Laurentian Bank's mortgage portfolio declines amid ongoing sale transactions

Montreal —
Laurentian Bank continued to reduce its residential portfolio in the second quarter, progressing in executing sale transactions related to its exit from retail and small and medium-sized business banking services.

The residential mortgage loan portfolio reached $15.6 billion by the end of the quarter, compared to $16.1 billion at the end of fiscal year 2025, a decrease of 3%.

The bank said the decline reflects a strategic shift in its business model, moving towards focusing on specialized commercial banking services.

The bank recorded a net loss of $20.6 million, compared to profits of $32.3 million in the same period last year, due to restructuring costs and transactions related to the announced deals.

On an adjusted basis, Laurentian achieved profits of $22.6 million, down from $34 million a year ago.

The bank's plans include selling the retail and small and medium-sized business banking portfolios to National Bank, alongside a proposed acquisition deal by Fairstone Bank of Laurentian.

The bank said the Competition Bureau has completed its review of the two deals, but closing remains conditional on obtaining other regulatory approvals, including approvals from financial regulatory bodies and the federal Minister of Finance.

Laurentian expects to complete the deals by late 2026 if the required approvals and conditions are met.

Credit loss provisions also rose to $26.9 million, compared to $16.7 million a year ago, driven by increased provisions on impaired commercial loans.

The Tier 1 common equity ratio stood at 11% at the end of April, stable compared to last year, but lower than its level at the end of the fiscal year.