(Reuters) - Royal Bank of Canada (RY.TO) is hiring aggressively as the world’s sixth-largest wealth manager seeks to expand its business in Asia and Latin America as well as more established markets such as the United States and Britain, executives said on Thursday.
RBC Wealth Management head George Lewis told Reuters in an interview that Canada’s largest bank wants to more than double its adviser headcount in emerging markets to at least 220 by 2015 as it seeks to expand its business there from C$20 billion ($20 billion) to C$50 billion.
It also plans to more than double the number of client relationship managers in Britain to 100 from 40, while continuing to add 25 to 50 advisers a year to the 1,500 in Canada.
While staffing growth in the United States is also expected, Lewis has set no target, saying recent years of heavy U.S. hiring in the wake of the financial crisis have meant the 2,100 advisers in 42 states still lag their Canadian counterparts in terms of productivity. In Canada, advisers average C$1 million in annual revenue, compared with about C$600,000 to C$700,000 for U.S. advisers, Lewis said.
Global competitors - particularly U.S. and European banks - have been on the back foot since the 2008-09 global financial crisis, while Canadian banks emerged mostly unscathed from the crisis. RBC, as Canada’s largest retail bank and the one most focused on wealth management, has been able to take advantage of that by hiring away top talent around the world.
“The combination we bring is the best of both worlds - a dedicated approach to global wealth management while others are taking the exact opposite direction, consolidating the wealth business back into structures that are commercial or retail banking,” Lewis said.
But competition for talent has begun to bounce back as rivals regain momentum.
“Some of our larger competitors post 2009 have put a renewed emphasis on growing their sales force, and that has resulted in a very competitive market for talent, particularly from a compensation point of view,” he acknowledged.
Toronto-based RBC has set its sights on global wealth management as a key driver for growth, targeting organic growth in the United States, Britain, Asia, the Middle East and Latin America as well as small or medium-sized acquisitions to build its global wealth, private banking and trust business.
Barend Janssens, head of the bank’s wealth management in emerging markets, said Asia is the obvious target for growth because its wealthier class remains relatively unbanked and interested in both asset management help and investment opportunities.
But competition is stiff when it comes to takeover targets.
“The number of acquisition opportunities are few and far between and there are a lot of buyers for the small number of assets available,” Janssens said.
RBC has the flexibility to be disciplined as it shops around, and will only do deals “on our terms,” said Singapore-based Janssens, who has overseen the bank’s growth in Hong Kong, Singapore, Geneva, Dubai, Uruguay and Brazil, among other centers.
Organic growth may be the better way to go, either by increasing the value of existing books of business, adding individual advisers, or lifting out entire teams from competitors, where possible.
Janssens said the Canadian brand goes a long way in selling the bank to clients whose current bankers are shrinking or struggling from one debt or regulatory crisis to another.
“Canada is perceived as a wonderful, strong and very focused country, which is really helping us to market ourselves,” he said. “If Canada doesn’t come up, we make sure it comes up. We bring it up.”
Reporting By Andrea Hopkins; Editing by Peter Galloway