A logo on Royal Bank Plaza is pictured on Bay Street in Toronto on July 25, 2014.Darren Calabrese/The Globe and Mail
Royal Bank of Canada is refocusing its wealth-management arm and cutting jobs as it parts ways with the division's Caribbean business and launches a strategic review of its RBC Suisse operation.
The changes will also affect some private banking groups in Canada and the United States that have an international focus.
However, the number of job cuts has not been finalized because the bank is "considering a number of strategic options for these businesses."
The changes come as Canadian banks struggle to turn around their Caribbean divisions.
Royal Bank of Canada, Canadian Imperial Bank of Commerce and Bank of Nova Scotia – the three Canadian lenders with sizable operations in the region – have all suffered writedowns from their Caribbean arms in the past year because the islands are still suffering from a drop in tourism following the global financial crisis.
In a statement, RBC acknowledged the changes will lead to some job losses.
But it also said that even when combined, the affected units "represent a small segment of our RBC Wealth Management business."
The shuffle is one of the first strategic moves made by newly appointed chief executive officer Dave McKay, who took over in August.
When he took the reins, Mr. McKay stressed that wealth management is one of the bank's key growth areas and that RBC will look to grow by adding equity funds and alternative asset products.
However, that growth will only come in key areas.
This is to ensure the bank's operations do not become too far flung.
RBC is focused on serving high-net-worth and ultrahigh-net-worth clients in Canada, the United States, Britain and Asia.
RBC has been particularly keen on expanding in the United States, where it wants to leverage its wealth management clients and possibly offer them more traditional banking services, helping to build a retail presence without physical bank branches.
Tim Kiladze