If you spotted an RBC on your commute this morning you could have sworn was an HSBC, don’t worry, you’re not going crazy…
Driving the news: We hope you’ve said your final goodbyes to HSBC’s Canadian arm, since this week you’ll find that dozens of HSBC branches transformed into RBCs overnight, marking the final stages of the 2022 $13.5 billion acquisition by the country’s largest bank.
- And in some places, you might not find a branch at all: RBC shut down 25 locations of the Hong Kong-based bank as part of its expansion.
Catch-up: The federal government approved the deal at the end of last year on the condition that RBC establishes a global banking hub in Vancouver, waives fees on the transfer of mortgages from HSBC to RBC and protects HSBC's entire Canadian workforce.
Why it matters: Although it wasn’t the biggest player in Canadian banking, HSBC was known for undercutting the Big Six bank’s prices on borrowing costs. Some experts say the loss of that competition could hurt Canadians, especially when it comes to mortgage rates.
- Experts say HSBC played a role in keeping mortgage costs at bay, with other banks charging interest rates of 0.2% to over 0.8% higher on fixed and variable loans.
Zoom out: The acquisition will give RBC a leg up in building an international clientele as the big banks race to add more clients to their books by targetting newcomers to Canada.—LA