Meridian buys Scotiabank’s Roynat Lease Finance
Surprise purchase marks a big step into commercial lease financing
Meridian, Ontario’s largest credit union, has emerged as the surprise buyer of Bank of Nova Scotia’s Roynat Lease Finance business, a unit with a portfolio of leases valued at about $910 million.
The acquired unit serves small to medium-sized businesses by helping them sell and lease equipment. It has 106 full-time employees and offices in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, and Quebec.
“This is a strategic acquisition that will allow us to diversify our service offering and revenue streams while expanding Meridian’s brand beyond Ontario,” Meridian chief executive Bill Maurin said Tuesday.
“Roynat Lease Finance is highly complementary to the strength Meridian has built in our small and commercial lines of business.”
Financial terms of the deal were not disclosed, but in a statement, Scotia said the transaction was not material. Canada’s third-largest bank also said the leasing business was not core to its Roynat subsidiary, which focuses on lending to midmarket growth-oriented companies.
“Roynat is an important component of our commercial banking platform,” said Gillian Riley, Scotia’s executive vice-president of commercial banking. “We remain steadfast in our commitment to build the Roynat brand in Canada.”
Media reports in January suggested Scotia was looking for a buyer for the leasing portion of its Roynat unit, which the bank had owned for about two decades.
Meridian’s purchase emerged as something of a surprise, given that it represents a major step by the credit union into commercial lease financing.