RBC Wealth Management

Overview: RBC Wealth Management is a full-service securities firm headquartered in Minneapolis that is among the largest in the U.S. A fully-owned subsidiary of Royal Bank of Canada (RBC), RBC Wealth Management formerly was known as RBC Dain Rauscher. The oldest predecessor firm of Dain Rauscher, Kalman & Co., was founded in 1909 in St. Paul, MN. Acquisitions over the years include Bosworth, Refsnes, and Tucker Anthony, among others.

RBC Wealth Management has these lines of business:

  • Individual Wealth Management
  • Small Business Financial Services
  • Securities Trading
  • Securities Research
  • Investment Banking

Job Openings: See this list of current job openings.

Size: RBC Wealth Management reports these figures as of May 31, 2008:

  • Employees = 5,000
  • Financial Consultants (Advisors) = 1,650
  • Branches = 150
  • Offices in 40 States
  • Assets Under Management = $142.1 billion
  • Accounts = 668,700
  • Households = 302,600

RBC Bank: RBC Bank is a sister institution to RBC Wealth Management. Based in Raleigh, North Carolina, RBC Bank is the result of a series of acquisitions made by Royal Bank of Canada in six southeastern U.S. states since 2001. As of the first quarter of 2011, RBC Bank operates 430 retail bank branches and has $27 billion in assets. By assets, RBC Bank would place 23rd out of over 7,600 banks in the U.S., were it independent.

Mainly because of large loan losses, RBC Bank was put up for sale. Nonperforming loans, on which payments are delinquent, represent 6.8% of assets, versus 2.56% at regional competitor BB&T;, which is rumored to be the leading candidate for acquiring RBC Bank. While its Canadian parent is noted for strong risk management, RBC Bank reputedly has been allowed to operate largely independently, with minimal corporate oversight. In 2009, the parent Royal Bank of Canada took a $1 billion writedown on RBC Bank’s operations. It subsequently has embarked on cost-cutting drives, including branch closures. See “Buyer Beware: RBC Bank on Block,” The Wall Street Journal, 5/11/2001.

PNC has agreed to pay $3.45 billion, reflecting a discount of $112 million, to acquire RBC Bank. The deal is expected to close in the first quarter of 2012, and will extend PNC’s footprint into the southeast.

Positives: The predecessor firms of RBC Wealth Management have long histories of lean organizations lacking in bureaucracy, in which financial advisors operate with a large degree of autonomy. The current 2:1 ratio of support staff to financial advisors is indeed very lean by industry standards.

The parent company, Royal Bank of Canada, is Canada’s largest bank, with 66,000 employees and 14 million customers in 30 countries.

Negatives: The poorly-maintained corporate website, with numerous empty and broken links, indicates a certain lack of quality-consciousness and attention to detail in support functions. Whether the fault lies with RBC Wealth Management or with the corporate parent, Royal Bank of Canada, is unclear.

Working as a financial advisor for a firm that lacks the name recognition of its chief rivals introduces an added sales burden. Likewise, the troubles of its sister institution in the U.S., RBC Bank (see above), are damaging to the reputation of RBC Wealth Management.

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