Royal Bank of Canada (RY) is buying the Canadian arm of international lender HSBC Holdings (HSBC) for $13.5 billion in cash.
The cost makes the deal the most expensive domestic acquisition ever for a Canadian bank.
HSBC has had operations in Canada since 1981 and currently operates 130 branches across the country and has 4,200 employees and 780,000 customers throughout the country.
According to its most recent quarterly filing, HSBC Canada had $125 billion worth of assets at the end of June, and an operating income of more than $1.1 billion in the first half of this year.
HSBC manages about 2% of all the bank deposits and mortgages in Canada.
The acquisition is expected to close in 2023, pending regulatory and shareholder approvals.
The purchase will be reviewed by several government agencies, including the Competition Bureau, Office of the Superintendent of Financial Institutions, and federal Finance Department.
Royal Bank’s stock is down 2% this year at $133.77 per share.
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