Clifford Cho has seen his share of businesses during his decade-plus years at Bank of America here in San Diego.

They range from huge corporations with hundreds of employees to the sole proprietor with an office down the street.

But Cho, senior vice president and market executive leading a team of commercial bankers, says one of the more interesting types of business he’s encountered, surprisingly, are home-based retail operations run by a few people out of their spare bedrooms.

They can generate millions of dollars in sales but have few employees. Such companies rarely touch the products they sell.

Every step in the business process is handled by subcontractors, from the manufacturer at the factory overseas to the distributor in the U.S. who handles shipments to the customer.

Such web-based operations would have been unthinkable without the digital technologies that have been installed by the bank and its many competitors in recent years, says Cho.

And that’s the point.

Banks have had to invest heavily in new technologies to meet the demands of today’s business banking customer, especially the millennial generation (those born between 1981 and 1996) now entering the workforce.

Customer Preferences Drive Tech

Bank of America, for example, last year invested more than $16 billion in new technologies, according to financial industry services provider Celent.

That represents a tiny fraction of the bank’s $2.38 trillion in assets.

Other banks from the largest to the smallest like community business focused CalPrivate Bank in La Jolla and C3bank in Encinitas, have made investments.

They also include regional banks like Union Bank (see related story), which have their main offices elsewhere but a sizeable presence in San Diego.

Tom Wornham, chief executive officer at CalPrivate Bank, says the arrival of the millennial generation has driven many of the changes underway at his bank, which includes multiple new investments in technology.

This is the generation that’s grown up with technology, especially the smartphone, and they want to access the latest in products and services from their mobile devices.

“Millennials have been much maligned, but they are a huge demographic in today’s workplace,” said Wornham.

“I would liken them to Great Depression-era kids who saw members of their family and other families lose houses and jobs in the financial turmoil.” said Wornham. “The same thing happened during the recent Great Recession. Millennials have been slow to buy into the idea that they would have only one job, one employer. But they’re starting to settle down, become first time homebuyers, which is great. And they’re very entrepreneurial.”