CA - Laurentian Bank: Remains In The Penalty Box
2024-07-02 06:58:31 ET
Summary
- Recent National Bank/CWB merger sparks speculation of further consolidation in Canadian banking.
- However, after reviewing the NA/CWB transaction and Laurentian's results, it's clear why Laurentian has failed to find a suitor, as it lacks assets that appeal to its larger competitors.
- As a standalone entity, Laurentian continues to struggle financially, inconsistent with management's medium-term goals. Until we see evidence of improvement, I suggest investors stay on the sidelines.
Recently, I saw the news that Laurentian Bank's ( LB:CA ) peer, Canadian Western Bank ( CWB:CA ), was being acquired by National Bank of Canada ( NA:CA ). Since the two banks are similar in size, C$48.4 billion in total assets for Laurentian vs. C$42.0 billion for Canadian Western, my immediate thought was whether Laurentian will be next in line to be acquired in the current consolidation wave ....
Laurentian Bank: Remains In The Penalty Box