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RBC completes acquisition of Ally's Canadian
automotive finance business
TORONTO, February 1, 2013 - Royal Bank of Canada (RY
on TSX and NYSE) today announced it has completed the acquisition
of the Canadian automotive finance and deposit business of
Ally Financial Inc. ("Ally Canada") for a $1.4 billion
investment net of excess capital. Including the excess capital
and after certain closing adjustments, the total consideration
paid was $3.7 billion. The acquisition positions RBC as a
leader in the Canadian automotive financing business.
"Ally Canada significantly expands the scope and capability
of our existing consumer and commercial auto financing business
and we're encouraged by the positive response from dealers
who want to continue building their business with RBC,"
said Dave McKay, Group Head, Personal & Commercial Banking,
RBC. "We've gained a quality and stable business with
strong industry relationships that creates a leading auto
financing business in Canada."
The Ally Canada team joins the existing RBC team to form
RBC Automotive Finance, a part of the Personal and Commercial
Banking segment of RBC. It provides financial services, including
floor plan financing, directly to auto dealers and also offers
financing for consumers through dealerships.
Building on its commitment to the automotive business, RBC
is now a partner with General Motors of Canada to provide
subvented loans to its customers, adding to the bank's existing
agreements with other leading auto manufacturers. Subvented
loans are low rate consumer auto loans subsidized by the manufacturer.
About RBC
Royal Bank of Canada (RY on TSX and NYSE) and its subsidiaries
operate under the master brand name RBC. We are Canada's largest
bank as measured by assets and market capitalization, and
among the largest banks in the world, based on market capitalization.
We are one of North America's leading diversified financial
services companies, and provide personal and commercial banking,
wealth management services, insurance, investor services and
wholesale banking on a global basis. We employ approximately
80,000 full- and part-time employees who serve more than 15
million personal, business, public sector and institutional
clients through offices in Canada, the U.S. and 49 other countries.
For more information, please visitrbc.com.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release may be
deemed to be forward-looking statements under certain securities
laws, including the "safe harbor" provisions of
the United States Private Securities Litigation Reform Act
of 1995 and any applicable Canadian securities legislation.
These forward-looking statements include, but are not limited
to, statements about the expected impact of the acquisition
of the Canadian automotive finance and deposit business of
Ally Financial Inc. by Royal Bank of Canada and other statements
other than in relation to historical facts. Forward-looking
statements are typically identified by words such as "believe",
"expect", "foresee", "forecast",
"anticipate", "intend", "estimate",
"goal", "plan" and "project"
and similar expressions of future or conditional verbs such
as "will", "may", "should",
"could", or "would".
By their very nature, forward-looking statements require
us to make assumptions and are subject to inherent risks and
uncertainties, which give rise to the possibility that our
predictions, forecasts, projections, expectations or conclusions
and other forward-looking information, including statements
about the acquisition of the Canadian automotive finance and
deposit business of Ally Financial Inc. by Royal Bank of Canada
will not be achieved. We caution readers not to place undue
reliance on these statements as a number of risk factors could
cause our actual results to differ materially from the expectations
expressed in such forward-looking statements. These factors
include, but are not limited to the impact of changes in the
laws and regulations regulating financial services and enforcement
thereof; general business, economic and market conditions
in Canada, the United States and certain other countries in
which Canada and Ally Financial Inc. operate; the effects
of competition in the markets in which Royal Bank of Canada
and Ally Financial Inc. operate; judicial or regulatory judgments
and legal proceedings; Royal Bank of Canada's ability to complete
the integration of the Canadian automotive finance and deposit
business of Ally Financial Inc. successfully; and other factors
that may affect future results of Royal Bank of Canada and
the Canadian automotive finance and deposit business of Ally
Financial Inc. including timely development and introduction
of new products and services, Royal Bank of Canada's ability
to cross-sell more products to customers and technological
changes.
We caution that the foregoing list of
important factors is not exhaustive. Additional information
about these and other factors can be found in our 2012 Annual
Report to Shareholders. Our material general economic assumptions
underlying the forward-looking statements in this press release
are set out in our 2012 Annual Report under the heading "Overview
and Outlook" and for each business segment under the
heading "Outlook and priorities". Except as required
by law, Royal Bank of Canada assumes no obligation to update
the forward-looking statements contained in this press release.
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Media Contacts:
Kerry Gaetano,
Head, Corporate Communications, Personal & Commercial
Banking and Insurance, 905 816-5583 or
647 281-2931
Matt Gierasimczuk,
Senior Communications Manager,
Corporate Communications, 416 974-2124
Analyst Contacts:
Robert Colangelo,
Associate Director, Investor Relations,
416-955-2049
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