According to multiple media reports, the federal government in Ottawa will approve Royal Bank’s (RY) $13.5 billion acquisition of HSBC Canada’s operations.
Federal Finance Minister Chrystia Freeland’s office is preparing to issue a statement approving the deal ahead of the holidays.
Royal Bank had initially proposed buying HSBC Canada, the country’s seventh-largest bank, in November 2022.
The deal represents the largest-ever acquisition for Royal Bank. Already Canada’s biggest bank, Royal will now get even larger through the acquisition of HSBC’s 130 branches and $120 billion in assets.
The Competition Bureau, Canada’s antitrust watchdog, approved the deal in September, stating that the union wouldn’t result in a “substantial lessening or prevention of competition.”
However, the deal still requires approval from Minister Freeland’s office to proceed.
Consumer groups have raised concerns about the deal, saying it could lead to higher mortgage rates across Canada.
Royal Bank has said that it plans to close the deal in early 2024.
HSBC Holdings (HSBC) pulled out of the Canadian marketplace in 2022, putting its operations in the country up for sale as a result.
Royal Bank’s stock has increased 4% in 2023 to trade at $133.09 per share.
