The Royal Bank of Canada got approval from Finance Minister Chrystia Freeland to buy HSBC Canada, but the decision is not sitting well with a watchdog organization and the Official Opposition.The $13.5 billion takeover was approved by the Competition Bureau in September, but needed final approval from the finance minister. The announcement was made just before Christmas, an ideal ideal time to avoid negative commentary. However, Duff Conacher, co-founder of Democracy Watch, stepped up regardless.Conacher told Western Standard by email the decision does not serve Canadians well. “Given Canada's banking market is now even less competitive, it is even more important that Finance Minister Freeland keeps the Liberals' 2021 election promises to empower the FCAC (Financial Consumer Agency of Canada) to audit bank interest rates and fees and order them lowered whenever it finds gouging and to empower OBSI (Ombudsman for Banking Services and Investments) to make binding rulings on customer and investor complaints and also requires the banks to work with Canada Post to establish postal banking outlets across Canada to provide low-cost, small-value lines of credit to everyone, especially people with low incomes,” Conacher said by email.Conacher said the government doesn’t bring the facts to bear to know whether the decision was good or not and besides that, Democracy Watch has a list of broken Liberal election promises they knew to do but still have not fulfilled.“Finance Minister Freeland and the Canadian government did not have key information that it needed to evaluate whether the takeover was in the public interest because, unlike in the US for the past more than 30 years under the Community Reinvestment Act, our government does not require banks to disclose detailed information about their lending, investment and service records,” Conacher explained.“As a result, the government couldn't determine whether RBC has a record of discrimination in lending or service to specific communities or sectors of society and should not have been allowed to take over HSBC until it corrected its record.”The minister's approval comes with conditions, including none of HSBC Canada's 4,000 employees be fired within six months of the closing date and that front-line staff keep their jobs for at least two years. Also, banking services must be provided at a minimum of 33 HSBC branches for four years.Even so, Canada's six biggest banks control 93% of banking assets and this deal will make this 95%. Conacher said the US, which has many more banks, has done a better job of looking at proposed takeovers by Canadian banks of smaller banks south of the border.“Finance Minister Freeland’s evaluation process of RBC’s takeover of HSBC was a sad joke compared to the process US financial agencies used to evaluate whether TD Bank’s proposed takeover of a US bank was in the public interest, or compared to the US process used to evaluate any of the takeovers that RBC, CIBC and BMO have done in the past few decades in the US,” said Conacher.Conservative Leader Pierre Poilievre opposed the deal. He pointed to the Competition Bureau's finding the bank was a rate disrupter on mortgages, and without an independent HSBC, Canadians may be left with no decision but to pay higher rates.“The Trudeau Liberals should have supported competition in banking & mortgage lending by blocking the merger. Now all Canadians will pay the price,” tweeted Poilievre.Freeland responded to Poilievre in a tweet saying HSBC was ready to pull up its stakes from Canada, so her approval at least saved something.“By blocking this, Pierre Poilievre would have risked 4,000 workers losing their jobs, investors losing faith in Canada as a place to do business and 780,000 Canadians losing banking services. That's not a serious position, t's reckless & irresponsible.”Freeland will require RBC to finance more affordable housing, which Conacher welcomes. However, he would like to see the banks go for a different kind of green than cash."Given RBC has the worst record of any Canadian bank of lending and investing in fossil fuel companies that are causing the climate crisis, Finance Minister Freeland should have added the condition RBC clean up its investments instead of rolling over like a lapdog and let a bad bank get bigger and do even more damage to the environment than it has already done,” Conacher said.
The Royal Bank of Canada got approval from Finance Minister Chrystia Freeland to buy HSBC Canada, but the decision is not sitting well with a watchdog organization and the Official Opposition.The $13.5 billion takeover was approved by the Competition Bureau in September, but needed final approval from the finance minister. The announcement was made just before Christmas, an ideal ideal time to avoid negative commentary. However, Duff Conacher, co-founder of Democracy Watch, stepped up regardless.Conacher told Western Standard by email the decision does not serve Canadians well. “Given Canada's banking market is now even less competitive, it is even more important that Finance Minister Freeland keeps the Liberals' 2021 election promises to empower the FCAC (Financial Consumer Agency of Canada) to audit bank interest rates and fees and order them lowered whenever it finds gouging and to empower OBSI (Ombudsman for Banking Services and Investments) to make binding rulings on customer and investor complaints and also requires the banks to work with Canada Post to establish postal banking outlets across Canada to provide low-cost, small-value lines of credit to everyone, especially people with low incomes,” Conacher said by email.Conacher said the government doesn’t bring the facts to bear to know whether the decision was good or not and besides that, Democracy Watch has a list of broken Liberal election promises they knew to do but still have not fulfilled.“Finance Minister Freeland and the Canadian government did not have key information that it needed to evaluate whether the takeover was in the public interest because, unlike in the US for the past more than 30 years under the Community Reinvestment Act, our government does not require banks to disclose detailed information about their lending, investment and service records,” Conacher explained.“As a result, the government couldn't determine whether RBC has a record of discrimination in lending or service to specific communities or sectors of society and should not have been allowed to take over HSBC until it corrected its record.”The minister's approval comes with conditions, including none of HSBC Canada's 4,000 employees be fired within six months of the closing date and that front-line staff keep their jobs for at least two years. Also, banking services must be provided at a minimum of 33 HSBC branches for four years.Even so, Canada's six biggest banks control 93% of banking assets and this deal will make this 95%. Conacher said the US, which has many more banks, has done a better job of looking at proposed takeovers by Canadian banks of smaller banks south of the border.“Finance Minister Freeland’s evaluation process of RBC’s takeover of HSBC was a sad joke compared to the process US financial agencies used to evaluate whether TD Bank’s proposed takeover of a US bank was in the public interest, or compared to the US process used to evaluate any of the takeovers that RBC, CIBC and BMO have done in the past few decades in the US,” said Conacher.Conservative Leader Pierre Poilievre opposed the deal. He pointed to the Competition Bureau's finding the bank was a rate disrupter on mortgages, and without an independent HSBC, Canadians may be left with no decision but to pay higher rates.“The Trudeau Liberals should have supported competition in banking & mortgage lending by blocking the merger. Now all Canadians will pay the price,” tweeted Poilievre.Freeland responded to Poilievre in a tweet saying HSBC was ready to pull up its stakes from Canada, so her approval at least saved something.“By blocking this, Pierre Poilievre would have risked 4,000 workers losing their jobs, investors losing faith in Canada as a place to do business and 780,000 Canadians losing banking services. That's not a serious position, t's reckless & irresponsible.”Freeland will require RBC to finance more affordable housing, which Conacher welcomes. However, he would like to see the banks go for a different kind of green than cash."Given RBC has the worst record of any Canadian bank of lending and investing in fossil fuel companies that are causing the climate crisis, Finance Minister Freeland should have added the condition RBC clean up its investments instead of rolling over like a lapdog and let a bad bank get bigger and do even more damage to the environment than it has already done,” Conacher said.
