The leader of the Conservative Party (PCC), Pierre Poilievre, is calling on the Trudeau government to block the proposed merger between the Royal Bank of Canada and HSBC Bank which was approved last month by the Competition Bureau.
The leader of the official opposition explains that the Conservatives want competition between Canada’s financial institutions to reduce borrowing costs for households.
In a statement released Friday, Mr. Poilievre wrote: “We have an overly concentrated, government-protected banking sector that already gives too much power to too few players. We need Canadian banks to compete for customers, not buy them.”
“If Canada’s biggest banks simply buy growing players, there is no hope of ever seeing more competition in the Canadian banking sector. »
Mr. Poilievre maintains that HSBC Bank offered advantageous rates compared to Royal Bank. In his opinion, the Minister of Finance, Chrystia Freeland, has the power to prevent this merger which, he writes, “allows Canada’s largest bank to take over 800,000 customers without having to offer them anything either in exchange for their customers. »
In explaining its endorsement of the proposed merger, the Competition Bureau said its review found the deal was unlikely to significantly reduce competition, even if it resulted in Canada’s largest bank would take over the seventh largest in terms of assets.
The Bureau noted, however, that the deal, which still requires approval from the finance minister and the banking regulator, would result in the loss of a competitor in a concentrated market. The organization added that a lack of rivalry between Royale and HSBC Canada would be more pronounced for certain groups of customers, such as mortgage buyers.
The Royal Bank first announced its plan to buy HSBC Canada last November for $13.5 billion. HSBC Canada said it expects the transaction to close in the first quarter of 2024.