Shareholders of Laurentian Bank of Canada have overwhelmingly approved the bank’s acquisition by Fairstone Bank of Canada, , marking a significant shift in the Canadian financial landscape. The vote, held at a special meeting, secures the future of the transaction initially announced on .
Under the terms of the agreement, Fairstone Bank will acquire all issued and outstanding common shares of Laurentian Bank at a price of $40.50 per share. Simultaneously, National Bank of Canada will acquire certain assets and assume liabilities related to Laurentian Bank’s retail and small and medium-sized enterprise (SME) banking sectors. This dual-track approach aims to streamline Laurentian Bank’s operations and position both acquiring entities for growth.
The decision follows recommendations from leading proxy advisory firms, Institutional Shareholder Services (ISS) and Glass Lewis & Co., LLC, both of which urged shareholders to vote in favor of the transaction. The Board of Directors of Laurentian Bank also unanimously recommended approval, emphasizing the value proposition for shareholders.
Strategic Rationale and Transaction Details
The acquisition by Fairstone Bank represents a strategic move for both institutions. Fairstone, Canada’s leading alternative lender, will integrate Laurentian Bank’s commercial lending operations, including commercial real estate lending, Northpoint Commercial Finance, B2B Bank, and Laurentian Bank’s capital markets subsidiaries. Following completion, Laurentian Bank will operate as a wholly-owned subsidiary of Fairstone Bank, while retaining its brand identity and maintaining its head office in Montreal.
National Bank’s acquisition of Laurentian Bank’s retail and SME portfolios complements its existing activities in Quebec, strengthening its position in the province. The combined effect of these transactions is intended to create a more focused and efficient banking sector in Canada.
Shareholder and Regulatory Approvals
The completion of the transaction remains subject to shareholder and regulatory approvals, including reviews by the Competition Bureau, the Office of the Superintendent of Financial Institutions (OSFI), and the Minister of Finance. Laurentian Bank has been actively working to secure these approvals since the initial agreement was announced.
Laurentian Bank’s proxy solicitation agent, Laurel Hill Advisory Group, provided assistance to shareholders with voting their shares. Shareholders could reach out via telephone at , by text message, or by email for support.
Recent Financial Developments
The approval of the acquisition follows a series of recent financial announcements from Laurentian Bank. On , the Board of Directors declared a dividend of $0.38725 on the preferred shares Series 13, payable on . The bank announced it would release its first quarter 2026 results on , with results expected around 6:30 AM.
On , Laurentian Bank also declared a dividend on its common shares, signaling continued commitment to shareholder returns prior to the acquisition.
Implications for the Canadian Banking Sector
The acquisition of Laurentian Bank marks a notable consolidation within the Canadian banking sector. While the major banks have largely remained dominant, this transaction demonstrates a willingness to reshape portfolios and focus on core competencies. Fairstone Bank’s expansion into full-service banking through the acquisition of Laurentian Bank could introduce increased competition in certain segments, particularly in alternative lending and commercial banking.
National Bank’s acquisition of Laurentian Bank’s retail and SME assets is expected to bolster its presence in Quebec, a key market for the bank. The transaction allows National Bank to expand its customer base and enhance its service offerings in the region.
The outcome of this transaction will be closely watched by industry observers as a potential indicator of future consolidation trends within the Canadian financial services industry. The regulatory reviews by the Competition Bureau and OSFI will be crucial in determining the long-term impact on market competition and financial stability.
The successful completion of the transaction, pending final regulatory approvals, represents a significant milestone for Laurentian Bank, Fairstone Bank, and National Bank of Canada, and is poised to reshape the competitive dynamics of the Canadian banking sector.
