A top U.S. bank regulator on Wednesday imposed a $65 million fine on the Royal Bank of Canada’s American unit, City National Bank, over gaps in the lender’s risk management and internal controls.
The Office of the Comptroller of the Currency (OCC) said that the bank engaged in unsafe or unsound practices, including failure to establish effective risk management and internal controls.
The OCC issued a cease-and-desist order requiring the bank to take broad and comprehensive corrective actions to improve its strategic plan, the agency said in a statement.
City National Bank said in a statement to Reuters early Thursday that it is committed to resolving the matters identified in the OCC’s order as quickly as possible.
“Our focus will continue to be on both strengthening our infrastructure and systems to reflect a bank of our size and business model,” it said.
In October, City National disclosed that RBC has injected about $2.95 billion into its U.S. unit to bolster its capital. The capital injections came as a part of management actions to improve profitability at City National.
RBC has previously said realized losses at City National would be eliminated at the RBC consolidated level.
(Reporting by Gursimran Kaur in Bengaluru; Additional reporting by Nilutpal Timsina; Editing by Rashmi Aich)
