Laurentian Bank of Canada failed to find a buyer amid its strategic review and will move forward with a focus on “efficiency and simplification,” the bank said Thursday.
The bank launched its strategic review, with JPMorgan Chase as its advisor, in 2022. The Globe & Mail reported that Laurentian initially focused on expanding “by buying a niche finance business in sectors such as commercial lending, or potentially merging with another financial institution;” but the review eventually led them to consider as well a partial or full sale of the bank.
Now, though, it plans to dig in on its current strategy, which Bloomberg reported includes commercial lending growth and upgrades in technology.
It will “be simplifying its organizational structure and focusing on where it can win by allocating capital and resources to its highest grossing businesses and specialized products while maintaining a relentless focus on the customer,” Thursday’s announcement said.
Mike Mueller, chair of the bank’s board of directors, said that Laurentian is a stronger firm now than it was three years ago.
“As a Board, we have completed our review and we are unanimous in our decision that embarking on an accelerated evolution of the Bank’s current strategic plan with an increased focus on efficiency and simplification will drive the most value for our shareholders and stakeholders,” Mueller said.
Laurentian missed its first deadline to find an acquirer in late July when its largest potential suitors — TD and Scotiabank — each declared they wouldn’t be bidding.
Barclays analysts at the time noted that that “likely lower[ed] the probability of a sale to less than 50%, but if not, at the very least, reduces the chances of a ‘bidding war’ for Laurentian.”
KBW analyst Mike Rizvanovic told Reuters that Thursday’s development marked “a disappointing end to Laurentian's strategic review for shareholders."
Laurentian CEO Rania Llewellyn, however, said that she and the executive team are “more confident than ever in Laurentian Bank’s strong positioning in the market and unique offering for our customers.”
Llewellyn elevated two Laurentian executives to expanded roles, putting commercial banking head Eric Provost also at the help of Laurentian’s personal banking business; and adding bank administration to the plate of current human resources chief Sébastien Bélair as he assumes the chief administrative officer role.
Personal banking chief Karine Abgrall-Teslyk and operations head Yves Denomme will depart the bank.
Laurentian plans to offer up more information on an earnings call Dec. 7, and will reveal a revamped strategic plan at an investor day early next year.
