Canadian Fintech: Why did Scotia Invest in a US Bank? 🇺🇸
RBC counter sues ex-CFO. Fintrac underwater. QuickFacts raises.
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💰 Funding
QuickFacts, a tool for insurance brokers to search their carriers’ underwriting information, raised $2m.
The Nova Scotia based company raised $1 last year in convertible debt.
Andgo, a Saskatchewan based HR platform for managing employee shift work raised an undisclosed debt round.
Fisent, a process automation company for banks implementing Gen AI receives investment from Pegasystems, a larger US competitor.
Scotiabank is investing nearly $4b into Cleveland based bank KeyCorp for a 14.9% ownership stake. Why is this deal interesting?
This gives Scotia exposure to US retail banking for the first time ever.
This is a minority investment. Typically Canadian banks take majority stakes or wholly acquire banks in other markets (here are some examples). Keeping the investment under 20% is a much more cautious move.
This comes a few months after TD called off its $18b takeover of First Horizon, another US bank.
🤝 M&A
SONA, a Halifax based ISO (third party merchant payment processing company) was acquired by Celero, a much larger US competitor.
ISOs act as sales agents for payment processors, signing up merchants for in person and online payment services.
It’s common for them to be acquired by larger ISO groups or by processors themselves. For example, Peloton, a Vancouver based processor acquired KISS, an ISO they partnered with last year.
SONA was fully bootstrapped.
iA Financial acquired a book of over $130m in life insurance premiums from Prosperity, a US life insurer.
A MESSAGE FROM THE CANADA FINTECH FORUM
🚀 Product
Surecomp, a Toronto based trade finance management software partnered with Visa’s B2B Connect network to process large ticket international commercial payments.
NetNow is another Toronto based provider of back office trade finance software.
WonderFi, a crypto exchange, launched over-the-counter trading services in Australia.
The Toronto based company acquired an Australian competitor earlier this year.
RBC and Nadine Ahn, the bank’s ex-CFO are suing each other, after she was fired for allegedly having an affair with a coworker.
Prior to the dismissal Ahn was reportedly on a short list of candidates to take over the bank as CEO.
interVal, a tool for financial advisors to offer valuations of non-liquid assets, signed a referral partnership with FusionIQ, a US based wealth management workflow platform.
⚖️ Policy
Finance Canada launched a sweeping consultation on several controversial parts of Budget 2024 including open banking, amendments to the maximum allowable rate of interest, and capital gains taxes for entrepreneurs.
To jog your memory, here is a recap of Budget 2024.
Fintrac, this country’s money laundering regulator is still trying to restore all of its online services, five months after a cyberattack.
The workaround has been to have financial institutions submit “priority” suspicious transactions via Canada Post ePost system and for new MSB registrations to be emailed in.
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