December 21, 2023 – On Thursday evening the Deputy Prime Minister announced the approval of RBC’s takeover of HSBC Canada, allowing an aggressive and consistent competitor in the personal mortgage space to be acquired by the country’s largest financial institution. In exchange for the approval, the government imposed a number of conditions on the deal, including commitments to finance the development of affordable housing with a focus on British Columbia.
“Unfortunately, the government has missed an opportunity to protect competition and affordability in the banking sector,” said Keldon Bester, Executive Director of the Canadian Anti-Monopoly Project. “While commitments related to the financing of affordable housing appear positive, there is little in the way of protecting Canadian homeowners in a higher interest rate environment. In approving the transaction, the government could have secured commitments to protect HSBC mortgage customers from price increases on renewal but appears to have settled on ensuring that HSBC customers are well informed of their limited options going forward. The announcement of a consultation on strengthening competition in the financial sector is welcome but it is unfortunate that the motivating event is a reduction in that very competition.”