The Federal Reserve Bank of New York designated RBC Capital Markets a primary dealer this week, the second addition to the list of primary dealers so far this year.
Primary dealers are the banks eligible to trade Treasury bonds with the Fed.
In conducting its open-market operations to regulate interest rates and the money supply, the Fed uses primary dealers as intermediaries with the financial markets.
RBC is the second addition this year. Jefferies & Co. became a primary dealer last month.
RBC and Jefferies replace Dresdner Kleinwort Securities LLC and Merrill Lynch & Co., which sold itself to Bank of America.
"This is a logical extension of our global rates franchise, where we are already making markets as the equivalent of a primary dealer in both the U.K. and Canada," said Mark Standish, president and co-chief executive officer of RBC Capital Markets, in a statement.
Primary dealers also bid in Treasury auctions and trade in U.S. government securities.
"RBC has been aggressively growing its fixed-income franchise in the United States, so becoming a primary dealer is a natural next step for us," Jonathan Hunter, RBC's co-head of fixed income and currencies, said in a statement.
