Tech, personal and commercial banking teams hit by layoffs, sources say
Royal Bank of Canada (RBC), the country’s largest lender, has laid off employees as part of a restructuring effort following its $13.5 billion acquisition of HSBC Canada, according to two sources with direct knowledge of the matter.
The job cuts, which began earlier this week, affected teams in technology and operations, personal banking, and commercial banking, the sources said. The exact number of affected employees remains unclear, and it is unknown if additional layoffs are planned.
RBC split its personal and commercial banking divisions into separate segments last summer as part of a broader organizational shakeup after finalizing the HSBC Canada acquisition. This restructuring also brought changes to senior leadership within the bank.
An RBC spokesperson confirmed the layoffs, stating that the reorganization led to “some difficult decisions” that resulted in job cuts.
“The changes we’ve made better position RBC to take advantage of our global scale, simplify how we work, and elevate the leaders and talent who will shape our client-focused growth opportunities,” the spokesperson told Reuters. RBC said it is providing support and assistance to those impacted.
RBC had 94,624 full-time employees as of January 31, a 5% increase from the previous year, largely due to the HSBC acquisition.
Some of the layoffs occurred at RBCx, the bank’s tech and innovation banking division, which operates under the technology and operations team, according to one source.
In a memo seen by Reuters, RBC’s commercial banking head, Sean Amato-Gauci, acknowledged that some employees had left the bank following the restructuring. Erica Nielson, head of personal banking, stated in a separate memo that several employees have been reassigned to new roles or joined from outside the business segment as part of the transition.
Meanwhile, RBC chief executive officer Dave McKay received a 60% pay increase, bringing his total compensation for 2024 to $24.5 million. The package included a $4 million bonus tied to the HSBC acquisition, which is the largest deal in RBC’s history, according to a regulatory filing on Thursday.
Read next: RBC, CIBC reveal latest financial results
The job cuts at RBC come as Canada’s hiring slowed in February, with economic uncertainty and trade tensions weighing on business confidence.
According to Statistics Canada, the economy added just 1,100 jobs in February, well below economists’ expectations of 20,000 new jobs. The unemployment rate remained at 6.6%.
The slowdown has raised expectations of an interest rate cut, with market odds for a Bank of Canada rate reduction next week increasing to 85%, up from 75% before the jobs data was released.
While employment rose in retail, wholesale trade, finance, real estate, and insurance, job losses were recorded in scientific and technical services, transportation, and warehousing sectors.
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