TORONTO — Royal Bank of Canada is launching a co-branded Mastercard with Shoppers Drug Mart (SDM).

The launch of the new credit card extends a relationship between Canada’s largest bank and the 1,271-store drug chain that started with the launch of a co-branded debit card and bank account in March.

The agreement between the two companies will also see RBC acquire SDM’s existing Mastercard Optimum credit card portfolio. Financial terms were not disclosed.

When the deal closes, RBC plans to roll the current Shoppers Optimum MasterCard credit cards into the RBC Shoppers Optimum MasterCard credit card program. Meanwhile, existing cardholders can continue to use their Shoppers Optimum MasterCard and receive the same benefits that they do today.

“This is a natural extension of the strategic alliance between RBC and Shoppers Drug Mart,” RBC’s group head of Canadian banking Dave McKay says. “Our joint program is designed to deliver financial flexibility while giving Canadians access to one of the top loyalty programs in the country. This is another step forward in making banking easier and the retail experience more rewarding for everyone.”

According to SDM, Canadians using the RBC Shoppers Optimum banking account and debit card have earned more Shoppers Optimum points by paying with their debit card and have gained access to Canada’s largest network of ATMs, including over 250 ATMs in Shoppers Drug Mart and Pharmaprix stores.

Under the RBC-Shoppers Drug Mart program, consumers can earn Shoppers Optimum points whether they shop at a Shoppers Drug Mart/Pharmaprix drug store or at any merchant that accepts MasterCard or Interac debit. In addition, they can collect bonus points for signing up and earn additional points on purchases when presenting the Shoppers Optimum loyalty card at Shoppers Drug Mart/Pharmaprix.

“We are continuously looking for new ways to reward our Shoppers Optimum members and are pleased to provide this enhanced financial service offering with RBC, a trusted leader in banking,” SDM president and chief executive officer Domenic Pilla says. “Our Shoppers Optimum loyalty program members are among our most passionate customers, and with the launch of this new credit card they will have more options for earning rewards.”