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National Bank of Canada

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This article is about a private commercial bank in Canada. For Canada's central bank and monetary authority, see Bank of Canada.
National Bank of Canada
Company typePublic
TSX: NA
S&P/TSX 60 component
IndustryBanking
Predecessors
FoundedNovember 1979; 45 years ago (1979-11)[note 1]
HeadquartersMontreal, Quebec, Canada
Key people
Laurent Ferreira (CEO)
ProductsFinancial services, Commercial banking
Services
RevenueIncrease Can$11.40 billion (2024)[3]
Increase Can$3.82 billion (2024)[3]
AUMIncrease Can$155.90 billion (2024)[3]
Total assetsIncrease Can$462.23 billion (2024)[3]
Total equityIncrease Can$25.55 billion (2024)[3]
Number of employees
29,196 (2024)[3]
Websitewww.nbc.ca

The National Bank of Canada (French: Banque Nationale du Canada) is the sixth largest commercial bank in Canada. It is headquartered in Montreal, and has branches in most Canadian provinces and 2.4 million personal clients.[4] National Bank is the largest bank in Quebec, and the second largest financial institution in the province, after Desjardins credit union. National Bank's Institution Number is 006 and its SWIFT code is BNDCCAMMINT.

History

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A Banque Nationale branch in Chicoutimi, 1892

In 1859, francophone businessmen in Ontario and Quebec were keen to establish a bank under their local control, and persuaded the provincial legislature to pass the act that created the Banque Nationale on May 4, 1859. Some members of the anglophone bourgeoisie participated in the bank's share capital, but francophones retained exclusive control and held all seats on the board of directors with Ulric-Joseph Tessier, lawyer and Member of the Legislative Assembly serving as chairman of the bank.

The bank suffered losses during the banking crisis sparked by the financial panic of 1873 and panic of 1884 but managed to survive and continued to operate. In the 1930s, during the Great Depression, Banque Nationale again came under financial stress; this time a merger was arranged with Banque d’Hochelaga assisted by the province's legislature to strengthen the bank. The merged bank was renamed "Banque Canadienne Nationale" (BCN) (English, "Canadian National Bank").

In 1968, BCN, in conjunction with a number of other banks, launched Chargex, the first credit card to be issued by a Canadian bank.

During the 1970s, Quebec-based rival Provincial Bank of Canada expanded rapidly through a number of acquisitions. It merged with the People's Bank in 1970, with the Toronto-based Unity Bank of Canada, and in 1979 it acquired Laurentide Financial Corporation of Vancouver. Provincial Bank and BCN continued to expand but continued to have a large part of their operations concentrated in Quebec. In November 1979, these two banks decided to merge under the new name "National Bank of Canada" in what was at the time one of the largest bank mergers.

Post-merger

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Through the 1980s the bank continued to grow and expand its businesses through a number of acquisitions, including the brokerage firm Lévesque Beaubien and a year later Geoffrion Leclerc, which became known as Lévesque Beaubien Geoffrion. In 1993, it sold its lease financing operations to GE Capital and acquired the assets of General Trust of Canada.

A National Bank of Canada sign outside Exchange Tower in Toronto

In 1994, it made a small step outside Canada when it opened two branches in the United States, one in Florida and one in California. As of 2020, its Natbank subsidiary has three branches, all in Florida. In 1995 the bank opened a representative office in Cuba to assist Canadian clients doing business in the country.[5] In 1999 it concluded its purchase of First Marathon, a Toronto-based brokerage firm. First Marathon and the Bank's subsidiary Lévesque Beaubien Geoffrion Inc. merged their operations to form National Bank Financial (NBF), its investment banking subsidiary. In 2002 it acquired US-based investment bank Putnam Lovell and merged the operations with its NBF subsidiary which started operating through offices in New York, Toronto, and London.

Place Banque Nationale, the new headquarters completed in 2024[6]

In March 2006, it sold its shareholder management services to Computershare.[7]

In 2016, it acquired 90 percent of the shares of ABA Bank of Cambodia (formerly known as the Advanced Bank of Asia). In 2019, it acquired the remaining 10 percent that had been held by a former head of the Kazakhstan Stock Exchange, Damir Karassayev.[8]

In October 2019, National Bank of Canada was criticized by privacy experts for requiring new online customers to provide their full login credentials for accounts with other financial institutions, including password.[9][10] On its website, the bank tells clients to "Never tell anyone your password",[11] yet during the process of creating an account, they say, "... you will need to provide... your login credentials with another eligible Canadian financial institution".[12]

On June 11, 2024, National Bank announced plans to acquire Canadian Western Bank by the end of 2025 for $5 billion.[13] Canadian Western shareholders voted to approve the merger on September 3, 2024.[14]

Operations

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In August 2021, National Bank brokerage became the second Canadian financial institution to offer free online direct brokerage after Wealthsimple introduced it first.[15]

On October 31, 2019, National Bank had a network of 422 branches and 939 automated teller machines in Canada.[16] It also had a representative offices, subsidiaries and partnerships in other countries, through which it serves Canadian and non-Canadian clients. It owns ABA Bank in Cambodia.

National Bank's business is concentrated in Quebec, and it is expanding in other provinces. For the year ending October 31, 2017, 59% of its total revenues were from Quebec, 30% from other provinces, and 11% from its international operations.[3] Its total revenue for the year were allocated across the following business segments:

  • 44.8% from Personal and Commercial Banking,
  • 23.5% from Wealth Management,
  • 23.8% from Financial Markets, and
  • 7.9% from U.S. Specialty Finance and International.[3]

In 2011, National Bank was placed third in Bloomberg's list of "The World’s Strongest Banks".[17] In 2018, it placed 41st on Go back Finance's list of the 50 strongest banks.[18]

Management

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The management structure of the bank consists of an office of the President[19] and a board of directors.[20]

See also

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Notes

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  1. ^ The following date was when the Banque Canadienne Nationale and the Provincial Bank of Canada merged to form the National Bank of Canada. The former institution was established in May 1859, while the latter was established in 1861.[1][2]

References

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  1. ^ "History". www.nbc.ca. National Bank of Canada. 2021. Retrieved 11 May 2021.
  2. ^ "Who We Are". National Bank Financial. Archived from the original on 4 September 2017. Retrieved 14 March 2018.
  3. ^ a b c d e f g h "2024 Q4 Report" (PDF). Investor Relations. National Bank of Canada. Retrieved 9 December 2024.
  4. ^ "In Brief" (PDF). National Bank of Canada. October 31, 2014. Archived from the original (PDF) on September 21, 2018. Retrieved December 5, 2014.
  5. ^ "Foreign Banks: National Bank of Canada". Banco Central de Cuba. Archived from the original on 2016-04-29. Retrieved 2017-08-21.
  6. ^ "Place Banque Nationale - 40 étages". Retrieved 2024-06-29.
  7. ^ "National Bank History". National Bank of Canada. 2008. Archived from the original on 2013-12-20. Retrieved 2013-05-15.
  8. ^ "National Bank of Canada says has agreed to take full control of ABA Bank in Cambodia", Reuters.con, 28 Aug 2019
  9. ^ "Privacy experts slam National Bank asking customers for their password at other banks". CBC News. October 25, 2019.
  10. ^ "Privacy experts question National Bank's request to users for personal information". MobileSyrup. October 29, 2019.
  11. ^ "ABCs of security". National Bank of Canada. Retrieved 2019-10-29.
  12. ^ "New clients". National Bank of Canada. Archived from the original on 2019-10-29. Retrieved 2019-10-29.
  13. ^ https://www.cbc.ca/news/canada/edmonton/national-bank-reaches-deal-to-buy-canadian-western-bank-at-5b-valuation-1.7232023
  14. ^ "Canadian Western Bank shareholders approve National Bank takeover". The Globe and Mail. 4 September 2024.
  15. ^ Wilson, John (November 11, 2022). "Best Free Online Brokers in Canada".
  16. ^ National Bank of Canada Investor Factsheet 2019 Q4
  17. ^ Greenwood, John (May 9, 2011). "Canadian banks are world's strongest: Bloomberg, Moody's". Financial Post.
  18. ^ "Top 50 Safest Commercial Banks 2018", Global Finance Magazine, November 1, 2018
  19. ^ "Governance - Office of the President". National Bank of Canada. Retrieved 2014-07-18.
  20. ^ "Governance - Board of Directors". National Bank of Canada. Retrieved 2014-07-18.
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