Royal Bank of Canada today said it is to acquire the US private and commercial bank City National Corporation for around $2.7 billion in cash and approximately 44 million RBC common shares.

Royal Bank of Canada today said it is to acquire the US private and commercial bank City National Corporation for a cash and stock deal valued at $5.4 billion.

Headquartered in Los Angeles, CA, City National serves high net worth and commercial clients across a number of US metropolitan areas including New York, Los Angeles, the San Francisco Bay Area and Orange County.

City National has been ranked by Barron's as one of America's top 40 wealth managers for the last 14 years, RBC said in a statement.

“In line with RBC's strategic goals, we believe this combination creates a powerful expansion platform for focused long-term growth in the country which we view as our second home market,” said Dave McKay, president and chief executive of RBC. “City National's private banking and wealth management capabilities will enable us to offer a broader product suite to the 340,000 US households served by our US wealth management unit.”

City National also has industry specialties that will complement RBC's strong capital markets franchise, McKay said.

RBC will combine its US wealth management unit with City National, under the leadership of City National's chairman and CEO, Russell Goldsmith. John Taft will remain as CEO of wealth management in the US. The combined unit will be reported as part of the global RBC Wealth Management segment. Goldsmith has served as City National's CEO since 1995.

City National stockholders will be entitled to elect to receive the merger consideration in RBC common shares or cash, subject to certain adjustments and limitations.

Closing is expected in the fourth calendar quarter of 2015, subject to customary closing conditions including receipt of required regulatory approvals and the approval of City National's common stockholders.

The move comes after RBC said in November that it is shutting down its international client wealth management business in the Caribbean, along with some international advisory businesses in Canada and the US.