Canadian Banks Cash Out of Moneris for $2B as Lenders Retreat from Payments Processing

Royal Bank of Canada (RBC) and Bank of Montreal (BMO) are selling Moneris, a payments processor they jointly own, to US private equity firm Francisco Partners for $2 billion. The deal is expected to close by January 2027.

The banks will split the proceeds equally, with RBC expecting an after-tax gain of around $475 million and BMO expecting about $600 million. This sale marks a trend among lenders shedding payments businesses due to the fast pace of digitization requiring steady capital spending.

Analysts frame this move as a case of capital discipline rather than retreat, freeing up capital from non-core assets. However, critics see it as another Canadian asset heading south, with concerns over foreign ownership of Canadian technology.