Toronto-based Royal Bank, Canada's largest, said the transaction will create one of the most expansive banking networks in the Caribbean, with a presence in 18 countries and territories across the region.
Under the agreement, RBTT shareholders will receive a combination of 60 percent cash and 40 percent in Royal Bank shares.
The RBTT board of directors has approved the deal and is unanimously recommending that RBTT shareholders vote in favor of the transaction.
With more than US$13.7 billion (EUR9.67 billion) in assets, the combined operations will have 130 branches across the Caribbean, with more than 6,900 employees serving more than 1.6 million clients. Royal Bank's expanded Caribbean retail banking operations will ultimately be headquartered in Trinidad and Tobago.
Reports surfaced over the weekend that a deal for RBTT Financial Holdings Ltd. was nearing completion.