Royal Bank of Canada is selling all its banking operations in the Eastern Caribbean to a consortium of local banks in the region.
The sale encompasses the branches of Royal Bank of Canada in Antigua, Dominica, Montserrat, St. Lucia, and St Kitts and Nevis, as well as regional businesses operating under RBC Royal Bank Holdings (EC) Limited in Nevis, Grenada and St. Vincent and the Grenadines.
The consortium of five financial entities purchasing includes: 1st National Bank of St. Lucia, Antigua Commercial Bank Ltd., National Bank of Dominica Ltd., the Bank of Montserrat and Bank of Nevis Ltd.
RBC has operated in the Caribbean for more 100 years – longer than we have been in many parts of Canada"
The announcement comes weeks after rival bank CIBC announced had reached an agreement on the purchase of a portion of its shares in its Caribbean entity, FirstCaribbean International Bank Limited ("FirstCaribbean") by the GNB Financial Group Limited.
Johnathan Johannes, managing director of 1st National Bank St. Lucia, said the consortium was formed to expand the scale of the locally owned financial entities in the Eastern Caribbean Currency Union. In a press release, he said: "This transaction gives us the size and scale to play a more active role in the development of our respective countries. We see this transaction as the first step in achieving even greater synergies, efficiencies and cross-territory marketing opportunities."
Wilfred Baghaloo of PwC Jamaica, who advised the consortium, said the transaction demonstrates that "Caribbean countries and businesses have the capacity and capability to come together when the circumstances are right".
RBC will keep a presence in The Bahamas, as well as Trinidad & Tobago, Barbados, the Cayman Islands and Turks & Caicos, all of which are larger, higher income markets.
"RBC has operated in the Caribbean for more 100 years - longer than we have been in many parts of Canada. We remain committed to the future of the Caribbean and to a vision of digital innovation that transcends traditional services," Johannes added.
The transaction is subject to regulatory approval and other customary closing conditions and is expected to be finalised in the coming months.
Financial terms of the transaction were not disclosed.