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Various buildings in downtown Toronto are from left CIBC; Bank of Montreal, 1 King West and Scotiabank (brown building).
Various buildings in downtown Toronto are from left CIBC; Bank of Montreal, 1 King West and Scotiabank (brown building).
(FRED LUM/THE GLOBE AND MAIL)

Private equity firms muscling in on Canadian banks’ commercial lending

A growing roster of private equity firms hoping to buy or lend to small and mid-sized Canadian companies has the country’s biggest banks on edge, forcing them to reassess their long-standing commercial banking strategies out of fears of getting left behind.

Canada’s banks developed their commercial banking arms over decades by lending to companies that typically generate annual revenue of $50-million or less, nurturing scores of client relationships. Since the financial crisis, however, private equity firms have been scooping up smaller companies, shaking up their historical banking relationships.