He is excited about HSBC Canada and capital markets potential in US
RBC’s chief executive is upbeat about the Canadian big six bank’s growth trajectory as he eyes growth south of the border and the potential from the acquisition of HSBC Canada.
Speaking in Davos, where the ‘who’s who’ of world finance are gathering for the World Economic Forum’s annual meeting, Dave McKay said he is “incredibly excited” about the acquisition of HSBC Canada, with approval given just before the holidays and the deal slated to close at the end of March allowing the conversion of HSBC Canada clients over to RBC.
He said that the banking group’s currency is strong and that it has one of the strongest valuations among global banks and significant capital strength, but the HSBC Canada deal adds its cross-border connections, trade finance, and other international capabilities will add strength to RBC.
But McKay also acknowledged the benefits that HSBC Canada employees and clients will get from the investment in technology that RBC has made, giving them access to a new suite of tools, and the benefit to RBC shareholders from the expanded group.
RBC has plans to continue its global growth path which could be in the United States or Europe with wealth management a key focus for its acquisitions.
He mentioned that regulatory challenges in the U.S. are an issue, and he would like to see them resolved to create a level playing field between Canada and other global players to give greater certainty when considering a franchise expansion.
But he has not ruled out further expansion south of the border, although this is mostly through organic growth of the capital markets business through hiring and expanding sector coverage. Adding teams to its wealth management business in the U.S. and growing the California-based entertainment industry focused City National franchise.
