BMO has finalized two significant risk transfers encompassing approximately $5 billion in corporate loans. This move positions the bank among Canadian lenders leveraging robust investor demand for such financial instruments.

Through its Muskoka issuance program, BMO executed an SRT linked to a $2.5 billion portfolio of large corporate loans. Concurrently, the bank utilized its Algonquin program to transfer risk on a separate $2.5 billion portfolio of mid-market corporate loans. These transactions follow similar deals by peers like Toronto-Dominion Bank, Royal Bank of Canada, and National Bank of Canada.

The Muskoka SRT involved a first-loss piece exceeding 7% of the reference portfolio, priced under 700 basis points above a lending benchmark. The Algonquin transaction covered over 6% of its loan portfolio, priced in the mid-700 basis-point range. Both deals were concluded within the last two months. Investor interest in SRTs remains strong despite broader credit market pressures.