The Royal Bank of Canada said on Thursday that it had actually consented to get the City National Corporation, a private and also business bank based in L.a, for $5.4 billion in cash and also stock.

The Canadian bank is offering 0.7489 of a typical share and also $47.25 in money for every single share of City National, or a total amount of $93.80 a share, 26 % above City National's closing stock cost on Wednesday. It is the Royal Bank of Canada's biggest purchase to this day.

Founded in 1954, City National is known as 'Hollywood's banker,' because of its clients in the show business. A write-up in Barron's in 2013 kept in mind that Frank Sinatra was close friends with the Bank's 1st chief executive, Al Hart. When Mr. Sinatra's 19-year-old child was abducted in 1963, City National opened its safes over the saturdays and sunday to give the $240,000 in ransom cash.

In an article in The New york city Times on Dec. 13, 1963, the bank would certainly not confirm product packaging the ransom money, yet an executive informed the press reporter: 'Mr. Sinatra has actually been a customer of this bank many years and has significant credit here. If he requested such a quantity, he might obtain it.'

The bank serves wealthy and commercial clients in markets including New York, San Francisco and also Orange County, Calif.,& Los Angeles.

'City National's private banking and also wealth administration capabilities will enable us to offer a wider product collection to the 340,000 U.S. homes offered by our UNITED STATE wealth management unit,' David I. McKay, the chief executive of Royal Bank of Canada, stated in a declaration.

The Canadian bank plans to incorporate its Usa wide range administration business with City National. It will certainly be led by the president of City National, Russell Jeweler. Royal Bank of Canada has 8,000 employees in the Usa, including more than 3,000 in New york city.

Wealth management has been a driver of development at Royal Bank of Canada. Revenues from the wealth management business rose 22 %in 2012 from 2013. At a seminar last week, Mr. McKay discussed how the Canadian wealth management business had actually been concentrating on 'higher & higher net worth clients' and that the bank was using the exact same playbook in the Usa.

'We're trying to execute that in the U.S.,' he said. "There's absolutely chances there.'

The deal is expected to close in the 4th quarter of this year.

Bank of America Merrill Lynch and Sandler O'Neill served as financial advisers to City National. Wachtell, Lipton, Rosen & Katz acted as lawful consultant.

RBC Capital Markets, JPMorgan Chase & the law firms Sullivan & Cromwell and also Osler, Hoskin & Harcourt encouraged the Royal Bank of Canada.