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Financial institution From Wikipedia, the free encyclopedia
Royal Bank of Canada (RBC; French: Banque Royale du Canada) is a Canadian multinational financial services company and the largest bank in Canada by market capitalization. The bank serves over 20 million clients and has more than 100,000 employees worldwide.[2] Founded in 1864 in Halifax, Nova Scotia, it maintains its corporate headquarters in Toronto and its head office in Montreal.[2] RBC's institution number is 003. In November 2017, RBC was added to the Financial Stability Board's list of global systemically important banks.
 | |
 Royal Bank Plaza in downtown Toronto | |
| Company type | Public |
|---|---|
| ISIN | CA7800871021 |
| Industry | Financial services |
| Founded | 1864[1] in Halifax, Nova Scotia |
| Headquarters | Montreal, Quebec, Canada Toronto, Ontario, Canada[2][note 1] |
Key people | David I. McKay (President and CEO)[4] |
| Services | |
| Revenue |  CA$56.13 billion (2023)[5] |
 CA$14.87 billion (2023)[5] | |
| AUM | CA$1.07 trillion (2023)[5] |
| Total assets | CA$2.0 trillion (2023)[5] |
| Total equity | CA$117.76 billion (2023)[5] |
Number of employees | 94,000 (2023)[5] |
| Subsidiaries | Brewin Dolphin |
| Website | rbc |
In Canada, the bank's personal and commercial banking operations are branded as RBC Royal Bank in English and RBC Banque Royale in French and serves approximately 11 million clients through its network of 1,284 branches. RBC Bank is a US banking subsidiary which formerly operated 439 branches across six states in the Southeastern United States,[6] but now only offers cross-border banking services to Canadian travellers and expats. RBC's other Los Angeles-based US subsidiary City National Bank operates 79 branches across 11 US states.[7] RBC also has 127 branches across seventeen countries in the Caribbean, which serve more than 16 million clients.[8] RBC Capital Markets is RBC's worldwide investment and corporate banking subsidiary, while the investment brokerage firm is known as RBC Dominion Securities. Investment banking services are also provided through RBC Bank and the focus is on middle market clients.
In 2011, RBC was the largest Canadian company by revenue and market capitalization.[9] In 2023, the company was ranked 38th in the Forbes Global 2000.[10] The company has operations in Canada and 36 other countries,[11] and had CA$1.01 trillion of assets under management in 2021.[5][12]
In 1864, the Merchants Bank of Halifax was founded in Halifax, Nova Scotia, as a commercial bank that financed the fishing and timber industries and the European and Caribbean import/export businesses.[13] By 1869 the Merchants' Bank was officially incorporated and received its federal charter in the same year.[14] During the 1870s and 1880s, the bank expanded into the other Maritime Provinces. When both the Newfoundland Commercial Bank and Union Bank of Newfoundland collapsed on December 10, 1894, the Merchants Bank expanded to Newfoundland on January 31, 1895.[14]
As the bank grew, executives changed its name to reflect its growth and western expansion.[13] In 1901, the Merchants Bank of Halifax changed its name to the Royal Bank of Canada (RBC). The centre of the Canadian financial industry had moved from Halifax to Montreal, so the Merchants Bank relocated its head office there. In 1910, RBC merged with the Union Bank of Halifax. In the same year it built a bank branch in Winnipeg, Manitoba, designed by Carrère and Hastings, in beaux-arts classicism proclaiming the financial dominance of Winnipeg in the prairies.[15] To improve its position in Ontario, RBC merged with Traders Bank of Canada in 1912 and in 1917 RBC merged with Quebec Bank, which was founded in 1818 and chartered in 1822 in Quebec City.
RBC's presence in Manitoba and Saskatchewan was strengthened through a 1918 merger with Northern Crown Bank, the product of the 1908 merger of Northern Bank (established in 1905 in Winnipeg) and Crown Bank of Canada (1904), based in Ontario. RBC's presence in the Canadian Prairie was further expanded by the 1925 merger with the Union Bank of Canada, which had begun in Quebec City in 1865 as the Union Bank of Lower Canada, but changed its name in 1886. The Union Bank of Canada had moved its headquarters to Winnipeg in 1912, and had built a strong presence in the Prairies and opened the first bank in the Northwest Territories at Fort Smith in 1921.[16][17]
In 1935, RBC merged with Crown Savings and Loan Co. merged with Industrial Mortgage & Trust Co.[18]
RoyWest Banking Corporation was formed in Nassau, Bahamas in 1965, to undertake medium-term lending and trustee business in the British West Indies.[19] Majority owned by seven firms, including RBC and Westminster Bank, sole ownership transferred to National Westminster Bank in 1987.[20]
RBC installed its first computer in 1961, the IBM 1401, the first to do so in Canadian banking.[21] In the 1960s, RBC Insurance was created.[13] In 1968, it merged with Ontario Loan and Debenture Company (formerly Ontario Savings and Investment Society).[22] RBC Insurance is the largest Canadian bank-owned insurance organization, with services to over five million people. It provides life, health, travel, home and auto and reinsurance products as well as creditor and business insurance services.[13] The completion of Royal Bank Plaza in Toronto in 1976 saw the relocation of many critical head-office functions from Montreal, with Toronto serving as RBC's corporate headquarters ever since.[23] In 1993, RBC merged with Royal Trust.
In 1998, RBC acquired Security First Network Bank in Atlanta—the first pure Internet bank.[24] In the same year, the Royal Bank of Canada proposed to merge with the Bank of Montreal, at the same time as the Toronto-Dominion Bank proposed to merge with the Canadian Imperial Bank of Commerce. Both mergers were examined by the Competition Bureau of Canada, and ultimately rejected by Paul Martin, at the time the Finance Minister of Canada, and future Prime Minister.
In 2000, RBC merged merchant credit/debit card acquiring business with the Bank of Montreal's to form Moneris Solutions. In 2013, RBC completed the acquisition of the Canadian subsidiary of Ally Financial.[25]
An RBC branch in The Glebe neighbourhood of Ottawa was firebombed in May 2010. The party responsible later identified themselves on Independent Media Center and threatened to make their presence at the upcoming 2010 G20 Toronto summit.[26]
In November 2022, RBC and HSBC Canada announced a deal which would see RBC acquiring 100% of the common shares of HSBC Canada for an all-cash purchase price of $13.5 billion, a multiple of 9.4 times HSBC Canada's estimated 2024 earnings. Completion of the transaction is expected by late 2023, subject to regulatory approvals.[27] In December 2023, RBC received approval from Finance Minister Chrystia Freeland to take over HSBC Bank in a deal. Conditions for the deal include that none of HSBC Canada's 4,000 employees will be laid off within six months of the closing date or two years for direct staff, and banking services will be provided at 33 HSBC branches for at least another four years. RBC will also provide $7 billion in financing for affordable housing developments in Canada.[28]
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The bank's first modern identity was designed by firm Lippincott & Margulies, and was introduced in January 1962. From this point forward the bank's logo has contained the same basic element of a stylized lion clutching a globe, becoming more simplified with each iteration. Alongside promotion of the Royal Bank Plaza, a tweaked version of the mark by Montreal design consultancy Gottschalk + Ash silently debuted in June 1979. The same basic form was retained, however many lines were thickened and details simplified to facilitate printing at small sizes. The total brand overhaul and shortening of the Royal Bank name to RBC in August 2001 coincided with their expansion into the United States market.[46] The direction of the lion, now further simplified, was reversed, the crown above omitted, and both the symbol and wordmark were placed within a blue shield.
RBC sponsors cultural events including the Toronto International Film Festival. It also sponsors the RBC Taylor Prize, a literary award for non-fiction writing in Canada, and hosts a yearly Canadian Women Entrepreneur Award.[47][48] In July 2013, the RBC Foundation partnered with the University of Toronto to revive the Siminovitch Prize in Theatre, given to recognize achievement in Canadian theatre.[49][50][51]
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RBC is one of Canada's largest sponsors of amateur sports and is the longest-running Canadian sponsor of the Olympic Games. It employs dozens of top-tier amateur athletes as part-time spokespeople through the RBC Olympians program. RBC is a former premier sponsor of Hockey Canada and previously owned the naming rights to the National Junior A Championship, then called the Royal Bank Cup (later the RBC Cup). In addition, it supports Canadian hockey at the grassroots level through the RBC Play Hockey program.
RBC owns naming rights to the RBC Centre, RBC Convention Centre Winnipeg, RBC Canadian Open, and RBC Heritage (formerly the Heritage Classic). From 2002 to 2012, RBC previously held the naming rights to what is now the PNC Arena in Raleigh, North Carolina.[52]
RBC has owned naming rights for the Top 25 Canadian Immigrants Award, presented annually by Canadian Immigrant, since 2013.[53]
The head office for the institution was initially located at the Merchants' Bank of Halifax Building, on Bedford Row, Halifax, Nova Scotia. The building served as the head office for the bank from 1864 to 1907. In 1907, the RBC relocated its head office to the Four Pillars Building, at 147 Saint Jacques Street (renumbered 221 in 1928), Montreal. The building was used as RBC's head office until 1928. The Four Pillars Building was later demolished, with only its facade remaining.[54] In 1928, RBC moved its head office to the Old Royal Bank Building, at 360 Saint Jacques Street, Montreal.
In 1962, RBC moved its head office to Place Ville-Marie, at University Street and René-Lévesque Boulevard in Montreal. In 1976, RBC completed Royal Bank Plaza, at 200 Bay Street, Toronto, and shifted the majority of its critical head-office functions from Montreal to Toronto.[55] The Royal Bank of Canada presently operates two headquarters, with its corporate headquarters at Royal Bank Plaza and its head office based at Place Ville-Marie.[2] Most of its management operations are based in Toronto.[3]
On April 5, 2024, RBC terminated CFO Nadine Ahn and Ken Mason (vice president and head of capital and term funding) over an undisclosed personal relationship that led to the latter receiving preferential treatment including a promotion and compensation increases.[56]
On January 15, 2007, CBC Radio reported RBC was "refusing" to open US dollar accounts for people of certain nationalities.[57] Canadian citizens with dual citizenship in Cuba, Iran, Iraq, Myanmar, North Korea or Sudan (mostly countries with US sanctions) were affected. The US Treasury Department restricts certain foreign nationals from using the US dollar payment system to limit terrorism and money laundering after the September 11, 2001, attacks. RBC replied that compliance with such laws does not represent an endorsement by the bank and on January 17, clarified its position on the application of the US laws, specifying that "with some exceptions" it does open accounts for dual citizens of the sanctioned countries.[58] There have also been reports that the bank had closed the accounts of some Iranian-Canadian citizens.[59]
According to a report by Rainforest Action Network, RBC's financing of oil sands bitumen extraction and expansion amounted to "more than $2.3 billion in loans and financing [of] more than $6.9 billion in [corporate] debt between 2003 and 2007 for 13 companies including: Encana, Husky Energy, OPTI Canada, Delphi Energy, Canadian Oil Sands Trust, Northwest Upgrading, Suncor, TotalEnergies, Connacher Oil and Gas, InterPipeline and Enbridge".[60]
A 2020 report on fossil fuel finance by the Sierra Club and Rainforest Action Network found that RBC was the fifth largest funder of fossil fuels in the world, and largest in Canada, investing over US$160 billion on fossil fuel projects since the Paris Agreement in 2015.[61] This sparked criticism from environmental groups and climate activists.[62]
A more recent 2023 report from a coalition of environmental group places RBC as the largest financier of fossil fuel in the world in 2022, investing US$42 billion in fossil fuel projects in that year alone.[63][64]
RBC invested in SCO Group during the series of court cases seeking to collect royalties from the users of Linux.[65]
In 2014, the Commodity Futures Trading Commission fined RBC $35,000,000 for engaging in more than 1,000 wash sales, fictitious sales, and other non-competitive practices over a three year period.[66]
In 2007, the Royal Bank of Canada fired several traders in its corporate bond business, after another trader accused them of mismarking bonds the bank held by overpricing them, and marked down the values of the bonds and recognized $13 million of trading losses relating to the bonds.[67] The bank said it investigated the accusations, and took remedial action.[67] The Globe and Mail noted: "traders might have an incentive to boost [the bonds'] prices because it could have an impact on their bonuses."[67]
In April 2013, the CBC reported that the Royal Bank of Canada was indirectly hiring temporary foreign workers to replace 45 Canadian information technology workers.[68]
The CBC reported on May 7, 2013 that, during Question Period in Parliament, the NDP leveled accusations against the government and then Prime Minister Stephen Harper. Harper responded that the government has been working on problems with the Temporary Foreign Worker Program for more than a year.[69]
On December 29, 2022, the Supreme Court of Ontario certified a class action lawsuit permitting employees of RBC Dominion Securities to seek $800 million in damages, over alleged unpaid wages for holidays and other vacation days.[70]
RBC is a member of the Canadian Bankers Association which includes Canada's Big Five banks, and is a registered member with the Canada Deposit Insurance Corporation, a federal agency insuring deposits at all of Canada's chartered banks.
It is also a member of:
The office of Chairman of the Board was created in October 1949 for outgoing president Sydney Dobson. Until 2001, the chairmanship was given to the current or former president. After John Cleghorn's retirement in 2001, the chairmanship was made a separate, non-executive position.
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