PNC Pledges to Add Corporate Banking and Asset Management Slots in N.C. in Wake of Job Cuts Related to RBC Takeover
Over 600 RBC Bank positions in North Carolina will be cut following the bank's takeover by Pittsburg-based PNC Financial Services Group. That's according to a notice filed with the Pennsylvania Commerce department. But that cloud has a couple of silver linings.
PNC—one of the biggest commercial real estate lenders in the country—is intending to reassign some of those positions and add an unspecified number of corporate banking and asset management positions, says Fred Solomon, spokesman for the Pittsburgh-based bank, in an interview with Bloomberg.
PNC had stated in a regulatory notice that 425 jobs in Rocky Mount and 196 in Raleigh would be eliminated once its $3.45 billion acquisition of Raleigh-based RBC is complete in March, according to WRAL.com of Raleigh, Durham and Fayettevillw, N.C. The layoffs are expected to begin in mid-March, the news station reported.
"PNC also intends to create a significant number of new jobs in North Carolina as a result of this integration," James Popp, PNC senior vice president for human resources, wrote in the commerce department notice. "The largest portion of these jobs will be filled in Rocky Mount and Raleigh,” he said, though there will also be a number of other opportunities across the state. “It is our hope to redeploy displaced RBC employees to many of these opportunities," Popp added.
RBC Bank is the U.S. retail banking arm of the Royal Bank of Canada. It employs some 2,600 people in North Carolina, including about 1,000 in Rocky Mount and 500 in Raleigh.
Jim Rohr, chairman and CEO at PNC, agreed to pay $3.62 billion in cash and stock for Raleigh-based RBC Bank USA and its related credit card assets. Rohr said at the time that he expects PNC to reduce expenses by $230 million annually, or about 30 percent of RBC Bank USA’s costs, through “operational efficiencies.”
The Federal Reserve first said last month it had approved PNC Financial Services Group Inc.'s plan to acquire Royal Bank of Canada's U.S. retail banking unit. At the time, the Wall Street Journal observed that PNC beat out rival regional bank BB&T Corp. for the RBC operations, offering a chance to expand more in the Southeast.
“The Fed's decision makes PNC, one of the nation's biggest lenders in commercial real estate, the first bank to pass a new, tougher premerger review required by the 2010 Dodd-Frank financial-overhaul law,” The Journal reported, adding that the law requires the Fed to scrutinize and potentially block bank deals that would create an institution so large that its failure would threaten the financial system.
Last summer, Canada’s Globe and Mail reported that the anticipated RBC/PNC deal ends a decade-long experiment in U.S. personal and commercial banking for RBC: The bank had spent $4.6 billion on acquisitions in the U.S., starting in 2001 when it bought North Carolina-based Centura Bank. “But the cluster of branches RBC assembled from Florida to Virginia was too scattered and located in mostly smaller markets, to generate strong deposit growth,” said the Globe and Mail, and it was also ultimately too heavily reliant on mortgage and construction lending, which were hit hard in the financial crisis.