Briefly:

Royal Bank of Canada has expanded its international footprint, announcing the purchase of Mourant Private Wealth, based on the island of Jersey in the English Channel.

Mourant has 47 employees, with operations in Dubai and the Cayman Islands. The deal is expected to close in early 2009, pending regulatory approval.

RBC already has a substantial presence in the British Isles, employing about 1,500 people with £63 billion in assets under administration. Mourant will add an additional £3.5 billion.

“This transaction advances our long-term strategy to build further on our core business of integrated private wealth management services to international clients by hiring experienced professionals with strong client relationships,” said Paul Patterson, head of RBC Wealth Management, British Isles.

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Banks struggle to consolidate risk

You would think that the recent implosion of the credit markets would have caused the world’s banks to reassess the concept of risk, but only 14% of top banking execs says they have a consolidated view of risk, according to a report by Ernst & Young.

“One of this year’s biggest lessons is that unidentified risk can lead to catastrophic results,” says Paul Battista, Ernst & Young partner in Toronto. “We now need to be prepared for the unexpected. But these organizations are facing real obstacles as they work to achieve that.”

Some lessons have been learned. In the past, “risk management” was viewed as a narrow focus within a firm. It is now seen as vital to survival.

“The current crisis has reminded banks of the need to build and effectively maintain strategic risk management programs now if they want to succeed in 2009 and beyond,” Battista says. “Risk management must become top-of-mind for everyone within an organization if we’re going to create a stronger culture of risk awareness in banks.”

The survey of 40 global banks found that 86% of top execs said their firm is working on a more comprehensive approach to risk, but only 16% had a well-defined vision of what that means.

Sixty-seven per cent said they are working on consolidating their risk reporting, but only 9% said they felt confident they had been able to aggregate data across the company.

(12/19/08)

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.