Skip to main content

The waiter arrives to jot down Louis Vachon's order at 357c, a tony private club located in the old Port of Montreal building on the shores of the St. Lawrence, and the head of National Bank of Canada knows exactly what he wants. "Mozzarella di Bufala," he says confidently, and without hesitation.

The quick response is almost visceral, a throwback to his days on the trading desk where he cut his teeth in banking during the 1980s. The biggest skill he learned during those formative years was to act swiftly - and to never second guess yourself.

But then he does.

"You know what?" Mr. Vachon tells the waiter in French, pausing momentarily to ponder the rest of the appetizers. "Saumon." Smoked salmon it is. A fine choice, the waiter scribbles dutifully. And for the main course? Also salmon, but grilled.

This is the other side of Mr. Vachon showing through: the bank CEO. Having ascended to the top job at Canada's sixth-largest bank, he has learned over the years the importance of taking a moment to consider all the options.

"I'm still quite quick, but less quick as I used to be," he says. "I tend to ask more questions before pulling the trigger. It's one of the things you learn in life."

It's a fitting way into a discussion about all the headlines National Bank has been making these days, as one of the key players behind the Maple Group - a collection of 13 Canadian financial institutions trying to thwart the merger between TMX Group and the London Stock Exchange Group, the holding companies of the Toronto Stock Exchange and London Stock Exchange.

Normally found in the background of the banking sector, somewhere behind the Big Five Toronto-based banks who usually command the spotlight, Mr. Vachon's little Montreal outfit has found itself front and centre in the debate over the future of Canada's largest bourse. National's vice-chairman, a former Montreal Stock Exchange executive, is the face of the Maple group, and National is a driving force behind it.

Back when the LSE Group first announced its "merger of equals" with the TMX Group in Toronto, the deal might have seemed palatable for all the reasons the two sides were touting - a global exchange and broader access to capital throughout the world for Canadian companies. But for Mr. Vachon, and the heads of the other members of the Maple Group, it didn't take long before they figured there might be a better option on the menu. So the group decided to try to buy it themselves.

"I think the offer is underwhelming," Mr. Vachon says of the LSE bid, which, at about $44.69 a share, is less than the cash-and-share offer of $48 the Maple Group has put forward. His bigger concern, however, is Canada losing its control over the exchange should the LSE continue buying up bourses - leaving the TSX merely a small cog in a larger machine. "The strategy of London is one of consolidation. So the TSX is one of many [mergers]to come. You don't know who the other partners will be. They certainly don't want to give guarantees as to jobs or whatever else for Toronto or Montreal."

Unlike Mr. Vachon's smoked salmon, which arrives unadorned and fleshy pink a few moments later, the Maple Group proposal comes glazed in a thick patriotic syrup. Critics at the TMX and LSE say the banks, pension funds and insurance companies behind the Maple Group are wrapping themselves in a protectionist flag with the ultimate goal of creating a monopoly in exchanges, combining the banks' Alpha exchange with the TSX.

Indeed, the group is having an impact. Mr. Vachon is pleased by the morning headlines in the Montreal newspapers. A day earlier, Quebec financial giant Desjardins announced it was joining the Maple Group to fight the takeover, wanting to keep TMX Canadian-owned. A local newspaper proclaimed: "Desjardins joins the resistance!" He likes the language.

But despite that momentum, Mr. Vachon and Maple Group have a big problem on their hands. Even if they can convince regulators in Quebec and Ontario, and shareholders across the country, to turn down the LSE merger and side with their offer, Maple still must somehow convince the federal Competition Bureau that their idea to merge the bank-owned Alpha exchange with the TMX and its other clearing functions is not anti-competitive. This is by no means a small hurdle.

"I'm obviously optimistic," Mr. Vachon says. "I think we've shown in Canada we are quite good at finding an equilibrium in this balancing act."

Mr. Vachon is an optimist by nature. His father ran a trucking company during the oil crisis in the 1970s, when gasoline prices soared and the recession caused the shipping business to dry up. He remembers family vacations at the beach clouded by the stress those years put on his father. It helped give him perspective during the financial crisis in 2009. "I had seen my father go through ups and downs," he said. "And I drew a lot of self-confidence from that."

In between bites, Mr. Vachon explains that he doesn't get out for lunch much, usually opting for the corporate dining room at National Bank's headquarters, since it's closer to the job. His obsession with salmon is what keeps him from ordering too much red meat. By the time salmoncourse No. 2 arrives, Mr. Vachon has put the issue of Maple behind him and moved onto another pet topic - his plans for expanding National Bank across Canada.

Only a few weeks earlier, the bank expanded its reach into Western Canada with the purchase of the 83 per cent of Wellington West Holding Inc. that it didn't own. The deal balances out National's revenue base - about 45 per cent of its wealth management revenue will now come from outside Quebec. "So we're almost 50-50," Mr. Vachon says.

Similarly, in wholesale banking, where National has moved aggressively in recent years, the bank gets 60 per cent of its revenue outside Quebec. These aren't merely coincidences, either. Mr. Vachon has national aspirations.

"We want to continue to expand. The new frontier for us is the rest of Canada, so we remain focused on expanding outside Quebec," he says. Only in retail banking - the bricks and mortar branches - is National still focused primarily on its home province. More than 70 per cent of retail banking revenue comes from Quebec. Of its 450 locations, only 110 are outside Quebec. However, National is about to open a new branch in Victoria.

But getting bigger will be a methodical process - more evidence that the former trader with the snap decisions now wants to take his time. "Are there areas where we could be bigger? Yes," he says. "But we're going to do it in a very disciplined, targeted way."



Born in 1962. Raised in Lévis, Que., across the river from Quebec City. Grew up on the same street in Lévis as his wife of 20 years. They have a son, 17, and a daughter, 15.

After high school, went to college in the United States. Earned a BA in economics from Bates College in Lewiston, Me., and a Masters of International Finance from the Fletcher school of law and diplomacy at Tufts University.

Got his start in banking at Citibank, which recruited him to New York then moved him to Toronto. Joined National Bank in 1997.

Played hockey as a boy, played rugby in college. Took up the Japanese fencing art known as Kendo.


Descendant of the Vachon cakes empire, started by his great-grandparents. The company sold bread door to door in Quebec and expanded into cakes, including its most famous product, the Jos Louis. Named after the boxer Joe Louis, the company ran into copyright problems. To settle the dispute, Vachon's great-grandfather changed the name slightly to Jos Louis, combining the names of his two sons Joseph and Louis. The business was eventually sold to the Saputo family.


Reading The Billion Dollar Sure Thing, by Paul Erdman. "During the second semester of my freshman year in Economics 102, the professor assigned us this book to read. Paul Erdman invented financial novels. It was about the financial system at the time, about Swiss banks and trading in currencies and trading in gold and so forth. I thought this was pretty good. And I've been on that track since then."


Second to marrying his wife, his decision to attend college in the United States, despite not being fluent in English, is the best call Mr. Vachon says he ever made. "My English was so-so, but I didn't get bogged down in details. I could read and write, but to speak it was so-so. I somehow managed to get through the SAT [college admissions exam]and the interview process."


On Canadian banking weathering the financial crisis

"At some point we cannot rest on our laurels and fall into the trap of hubris. I don't think we are genetically born superior to anybody. There was a mix of good management, better regulatory environment and luck. And anybody who thinks it's not a combination of the three could be up for a rude awakening at some point."

On staying calm amid the banking storm

"I grew up in a business family. And I know the ups and downs of business. So when things got rough in 07-08, it didn't make it pleasant but I was not destabilized by it. Because I had seen my father going through ups and downs, and my grandfather going through ups and downs. And I drew a lot of self-confidence from that, saying they made it through, I'll make it through."

On managing a bank

"Coming from the trading side, I was very quick at making decisions. I'm still quite quick, but less quick as I used to be. I tend to ask more questions before pulling the trigger. It's one of the things you learn in life. The more I went up in terms of responsibility, the less you talk, the more questions you ask, and the more you listen. Your ears become more important than your tongue. I'm not saying it's not important to be a communicator, but in terms of making decisions, initially shut up and listen to people."

On National's 5-per-cent stake in the Montreal Canadiens

"It's complicated at home, because my wife tells me that I can't tell [majority owner]Geoff Molson how to run his team, or tell the coaches. So I have to abstain from making any comments on the hockey side. I'm bound to silence. But when I played hockey, the only ranking I was at the top of was the penalty rankings. So I'm not in a position to tell Geoff or anyone how to run that team."

Report an error

Editorial code of conduct

Tickers mentioned in this story