04 October 2006

RBC, Scotiabank to Add Branches

Bloomberg, Doug Alexander and Sean B. Pasternak, 4 October 2006

Royal Bank of Canada and Bank of Nova Scotia, two of Canada's biggest banks, plan to open more branches in the next few years to add deposits and expand their asset-management businesses.

Royal Bank, the country's largest bank by assets, may build as many as 112 branches in the next four years, Chief Operating Officer Barbara Stymiest said today at a CIBC World Markets investor conference in Montreal. Scotiabank, the third-biggest bank, plans to open 30 branches next year, Chief Executive Officer Richard Waugh said at the same conference.

Canadian banks are adding branches to increase deposits, investment accounts and win new customers. Canadian Imperial Bank of Commerce, the fifth-largest bank, said last month that it plans to open or expand 70 branches in the next five years.

"We are focusing now on the investment business -- our customers' investment business," Waugh said. "We know where the money is, and now we have to go after it."

Stymiest said the bank will open about 50 branches in the Toronto area by 2008 and "we suspect that by 2010 we'll be opening another 62 nationally." An expansion would reverse a trend at Royal Bank, which has reduced its number of branches in recent years, according to its latest annual report.

The bank had 1,109 locations in Canada as of July 31, down from 1,125 at the fiscal end of 2001. Royal Bank added six branches last year, and will renovate almost half its offices to better serve customers, Stymiest said.

Bank of Nova Scotia added 20 branches in Canada this year, the first expansion since 1998. The 30 scheduled to open next year will be in "high-growth demographic areas," Waugh said. The new branches will be across all Canadian regions, with a "concentration" in Alberta, British Columbia and the Toronto area, Scotiabank spokesman Frank Switzer said.