RBC Eyes Growth for City National Bank with Eye on Texas
Royal Bank of Canada (RBC) has its sights set on growing City National Bank, its US banking franchise. The Canadian bank's CEO, Dave McKay, said that while organic growth opportunities abound for City National, M&A is also an option if it creates 'meaningful shareholder value'.
City National has been adding bankers in high-growth markets in the Southeast and is now eyeing Texas as a potential target. The subsidiary has weathered a tough stretch in 2023 but has since seen its net income rise 61% year-over-year to $184 million.
RBC's growth plan for City National includes expanding its presence in the Southeast, with offices recently opened in Charlotte and Greenville. McKay emphasized that any M&A deal would need to align with RBC's goal of creating shareholder value, rather than simply growing the franchise.
City National's performance has improved in recent quarters, with net income rising 61% year-over-year to $184 million. The subsidiary's average deposits rose 5%, while wholesale loans increased by 7%, and retail loans rose by 9%. RBC's total US operations saw a 30% increase in net income year-over-year.