- Royal Bank of Canada (TSX:RY) has been approved to proceed with its acquisition of HSBC Bank Canada
- The bank received its approval, which will be subjected to terms and conditions imposed on RBC, from the Government of Canada
- The acquisition of HSBC comes after HSBC’s exit from Canadian markets in 2022
- Shares of Royal Bank of Canada are up 0.28 per cent to C$133.46 as of 10:47 am ET
Royal Bank of Canada (TSX:RY) has been approved to proceed with its acquisition of HSBC Canada by the Government of Canada.
In a news release, the company stated it received approval from the federal Minster of Finance, subject to strict terms and conditions imposed on the bank.
According to the Government of Canada, Royal Bank of Canada’s acquisition of HSBC comes after HSBC’s announcement in November 2022 indicating its exit from Canadian markets. The move came as part of restructuring its operations to expand globally, including the United States and Europe.
“The acquisition of HSBC Canada is good for the country and Canadians. Not only will this keep more of Canada’s financial sector under Canadian ownership, but it will also allow more Canadians to access the global economy by combining the strength and scale of RBC with the international banking capabilities and financial products that HSBC Canada is known for,” Dave McKay, CEO of Royal Bank of Canada, said in a statement.
Thanks to the approval, the two banks will now work to facilitate a transition to the Royal Bank for HSBC Canada’s clients and employees.
HSBC employees 4,000 people in Canada and provides banking services to roughly 780,000 Canadians,.
Under the terms of the transaction, the minister of finance has ensured HSBC will be protected by imposing commitments onto Royal Bank of Canada, including:
- Protecting HSBC’s Canadian workforce
- Establishing a new global banking hub in Vancouver that will support more than 1,000 jobs and create 440 net-new jobs in the province
- Increasing its client operations workforce in Winnipeg by 10 per cent
- Provide $7 billion in financing for affordable housing construction across Canada for an estimated 25,000 new homes
“By bringing the capabilities, international connections and exceptional talent of HSBC Canada to RBC, we are creating an enhanced banking experience for our clients, which includes new international products and innovative digital capabilities to help them achieve their financial goals,” Neil McLaughlin, group head, personal and commercial banking at Royal Bank of Canada, said in a statement.
Royal Bank of Canada provides personal and commercial banking, wealth management services, insurance, investor services and capital markets products and services on a global basis. Its segments include personal and commercial banking, wealth management, insurance, investor and treasury services, capital markets and corporate support.
Shares of Royal Bank of Canada are up 0.28 per cent to C$133.46 as of 10:47 am ET.
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