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B2B Bank, Coming in July

François-Desjardins-B2B-BankPending regulatory approval, B2B Trust will convert to B2B Bank on July 7, 2012. It will be Canada’s newest bank, and a fully-owned subsidiary of Laurentian Bank of Canada.

To get a feel for what this means to mortgage consumers and brokers, we did some email Q&A with François Desjardins, President and CEO of B2B Trust. Here’s some of that dialogue…

CMT: How long ago did B2B Trust first apply to OSFI to become a bank?

François: B2B Trust started the process of becoming B2B Bank by filing an application to OSFI in June 2010. It’s with great pleasure that, pending regulatory approval, B2B Bank will officially launch on July 7, 2012.

CMT: What are the primary reasons why B2B Trust is changing to B2B Bank? Does it reflect a strategy to more-aggressively expand outside of Quebec?

François: Essentially, B2B Trust is becoming B2B Bank because doing so better reflects the scope and nature of our banking business, which is lending and deposit-taking. We have also conducted extensive research on the matter and concluded that, overall, clients prefer dealing with banks over trust companies. Of course, our key differentiator continues when we become B2B Bank, and that is our continued dedication to – and focus on – the adviser and mortgage broker communities.

CMT: In terms of mortgage rates, products or lending guidelines, is there anything that bank status may allow B2B to offer brokers (and therefore homeowners) that B2B Trust did not?

François: Becoming a bank doesn’t impact our lending guidelines or the rates and product suite we offer through mortgage brokers. Rather, the launch of B2B Bank-funded mortgages has a three-fold benefit to brokers and their clients:

1) B2B Bank will be 100% broker focused and our goal is to help brokers build their business. We felt it was important to clearly distinguish ourselves and have all of our products – including mortgages – sold under the “B2B” name.  While we are already a recognized leader in the financial advisory community, our intention is to build recognition of the B2B Bank brand (and attain leadership status) in the mortgage broker space as well.

2) Offering our own B2B Bank-funded mortgages enables us to round out our comprehensive product offering;

3) Lastly, it means we can be more transparent so that we can serve the broker community efficiently under one entity and one brand, where previously its mortgages were under the Laurentian Bank banner.

CMT: Will being a bank impact B2B’s securitization activities and mortgage funding program?

François: As a bank, we are fortunate to have several different sources of funding which include: securitization, our healthy deposit portfolio, our affiliation with a larger entity – our parent company, Laurentian Bank of Canada.

Our securitization strategy will remain the same. We are doing securitization for funding purposes and we will continue to do such transactions based on our corporate funding needs.

CMT: Thank you François.

Sidebar:  If you’re an existing Laurentian Bank mortgage customer, this change should impact you very little. Here’s some additional info…

Upon conversion, B2B Bank will offer an enhanced version of Laurentian Bank’s HELOC. More on that, and some FAQs on the conversion, are available here.

Rob McLister, CMT