Another Canadian financial institution is considering financing cannabis, should marijuana become legal in the country later this year. The chief executive of TD Bank says it would consider participating in cannabis sector financings after recreational marijuana becomes legal in Canada later this year.
According to CTV News, Bharat Masrani, the CEO of TD Bank, said after the company’s annual shareholders meeting that the Toronto-based bank views the federal legalization of pot for adult use as an “important data point.”
He told reporters:
We are studying the whole industry to see what are the key risks that we have to mitigate. That’s an ongoing process, and we will look at each individual request, or any customer of ours that may be wanting to get into that business, we will look at it on its own merits.
Back in January, the first of the Big Five banks, the Bank of Montreal, entered the cannabis space with a $175 million financing deal with licensed Canadian producer Canopy Growth.
As The Fresh Toast reported:
The Big Five were previously hesitant to enter the cannabis space, leaving the financial opportunity to smaller and regional banks. Part of their reluctance stems from the Big Five’s major dealings in the United States, where cannabis remains federally illegal as a Schedule I drug. That status likely won’t change anytime soon, as the Trump administration has made significant moves to roll back former federal protections offered in the cannabis space.
The move signaled a significant shift in thinking regarding cannabis among the banks.
Marijuana Business Daily reports that in late March, licensed producer Cronos Group said it was looking to raise up to $100 million Canadian dollars ($78 million) in the second equity financing between one of Canada’s biggest banks and a medical marijuana company.
Both financings involve BMO Capital Markets, a subsidiary of the Bank of Montreal.