For $13.5 billion in cash, Royal Bank of Canada (RBC) has agreed to acquire HSBC’s Canadian division.
The purchase, according to RBC Chief Executive Dave McKay, presents a chance to expand one’s clientele and business.
This places us in a better position to serve foreign business clients, immigrants to Canada, and wealthy clientele who require global banking and wealth management skills, according to a statement released by McKay on Tuesday.
It will enable us to better assist international clients seeking to expand and invest in Canada.
Because the parent firm has been under pressure to increase returns from its largest shareholder, China’s Ping An Insurance Group, the Canadian division of the British bank HSBC has been on the market this year.
In Canada, HSBC has 130 locations and 4,200 full-time employees.
Noel Quinn, the chief executive of HSBC Group, said in a statement that the acquisition “makes strategic sense for both parties and RBC will take the company to the next level.”
Our group’s overall strategy has not altered, and completing this deal will free up more money for growth investments in our core businesses and shareholder returns.
Since 1981, HSBC has operated in Canada; at present, it employs 4,200 people across 130 locations.
At the end of June, HSBC Canada reported an operating income of more than $1.1 billion and assets over $125 billion, according to its most recent quarterly report. About 2% of all bank savings and mortgages in Canada are held by HSBC.
In the event that regulators and shareholders approve the transaction, it should close the following year.