(Bloomberg) -- Royal Bank of Canada is interested in adding to its US business through wealth-management and commercial-banking acquisitions, but deals south of the border are hard to come by, Chief Executive Officer Dave McKay said.

Speaking Tuesday at a conference in Toronto hosted by RBC Capital Markets, McKay said that while US mergers aren’t an immediate priority, the region will continue to be a focus for Canada’s largest lender.

McKay was asked how Royal Bank plans to deploy excess capital over the next few years after it completes its landmark C$13.5 billion ($10.1 billion) deal to acquire HSBC Holdings Plc’s Canadian operations. That deal won government approval in December, and Royal Bank plans to complete the takeover in the first quarter.

McKay reiterated that his company expects C$740 million in annual pretax cost savings from the deal. Royal Bank will provide more details on expected revenue synergies in the months ahead, he said.

After reinvesting in existing businesses to drive organic growth, “the focus will continue to be in the United States tactically,” McKay said, adding that continuing to build scale with UK assets would be a “secondary objective.” The bank acquired UK wealth-management business Brewin Dolphin Holdings Plc for C$2.4 billion in 2022.  

“Primary would be in the US wealth or commercial space,” McKay said. “But the opportunities are few and far between and the market is too uncertain right now to do that and therefore isn’t in our short-term objectives in any way.”

In the near term, Royal Bank plans to remove its dividend-reinvestment plan this year and return capital to investors, he said. While several Canadian banks have used such programs as an inexpensive way to build capital in recent years, they’re also dilutive for existing shareholders.

(Updates with comment on cost savings in fourth paragraph.)

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