$Royal Bank of Canada (RY.CA)$‘s CEO, Dave McKay, expressed disinterest in acquiring US banks, highlighting the challenges of inheriting issues from such deals. Speaking at Bank of Nova Scotia’s annual financial industry conference in Toronto, McKay emphasized his cautious approach towards acquisitions, questioning the benefits of taking over US banks and the potential problems involved. He stated, “The first question I always ask myself on an acquisition is, ‘Why are they selling and what problems am I inheriting, and can I run this business better than the current management team can?’

Despite his past acquisition of Los Angeles-based City National Bank for $5 billion, which later encountered profitability issues and regulatory challenges, McKay remains wary of US expansions. He prefers focusing on organic growth within the US, reaffirming his stance from RBC’s recent earnings call: “We don’t feel we need to bet the organization on a US acquisition.”

Meanwhile, other Canadian banking executives like Bank of Montreal’s CEO Darryl White and Canadian Imperial Bank of Commerce’s Victor Dodig shared their perspectives at the same conference, each emphasizing different strategies for navigating the US market amidst varying levels of optimism and caution. Scotiabank’s Scott Thomson also mentioned plans for a significant investment in KeyCorp, highlighting ongoing interest in strategic US market entries.

Overall, while some Canadian banks continue to explore US opportunities, McKay’s strategy for RBC focuses on strengthening and growing existing operations rather than pursuing risky acquisitions.