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The head of Royal Bank of Canada’s U.S. capital markets business allegedly violated company policies on workplace relationships, leading to his dismissal earlier this week.

Blair Fleming’s departure was announced in a short memo to staff on Monday afternoon, although at the time, no reason was given.

His abrupt departure after more than 30 years at the bank prompted speculation within the financial services industry. And by Friday, Douglas McGregor, the bank’s group head of capital markets, had dispatched an internal memo that did not specifically name Mr. Fleming, but encouraged employees to “speak up” when they see improper behaviour.

“Blair Fleming did not comply with our disclosure and conflict of interest policies relating to workplace relationships,” said Gillian McArdle, a spokeswoman for the bank, in an e-mailed statement. “When the matter was brought forward, we investigated and acted promptly.”

The bank declined to comment further, and Mr. Fleming did not respond to requests for comment. The reason for Mr. Fleming’s firing was first reported by Bloomberg LP on Friday.

RBC’s decision to part ways with Mr. Fleming comes as an array of powerful executives and their companies have faced intense scrutiny over allegations of improper behaviour toward colleagues or other people over whom they held influence.

Mr. Fleming started at RBC in London, Ont., in 1986, and after joining the bank’s capital markets arm, under RBC Dominion Securities Inc., he helped build out its syndicated loan business. In 2009, he took over as the head of RBC’s U.S. investment banking division, and helped spearhead an ambitious expansion of the bank’s footprint in New York, where Mr. Fleming lives with his wife and four daughters. In 2014, he was promoted to lead the bank’s entire U.S. capital markets business.

Under Mr. Fleming’s watch, RBC expanded its U.S. loan portfolios and poached talent in the aftermath of the 2008 financial crisis. More recently, the bank had boasted of entering the ranks of the top 10 U.S. investment banks, by some measures, and had ambitions to increase its market share to 4.5 per cent in the coming years.

In RBC’s second fiscal quarter, nearly half of the bank’s $2-billion in capital-markets revenue came from its U.S. division, according to financial disclosures.

The sudden loss of such a senior investment banker put succession plans in motion at RBC, as Jim Wolfe and Matthew Stopnik were promoted to be co-heads of the U.S. capital-markets business. They now report to Derek Neldner, a rising star within the bank who was also promoted this week, taking on global responsibility for investment banking.

“I recognize that our leadership updates earlier this week have generated questions,” Mr. McGregor acknowledged in his memo to staff, which was obtained by The Globe and Mail.

“We want to be clear that inappropriate behaviour at RBC is unacceptable and in breach of our Code of Conduct and Respectful Workplace Policies,” Mr. McGregor added. “When matters are brought forward, they are investigated and we act promptly.”

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 28/03/24 4:15pm EDT.

SymbolName% changeLast
RY-T
Royal Bank of Canada
+0.29%136.62
RY-N
Royal Bank of Canada
+0.48%100.88

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