Royal Bank has agreed with HSBC Bank to acquire its Canadian operations for $13.5 billion.
The transaction is subject to government and regulatory approvals and closing is expected by the end of next year.
This announcement comes as the six major Canadian banks publish their year-end performance this week.
“HSBC Canada allows us to add complementary customers and businesses in the market we know best and where we can deliver high returns and deliver value to our customers,” said Royal CEO Dave McKay.
“This transaction also positions us as the bank of choice for business customers with international needs, newcomers to Canada and affluent customers who require global banking and wealth management capabilities. It will help us better meet the needs of clients around the world who want to invest and grow in Canada. »
The purchase price represents a 9.4x multiple of HSBC Canada’s estimated adjusted earnings for 2024 of $1.4 billion assuming fully realized cost synergies.
HSBC Canada has $134 billion in assets, 130 branches and 4,200 full-time equivalent employees, including 450 in Quebec.
HSBC Canada is the seventh largest bank in the country and generated profits of more than 200 million during the months of July, August and September.