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Laurentian Bank of Canada Reaches Agreement to Acquire a Leading Inventory Finance Lender, Reinforcing Its Equipment Finance Business

- Approximately $1.2 billion(i) equipment finance portfolio

MONTREAL, QUEBEC -- (Marketwired) -- 05/18/17 -- Laurentian Bank of Canada ("Bank") (TSX: LB) announced today that it has reached a definitive agreement under which a subsidiary of the Bank has agreed to acquire Northpoint Commercial Finance, which is among the leading US and Canadian inventory finance lenders with a portfolio of approximately $1.2 billion as at March 31, 2017. The transaction is expected to close before the end of fiscal 2017, subject to customary closing conditions, including applicable regulatory notifications and approvals.

The Bank believes Northpoint Commercial Finance, which was founded in 2012, is one of only a few diversified inventory finance companies that provides the scale needed to serve North American manufacturers and their dealer networks.

"We are delighted to announce this acquisition that will increase the proportion of revenue generated by commercial activities within the bank mix, which is expected to improve its overall profitability," said Francois Desjardins, President and Chief Executive Officer of Laurentian Bank of Canada. "We continue to make excellent progress on our transformation plan initiatives, including, among others, the optimization of our retail banking activities and the development of our core banking system, the backbone of our digital offer."

"This acquisition is an excellent strategic fit with our equipment finance subsidiary, LBC Capital, resulting in an attractive end-to-end equipment finance platform. It will broaden our Canadian offering and create a US presence, an important customer attribute for manufacturers and dealers looking for a single North American point of service," added Stephane Therrien, Executive Vice President, Personal and Commercial Banking at Laurentian Bank. "Northpoint team members led by Chief Executive Officer, Dan Radley, have years of experience in inventory financing, unique expertise and strong client relationships with leading companies. We are very happy to welcome them as they join the team under the leadership of Eric Provost, Senior Vice President, Commercial Banking at Laurentian Bank and President of LBC Capital."

The Bank believes this acquisition will be accretive to its earnings per share in the first full year of operation and by approximately 4% in 2019. Based on the anticipated assets on closing and the related equity financing, it is expected the Bank's Basel III Common Equity Tier 1 ratio would be maintained within the guided 7.8% to 8.2% range. The Bank plans to finance the acquisition through a $225 million subscription receipts equity financing (the "Equity Financing") and existing balance sheet liquidity.

(i) All dollar amounts are expressed in Canadian dollars.

The securities mentioned herein have not been and will not be registered under the United States Securities Act of 1933, as amended, (the "U.S. Securities Act") or the securities laws of any state of the United States and may not be offered or sold within the United States or to a U.S. person absent registration or pursuant to an available exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. There will be no public offering of securities in the United States. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction. No securities regulatory authority has either approved or disapproved of the contents of this press release.

Conference call

A conference call is scheduled to take place on May 18, 2017 at 5:00 p.m. (ET).

The live, listen-only, toll-free, call-in number is 1-888-349-9618, code 6705639. A live webcast will also be available on the Bank's website under the Laurentian Bank tab, Investors, Presentations and Events (https://www.banquelaurentienne.ca/en/about_lbc/my_investment/presentations.html).

The conference call playback will be available on a delayed basis on the Bank's website under the Laurentian Bank tab, Investors, Presentations and Events.

The presentation material referenced during the call will be available on the Bank's website under the Laurentian Bank tab, Investors, Presentations and Events.

About Laurentian Bank

Laurentian Bank of Canada is a financial institution whose activities extend across Canada. Founded in 1846, its mission is to help customers improve their financial health and it is guided by values of proximity, simplicity and honesty.

The Bank serves one and a half million clients throughout the country and employs more than 3,600 individuals, which makes it a major player in numerous market segments. The Bank caters to the needs of retail clients via its branch network based in Quebec. The Bank also stands out for its know-how among small and medium-sized enterprises and real estate developers owing to its specialized teams across Canada. Its subsidiary B2B Bank is, for its part, one of the major Canadian leaders in providing banking products and services and investment accounts through financial advisors and brokers. Laurentian Bank Securities offers integrated brokerage services to a clientele of institutional and retail investors.

The Bank has more than $43 billion in balance sheet assets and more than $32 billion in assets under administration.

About Northpoint Commercial Finance

Headquartered in Alpharetta, Georgia, with approximately 90 employees, Northpoint Commercial Finance has a leading presence in financing a range of products across major industries through relationships with hundreds of manufacturers and thousands of dealers across the US and Canada. Led by an experienced management team, averaging 25 years of experience, Northpoint offers diversified financial solutions such as inventory lending and floor plan finance. As a knowledgeable lender, Northpoint offers a wide array of program structures to meet the needs of original equipment manufacturers, distributors, resellers, and dealers in a variety of commercial product industries. The team offers a creative, flexible and personal approach combined with innovative technologies, and streamlined processes. For more information about Northpoint's product offerings, visit www.northpointcf.com.

Caution Regarding Forward-looking Statements

In this document and in other documents filed with Canadian regulatory authorities or in other communications, Laurentian Bank of Canada may from time to time make written or oral forward-looking statements within the meaning of applicable securities legislation. Forward-looking statements include, but are not limited to, statements regarding the Bank's business plan and financial objectives. The forward-looking statements contained in this document are used to assist readers in obtaining a better understanding of the Bank's financial position and the results of operations as at and for the periods ended on the dates presented and may not be appropriate for other purposes. Forward-looking statements typically use the conditional, as well as words such as prospects, believe, estimate, forecast, project, expect, anticipate, plan, may, should, could and would, or the negative of these terms, variations thereof or similar terminology. Some of the specific forward-looking statements in this document include, but are not limited to, statements with respect to the expected timing and completion of the acquisition described herein, the anticipated sources of financing thereof; the fact that closing of the acquisition is subject to certain conditions; anticipated benefits of the acquisition, including the expected impact on the Bank's activities, attributes, profile, revenue mix, geographic reach, profitability, earnings per share and anticipated accretion thereto; expectations regarding the Bank's transformation plan and strategy, the maintenance of the Bank's Basel III Common Equity Tier 1 ratio, the retention of Northpoint Commercial Finance management and employees, and the strategic fit of the acquisition.

By their very nature, forward-looking statements are based on assumptions and involve inherent risks and uncertainties, both general and specific in nature. It is therefore possible that the forecasts, projections and other forward-looking statements will not be achieved or will prove to be inaccurate. Although the Bank believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. Certain important assumptions by the Bank in making forward-looking statements include, but are not limited to: the satisfaction of all conditions to the completion of the acquisition and the Equity Financing within the anticipated timeframe; the maintenance of the Bank's Basel III Common Equity Tier 1 ratio; the Bank's ability to execute its transformation plan and strategy; the successful and timely integration of the Bank and Northpoint Commercial Finance and the realization of the anticipated benefits and synergies of the acquisition in the timeframe anticipated, including impact and accretion in various financial metrics; the ability to retain management and key employees of Northpoint Commercial Finance; desired attributes of an equipment finance platform; the ability of the Bank to access the capital markets; the absence of significant undisclosed costs or liabilities associated with the acquisition; the absence of significant changes in foreign currency exchange rates or significant variability in interest rates; the ability to hedge exposures to fluctuations in interest rates and foreign exchange rates; the expectation of regulatory stability; no downturn in economic conditions; sufficient liquidity and capital resources; no material changes in competition, market conditions or in government monetary, fiscal and economic policies; and the maintenance of credit ratings.

The Bank cautions readers against placing undue reliance on forward-looking statements when making decisions, as the actual results could differ considerably from the opinions, plans, objectives, expectations, forecasts, estimates and intentions expressed in such forward-looking statements due to various material factors. Among other things, these factors include: the failure or delay to receive or fulfill regulatory approvals and notifications or otherwise satisfy the conditions to the completion of the acquisition or Equity Financing; potential undisclosed costs or liabilities associated with the acquisition; historical and pro forma consolidated financial information may not be representative of future performance; reputational risks and the reaction of the Bank's and Northpoint Commercial Finance's personnel and customers to the transaction; the failure to realize, in the timeframe anticipated or at all, the anticipated benefits and synergies of the acquisition; factors relating to the integration of the Bank and Northpoint Commercial Finance, diversion of management time and unanticipated costs of integration; the Bank's limited experience in the U.S. market and in inventory financing; difficulties in the operation of the Bank's transformation plan and in particular the reorganization of retail branches, the modernization of the core banking system and adoption of the Advanced Internal Ratings-Based approach to credit risk; exchange rate risk; foreign currency exposure risk; changes in capital market conditions, changes in government monetary, fiscal and economic policies, changes in interest rates, inflation levels and general economic conditions, legislative and regulatory developments, changes in competition, adverse modifications to credit ratings, scarcity of human resources, and developments in the technological environment.

The Bank further cautions that the foregoing list of factors is not exhaustive. For more information on the risks, uncertainties and assumptions that would cause the Bank's actual results to differ from current expectations, please also refer to the Management's Discussion and Analysis under the title "Risk Appetite and Risk Management Framework" in the Bank's Annual Report, as well as to other public filings available at www.sedar.com.

The Bank does not undertake to update any forward-looking statements, whether oral or written, made by itself or on its behalf, except to the extent required by securities regulations.

Contacts:
Susan Cohen
Director, Investor Relations
Laurentian Bank
514-284-4500, ext. 4926
[email protected]

Helene Soulard
Assistant Vice President, Communications
Executive Office
Laurentian Bank
514-284-4500, ext. 8232
[email protected]

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