Royal Bank of Canada Focuses on Alternative Investments

By Nivedita Balu
Location: Toronto

The Royal Bank of Canada (RBC) is shifting its strategy towards alternative investments and emerging markets debt and equity to enhance its U.S. global asset management business, according to new CEO Donald Sanya, who has plans to increase hiring.

Sanya, born and raised in Nairobi, Kenya, took the reins in August and oversees a team of 225 employees in the U.S. Since 2020, the U.S. global asset management team has added around 75 employees, with further hires expected, although Sanya did not disclose specific numbers.

He emphasized potential growth in the U.S., particularly in emerging markets where RBC manages $35 billion in assets, alongside fixed income via RBC’s BlueBay platform, which oversees over $100 billion in assets.

“We really believe that this is an area that will continue to drive a lot of growth for us,” Sanya stated in an interview. He noted that emerging market economies are anticipated to grow faster than developed markets, driven by favorable demographics, increased domestic consumption, and other long-term trends, making them attractive for investors.

Sanya also identified private lending in emerging markets as a promising and fast-growing asset class, as investors look to diversify through corporate loans.

He explained that increased market volatility and rate uncertainties have created investment opportunities in fixed income, enabling the potential for superior returns for clients. Sanya observed a rising demand for wealth management platforms due to an aging population.

RBC’s asset management division manages approximately $470 billion in assets globally, with wealth management contributing about 15% to the bank’s overall earnings.