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Royal Bank Of Canada To Acquire HSBC Bank Canada For C$13.5 Bln In Cash

Royal Bank of Canada or RBC (RY,RY.TO) announced Monday an agreement to acquire 100 percent of the common shares of HSBC Bank Canada, a premier Canadian personal and commercial bank, for an all-cash purchase price of C$13.5 billion. All of HSBC Canada's earnings from June 30, 2022 through close will accrue to RBC.

The acquisition will enhance RBC's competitiveness on the global stage without compromising Canadians' access to a competitive, diverse market here at home.

The acquisition is expected to be approximately 6% earnings per share accretive relative to 2024 consensus estimates for RBC.

RBC expects to achieve approximately C$740 million, or 55%, in fully realized annual pre-tax expense synergies based on HSBC Canada's estimated 2024 non-interest expense base. It also expects to incur total acquisition and integration costs of approximately C$1 billion.

RBC will purchase all of the existing preferred shares and subordinated debt of HSBC Canada held directly or indirectly by HSBC Holdings plc at par value.

The acquisition is expected to close by late 2023, subject to customary closing conditions including regulatory approvals, obtained in the ordinary course.

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