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Canadian Western Bank mentioned it delayed the discharge of its fiscal fourth-quarter earnings Friday as a result of it acquired a authorized declare in opposition to a financial institution division that wanted investigation.
The case gained’t have an effect on its sale to National Bank of Canada, it mentioned.
The declare involving CWB Maxium Financial Ltd. comprises “allegations of unethical conduct by a named particular person” who’s a gross sales agent of Maxium, the corporate mentioned in a press release Saturday. Canadian Western mentioned the claimant is in search of damages of $18 million associated to loans that had been granted to affiliated firms.
“Based on present data, we don’t count on the result of this declare to have a cloth impact on the consolidated monetary statements,” the financial institution mentioned within the assertion.
Analysts count on Canadian Western to report earnings about $85 million on an adjusted foundation for the quarter ended Oct. 31, based on information compiled by Bloomberg.
The financial institution mentioned the case is unrelated to its potential acquisition by National, which was introduced in June and valued Canadian Western at about $5 billion. CWB mentioned it nonetheless expects the deal to shut on the identical timelines as earlier than. The transaction has acquired the blessing of competitors authorities in Canada however nonetheless wants the approval of the federal government.
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Canadian Western Bank plunges as outcomes delayed
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National Bank will get approval to purchase CWB in ‘main step’
Shares of Canadian Western dropped greater than 5 per cent Friday in Toronto, erasing greater than $300 million in market worth for its largest single-day fall since May 2023. The lender issued a information launch earlier than the market opened Friday morning that pledged to report the outcomes by mid-December and cancelled a scheduled convention name.
With help from Susanne Barton
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