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The Hollywood sign in Los Angeles, Calif.ERIC THAYER/Reuters

With its $5.4-billion acquisition of Los Angeles-based City National Corp., Royal Bank of Canada has tied itself to the "Bank of the Stars."

City National earned this moniker and reputation over its 61 years building relationships in the entertainment industry, having formed its first small office on South Beverly Drive in Beverly Hills. One of the company's founders was a friend of Frank Sinatra's  – even putting up the ransom money to help recover his son in the 1960s – and City National has provided financing for films such as Silence of the Lambs and Driving Miss Daisy.

The 61-year-old company has 77 offices in 16 centres in the U.S., but its main markets are Los Angeles and New York City. City National says it's the 25th largest American commercial bank with about $60-billion of assets under administration in its wealth management business, which was a draw for RBC.

City National has said its focus is in between the large banks and community banks, providing services with more personal service to clients and customers. With a focus on high-net-worth clients, City National says it has styled its branches to feel more like private banking centres than typical retail branches.

The bank's leadership has been in the hands of two men from the Goldsmith family since 1975 when real estate mogul Bram Goldsmith became chairman and chief executive officer of the bank. At the time, City National had just $600-million in assets. He now serves as chairman emeritus and a director, having handed the reins to son Russell Goldsmith, who had been running a global independent entertainment production and distribution company, in 1995.

Under Russell Goldsmith's leadership, the bank became acquisitive, buying up 21 other banks since he took over as CEO and amassing almost $33-billion in assets. He will stay on in his role leading City National after the RBC deal is complete and will also be responsible for RBC's U.S. wealth management unit, the bank said in a statement.

Over all those years, the Goldsmith family built up a large stake in the bank, holding about 13 per cent of the company's stock. As part of the deal with RBC, the Goldsmith family will receive RBC shares. They have agreed to hold at least half the shares for three years.

City National has been building out its technology and health care focuses of late, but entertainment is still a major focus, making up about one-quarter of the banks business, said Russell Goldsmith at a recent banking conference. Some of that is tied to wealthy stars, and some is from film financing, Broadway businesses and talent agencies. "Entrepreneurs really are the heart of our business – affluent clients – we're not really a bank for Fortune 1000 Companies, we're not really a retail bank," he said. "We serve entrepreneurs, professionals, investors, their businesses, and their families."

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Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 28/03/24 1:23pm EDT.

SymbolName% changeLast
RY-N
Royal Bank of Canada
+0.52%100.92
RY-T
Royal Bank of Canada
+0.31%136.65

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