Laurentian Bank plans strategic shifts including $156M charge, focuses on enhancing medium-term profitability

From Investing.com: 2024-06-02 20:14:28

Laurentian Bank made significant financial adjustments, including a $156 million charge in goodwill and intangible assets to streamline operations. After-tax charges of $161 million were incurred due to the suspension of the AIRB project, with estimated annual savings of approximately $20 million. Despite impacting regulatory capital slightly, the bank aims to enhance medium-term profitability through these strategic shifts. Investor Day will provide further details on these initiatives.

During Laurentian Bank’s Q2 2024 earnings call, Eric Provost, President and CEO, highlighted the bank’s new strategic plan focusing on commercial banking as a growth engine, reducing complexity in personal banking, and utilizing capital markets to support customers across the bank. Liam Mason, Executive Vice President and Chief Risk Officer, announced his forthcoming retirement, acknowledging his significant contributions to the bank’s risk-aware culture. The bank’s adjusted results for the quarter aligned with expectations, with disciplined loan volume management and cautious dealer inventory approach in a challenging macroeconomic environment. Expansion of technology and digital capabilities contributed to elevated expenses and an adjusted efficiency ratio of 73.8%. Maintaining a stable net interest margin at 1.8% and a CET1 capital ratio of 10.4%, the bank remains focused on prudent credit practices and simplification efforts. The suspension of the AIRB project aims to prioritize strategic initiatives and further enhance profitability in the medium term, aligning with the bank’s overarching goals.



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