It opened its first Toronto branch in Its regional branches were, in essence, providing operating funds for loans to national companies located in that financial city. In order to grow business, bank managers realized they would have to follow an acquisition strategy.
They merged with the Union Bank of Halifax in , the Traders Bank of Canada in giving them access to the Ontario market , the Quebec Bank in , and Northern Crown Bank in , the latter of which gave them a strong presence in Western Canada.
The deal was the largest bank transaction to date in the country. It made RBC the biggest bank in Canada by assets — a position it has held, with the exception of —35, ever since. As RBC grew, it became particularly well-known for its administrative expertise. In , the bank hired the first ever chief economist for a chartered bank in Canada, Donald Marvin.
The management skills of the bank, together with its strict lending policies, saved the day. The turmoil of the Great Depression was followed by a period of conservative management in the banking sector overall. It opened an oil and gas department in Calgary in The banks collectively began to materially grow again in the s with a new focus on consumer lending.
All banks were aided by changes to the Bank Act in , which allowed them to issue mortgage loans for the first time. In , additional changes removed the 6 per cent interest rate ceiling they could charge on loans.
By , RBC had written more than half of the residential mortgage loans of all banks in the country. That same year, the bank partnered with Roy Fund Limited to begin offering mutual funds to its retail clients throughout Royal Bank branches. To accommodate its growing operations, RBC announced the construction of a new head office in , called Place Ville Marie.
In , RBC was the first in the banking industry to begin using a computer in its administration. It quickly became a leader in this business of international lending such that RBC bought out its partners in Today, the division operates under the name RBC Capital Markets and is one of the largest global investment bank operations in the world.
In other international ventures, RBC became the first Canadian bank to have a representative office in Beijing, China, when it opened in , and subsequently upgraded to a full branch in The bank entered the political arena in when it announced that it would move its head office operations from Montreal to Toronto. Corporate Governance. We are one of Canada's biggest banks, and among the largest in the world based on market capitalization.
We are one of North America's leading diversified financial services companies, and provide personal and commercial banking, wealth management, insurance, investor services and capital markets products and services on a global basis. See All Awards. Latest News. RBC Newsroom. Six years later, in partnership with three other banks, the bank introduced Chargex, a credit card that allowed holders to make purchases within a specified credit limit and obtain cash advances through any of four participating institutions.
The revision of the Bank Act sparked vigorous competition among Canada's chartered banks, which had long operated under a morass of special restrictions.
In removing or casing these constraints, the new act permitted banks to vie for loans, deposits, and conventional mortgages on an equal basis with other lending and borrowing institutions. By Royal Bank had written more than half of the residential mortgage loans provided by all of the chartered banks combined. In the early s, Royal Bank joined forces with five other banks to form Orion, a London-based merchant banking organization designed to enter the financial services market.
Although Canadian law prohibited banks from entering this market domestically, Orion competed successfully in placing international bond issues and securities.
Orion became a wholly owned subsidiary of the Royal Bank in , enabling the bank to diversify its operations up to the limits imposed by Canada's banking laws and position itself for the possibility of international banking deregulation. In Rowland Frazee, who had been with the bank for 40 years, was appointed chief executive officer.
He replaced W. Although one-third of that total was attributed to its international activities, the bank had lost its early advantage in many foreign markets to other institutions. One of Frazee's first orders of business was to strengthen the bank's influence in the United States. A second Frazee priority was the development of a Global Energy Group, based in Calgary, to provide technical consultation as well as capital for energy-related projects on an international basis.
To manage its newly aggressive stance, the bank reorganized into four groups, two responsible for Canadian retail and commercial business, and two to handle corporate banking and international operations.
Taylor's rise from junior clerk at the age of 16 to chairman 37 years later was a remarkable one. His appointment as chairman replaced the bank's traditional conservatism with a more entrepreneurial approach to the challenges the bank faced. One of the first challenges Taylor met was the relaxation of rules governing the ownership of brokerage firms by banks.
The Royal began negotiations with Wood Gundy, a leading Canadian brokerage firm, in the spring of , some months before the law actually changed. That deal fell through, but the Royal went on to acquire Dominion Securities later renamed RBC Dominion Securities , the largest investment house in Canada, just after the stock market crash in October that year.
Although it was one of the last of Canada's big banks to enter the brokerage market, by waiting, the Royal got the best deal of all, saving a significant amount over pre-crash prices.
Royal Bank was the second-largest bank in North America by and was seeking to defend its strong position--and further raise its profile in the United States--by acquiring a U. But the bank was unable to find a suitable prospect at the right price. Federal Reserve. As the s progressed, Royal Bank concentrated on achieving revenue growth through a focus on fee-based businesses.
Much of this was growth achieved through additional acquisitions, mainly domestic. The bank moved quickly in response to a June change in Canadian law that allowed banks to own percent of insurance companies and to offer travel insurance with the early acquisition of Voyageur Travel Insurance Ltd.
Royal Trustco was Canada's largest money manager, including the handling of a large family of mutual funds, and had a strong position in global private banking. Under Cleghorn, the bank continued to acquire fee-based businesses. In RBC Dominion Securities bolstered its investment banking operation through the acquisition of Kidder Peabody's equity derivatives team.
During and early the Royal made four additional significant acquisitions.
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