Royal Bank of Canada (RBC) has agreed to buy the Canadian arm of multinational financial service company HSBC for $13.5 billion.
The deal is the largest ever reached between two domestic banks in Canadian history.
RBC says the transaction is subject to “closing conditions,” including regulatory and government approvals before making the deal official.
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The deal would see RBC consolidate its position as the largest bank in Canada.
“HSBC Canada offers the opportunity to add a complementary business and client base in the market we know best and position us to be the bank of choice for commercial clients with international needs, newcomers to Canada and affluent clients who need global banking and wealth management capabilities,” says RBC President and CEO Dave McKay.
McKay says RBC is committed to “ensuring clients get the highest value and best service” going forward.
HSBC has had financial operations in Canada since 1981 and currently has 4,200 employees spread out across 130 branches.
HSBC Canada has about 2% of all the bank deposits and mortgages in Canada, according to its 2022 second-quarter results.
The deal is expected to be finalized in early 2023, pending regulatory and shareholder approval.
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