BMO to Sell Moneris Stake to Francisco Partners for ~$1B, Expecting $600M After-Tax Gain

summarizeSummary

BMO announced the sale of its 50% stake in Moneris Solutions to Francisco Partners for ~$1.0 billion in cash, expecting a $600 million after-tax gain and a 15 bps CET1 ratio improvement. The transaction includes new long-term referral arrangements and is expected to close by Q1 fiscal 2027.

check_boxKey Events · M&A and Partnerships · BMO

• Moneris Stake Sold for ~$1.0B

  BMO and Royal Bank of Canada have agreed to sell jointly-owned Moneris Solutions Corporation to Francisco Partners for total cash consideration of approximately $2.0 billion, with BMO's 50% share amounting to ~$1.0 billion.

• $600M After-Tax Gain Expected

  Upon closing, BMO expects to record an after-tax gain of approximately $600 million ($620 million pre-tax), which will be recognized in Non-Interest Revenue in Corporate Services as an adjusting item.

• CET1 Ratio Boost of ~15 bps

  On a pro forma basis, the transaction is expected to improve BMO's common equity Tier 1 (CET1) ratio by approximately 15 basis points, enhancing the bank's capital position.

• New Exclusive Referral Arrangements

  Concurrent with closing, BMO and RBC will enter into new exclusive, long-term referral arrangements with Moneris, ensuring continued client access to payment solutions.

auto_awesomeAnalysis · BMO · Finance

By selling its 50% stake in Moneris Solutions Corporation to Francisco Partners for approximately $1.0 billion in cash, BMO will realize a $600 million after-tax gain and add roughly 15 basis points to its CET1 ratio. The transaction bolsters the bank's capital position while preserving client access to Moneris through new exclusive referral agreements. This material divestiture directly improves regulatory capital and delivers a one-time earnings boost, though it is not expected to materially affect future run-rate earnings.