Royal Bank of Canada and BMO unload their joint payments venture for approximately $2 billion
Royal Bank of Canada (TSX: RY) and BMO Financial Group (TSX: BMO) have agreed to sell their jointly owned subsidiary, Moneris Solutions Corporation, to San Francisco-based Francisco Partners for approximately $2 billion. Each bank holds a 50% stake in the transaction. The deal is expected to close by the end of the first quarter of fiscal 2027, subject to regulatory approvals.
RBC expects to record an after-tax gain of approximately $475 million ($560 million pre-tax), which will be treated as an adjusting item.
BMO projects a larger after-tax gain of approximately $600 million ($620 million pre-tax). Neither bank expects the transaction to have a significant impact on future run-rate earnings.
A 25-year Canadian payments institution
Founded in December 2000, Moneris has grown into one of Canada's largest commerce solutions providers, handling payments at more than 325,000 points of commerce.
The company processes roughly one in three card transactions in Canada and employs approximately 1,900 people.
The sale fits a pattern of balance sheet discipline visible across the Big Six. Matthew Lee of Canaccord Genuity Corp. described the deal as "incrementally positive for both banks, crystallizing value from a non-core asset, adding capital to the war chest," and noted that it "fits the broader sector trend of banks simplifying their balance sheets and monetizing non-core holdings to redeploy capital."
The move aligns with recent reporting on BMO's second-quarter 2026 financial results, which showed Canada's third-largest bank steadily strengthening its capital position while trimming non-priority assets — including an earlier agreement to sell 138 US branches to First Citizens Bank.
RBC's record first-quarter 2026 profit of $5.8 billion, driven by wider lending spreads and strong market performance, positions it similarly.
Referral arrangements keep clients connected
Despite the ownership transfer, both banks have secured exclusive, long-term customer referral arrangements with Moneris, ensuring continuity for existing and future business clients.
Sean Amato-Gauci, RBC's group head of commercial banking, said Moneris "has played a central role in enabling Canadian businesses to modernize and scale by connecting them with more consumers more often through innovative payments solutions across the commerce ecosystem," adding that the company's platforms "will be leveraged and amplified by Francisco Partners in this next stage of growth."
Sharon Haward-Laird, BMO's group head of Canadian commercial banking, said the transaction "will enable Moneris to build on that strong foundation while accelerating its strategy in a rapidly evolving payments landscape."
Francisco Partners, whose portfolio spans payments technology companies including Verifone and Hypercom, said it sees significant long-term opportunity with Moneris "while preserving the deeply Canadian identity" of the business, according to firm partner Peter Christodoulo.
RBC projects a marginally positive impact to its common equity Tier 1 (CET1) ratio on closing, while BMO expects its CET1 ratio to improve by approximately 15 basis points.
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