digital options, he added.

“We’ve got to be careful that we are not penny wise and pound foolish,” he said.

Big banks, investment firms, and brokerages have been investing heavily in financial technology lately to avoid losing customers to Silicon Valley.

In the wealth-management business, the most common threat has been so-called “roboadvisors,” like Wealthfront and Betterment, which manage clients’ money using algorithms. They tend to charge less than human advisers and cater to customers with relatively little money to invest.

Morgan Stanley’s wealth business is sticking to a model that favors wealthier customers, Gorman said. However, he left the door open to serving those who want purely digital advice, and said he expects all customers to want cutting-edge digital options going forward.

“We will be building a lot of digital technology to support the financial advisors and the branch operations,” he said.

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In December, Morgan Stanley said 20 of its top adviser teams would use Addepar’s software to track wealthy clients’ assets across all of their accounts—even those outside Morgan Stanley—to manage their assets better.

Zelle, the peer-to-peer payments app, was developed by a group of big banks including J.P. Morgan Chase jpm and Bank of America bac . It plans to launch later this year.

In an earnings-related document, Morgan Stanley listed several other technology firms including cloud-based messaging service Twilio, data-analytics provider Cloudera, and tax-software maker LifeYield, as partners it is using to modernize branches, communicate with customers and target clients who prefer digital options.

Morgan Stanley has also made a number of key hires to build out its digital department, including Naureen Hassan, who joined as chief digital officer for the wealth business from Charles Schwab schw last year.

The focus on technology is part of a broader strategy to increase profit margins in Morgan Stanley’s wealth business to a range of 23% to 25% by next year, from a current 22%.

As Gorman tells it, the technology can encourage customers to do more business with Morgan Stanley and allow advisers to use their time in more productive ways. Gorman feels “strongly” that Morgan Stanley will hit the 2017 target, he said.

Morgan Stanley has also been trying to increase lending to wealthy customers to bolster its bottom line.

Since taking full control of the Smith Barney brokerage from Citigroup c in 2012, Morgan Stanley acquired a lush amount of deposits. It is working to put them to use through mortgages, lending against customers’ investment portfolios and tailored loans that use fine art and other luxury items as collateral.

Over the course of 2016, Morgan Stanley grew loans to wealth customers by 24%, to $55.3 billion.

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