Royal Bank of Canada (RBC) has completed the acquisition of City National, a US-based lender which serves HNW clients.
City National with $33.8bn in assets has 75 offices in California, Nevada, New York City, Nashville and Atlanta.
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RBC said that based on the closing price of its shares on the New York Stock Exchange on 30 October 2015, the transaction is valued at US$5bn and will be paid with US$ 2.6bn in cash and 41.6 million RBC common shares.
The acquisition is expected to reduce the RBC’s Q1/2016 Common Equity Tier 1 ratio by approximately 70 basis points.
RBC added that it will combine its US Wealth Management unit and City National into one line of business to be reported as part of the RBC Wealth Management segment.
Russell Goldsmith, CEO of City National, will lead the combined line of business from Los Angeles, where City National is headquartered and where it will continue to operate under the City National name.
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By GlobalDataRBC president and CEO Dave McKay said: "City National is a great addition to RBC and today we welcome its 3,600 colleagues. I’m excited about combining our capabilities to deepen client relationships and to serve a broader client base with the aim of being the preferred provider in the U.S. to corporate, institutional, commercial and high-net worth clients and their businesses.
"Ultimately, our strategy is underpinned by a foundation of helping clients thrive, communities prosper and employees succeed."
