Royal Bank of Canada Plans UK Commercial Banking Push, But Rules Out For This Business

  • Royal Bank of Canada RY is reportedly planning a push into the U.K.’s commercial banking market through acquisition and will look for opportunities to expand wealth management. 
  • Chief executive Dave McKay told the Financial Times that he was keen to expand into commercial banking. 
  • “What we have in the U.S., that we don’t have in the UK, is a strong commercial banking capability,” McKay said. “That’s really the core of City National Bank, a strong commercial private bank. We would like to replicate that model [in the UK].” 
  •  RBC’s Brewin Dolphin deal shows the bank’s ambitions in U.K. wealth management. “It vaults us to third-largest wealth manager in the UK, behind St James’s Place and Rathbones,” McKay said.
  •  McKay said RBC could also look at smaller wealth management deals in Britain. “Once we get the [Brewin Dolphin] integration well along the way, we will look for opportunities to acquire other smaller players and put them on the platform,” he added.
  • However, McKay ruled out entering UK retail banking. “We have no ambition to be a digital retail bank, or a physical retail bank, outside of Canada,” he said.
  • Price Action: RY shares are down 0.10% at $90.72 during the premarket session on the last check Tuesday.
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