Canadian Banks Look to Buy Wealth Managers

Tom Burroughes

27 March 2008

Canadian banks are on a shopping expedition, looking to buy wealth management and other businesses to exploit discounted prices from the credit crunch and also tap growing demand for services from high net worth individuals, Reuters reports. Bank of Nova Scotia and Royal Bank of Canada are on the lookout for acquisitions. The head of Bank of Nova Scotia’s Canadian retail division said it wouldn't balk at paying a steep price for the right business. Chris Hodgson, executive vice president and head of domestic personal banking at Bank of Nova Scotia, said: "We will do a dilutive deal if it does expand our wealth business and long term fits strategically and gives us the financial modelling and expectations." "There have been opportunities. We have looked at some opportunities. We have stepped back because it didn't fit out modelling," Mr Hodgson said. Royal Bank of Canada, meanwhile, said it is looking to acquire talent as the credit crunch takes its toll on investment banks, but it will not make a big deal in that area. "Yes, we are interested in being an opportunistic buyer, but not in the capital markets side of the business," RBC president and chief executive, Gordon Nixon, told a financial conference. RBC, Canada's largest bank, prefers to keep corporate and investment banking at around 25 per cent of its overall business, but it is looking at adding investment banking teams or certain parts of wholesale banks, Mr Nixon said.