EQB Inc. T.EQB

Alternate Symbol(s): T.EQB.P.C | EQGPF

Financial Services

EQB Inc. operates through its wholly owned subsidiary Equitable Bank. Equitable Bank provides diversified personal and commercial banking through its EQ Bank platform. The Company operates through two main divisions: Personal Banking and Commercial Banking. Its Personal Banking segment consists of deposits, single family residential mortgage loans, home equity lines of credit, reverse mortgages, insurance lending, and payment infrastructure partnerships. Its savings products are offered through EQ Bank, Equitable Bank, Equitable Trust, and a network of independent financial planners and brokers. Its Commercial Banking segment lends loans through a network of mortgage and leasing brokers, lending partners, and other financial institutions. Commercial loans involve lending on multi-unit residential, industrial and office buildings, and other commercial properties. It also specializes in the creation, structuring, and management of pooled Canadian commercial mortgage funds.

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EQB Inc.

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Post by retiredcfon Oct 03, 2023 10:53am

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Post# 35666796

TD

Currently have a $90.00 target. GLTA

EQB Inc.

(EQB-T) C$75.20

Acquiring Commercial Mortgage Alternative Manager

Event

EQB Inc. is acquiring 75% of ACM Advisors Ltd.

Impact: SLIGHTLY POSITIVE

This morning, EQB announced that they are acquiring a 75% stake in ACM Advisors Ltd (ACM), an alternative manager specializing in the origination and management of pooled Canadian commercial mortgage funds. Our initial take is slightly positive given it is expected to be accretive, it is in line with their strategy, and they are issuing only a small amount of equity to fund the deal. Conference call is at 9 am; 416-764-8668 or here.

The transaction is expected to be accretive in the first year. Management expects the acquisition to close before calendar year-end, subject to regulatory approvals. The acquisition will be largely financed by cash and EQB's existing lending facilities with a "de minimis" number of EQB shares to be issued at close. An acquisition price was not disclosed.
We view this transaction as in-line with EQB's expertise in commercial mortgages and their desire to add asset and wealth management capabilities. EQB has a long history in commercial mortgage lending and has a commercial loan portfolio of $28bln, ~70% of which is invested in multi-unit residential housing. This transaction will add on a fee-based revenue stream, helping to add diversification from their core interest-based income. We see potential for some cross-selling opportunity across EQ Bank's ~380k customer footprint (digital bank).
Vancouver-based ACM has $4.8bln in AUA across four funds. Under the current leadership, ACM has almost doubled AUM over the L5Y period. Existing management is expected to remain with the business including the current CEO and COO. ACM's client base includes 200 institutions as well as accredited retail investors.