First Nation Bank of Canada President & CEO Bill Lomax in Ottawa in June, 2023. The Lheidli T’enneh First Nation will acquire 8.64 per cent of FNBC, the bank announced Friday.Dave Chan/The Globe and Mail
First Nations Bank of Canada is raising $10-million in equity financing as the country’s largest Indigenous-owned financial institution responds to booming demand for new business loans.
The Lheidli T’enneh First Nation will acquire 8.64 per cent of FNBC, the bank announced Friday, with the transaction split between the nation itself and its business development arm: Tano T’enneh Enterprises. The announcement was made during a community celebration at the Lheidli T’enneh office in Prince George.
Earlier this month, FNBC sold $9-million worth of equity to five other Indigenous groups and communities, bringing the Saskatoon-based bank closer to its goal of raising $50-million in new equity financing before the end of this year.
In an interview, FNBC chief executive officer Bill Lomax said there is “a lot of momentum right now, so it is entirely possible we will be done later this fall.”
Raising $50-million will give FNBC the ability to directly issue at least $400-million worth of new loans, he said. Partnerships with the Canada Infrastructure Bank and the Business Development Bank of Canada will allow FNBC to facilitate lending more than half a billion dollars to Indigenous communities across Canada.
“We are talking about many hundreds of millions of dollars more over the next couple of years; the impact could be anywhere from half a billion to a billion dollars,” Mr. Lomax said.
“The money that we get, we will put to work very easily over the next, call it 18 to 24 months. Then we might have to get out there again just because the demand is so high.”
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FNBC has a backlog of loan applications, Mr. Lomax said, as more Indigenous communities look to start businesses, buy existing businesses and build critical infrastructure.
“It is a wide range of things that we are putting capital to work on,” he said.
Infrastructure projects FNBC supports run the gamut from new roads to community centres, hockey arenas, hotels and commercial service centres, Mr. Lomax said.
Financial resources available to Indigenous communities across Canada have grown considerably in recent years. The gains have come through a combination of business growth, new business formation, multibillion-dollar government settlements and various programs aimed at closing the projected $349.2-billion infrastructure gap between Indigenous and non-Indigenous communities.
“The sophistication of nations has just increased so dramatically over the past 10 to 20 years,” Mr. Lomax said. “They now have capital and opportunities that they did not have in, say, the nineties or before.”
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FNBC has capitalized on that heightened financial sophistication, with total assets growing from $1.3-billion when Mr. Lomax first joined FNBC in mid-2023 to $1.477-billion today. Its commercial banking division has been growing at roughly 10 per cent annually in terms of the total amount of net new loans issued for the past several years, Mr. Lomax said, but this year he expects that part of the business to grow by between 20 per cent and 25 per cent.
Measured from mid-2023, Mr. Lomax said he expects the commercial banking business to double in size within the next three years.
All that growth has come at a cost to other initiatives, such as establishing wealth management services that would allow the bank to oversee registered education and retirement savings plans for its clients. Mr. Lomax had previously targeted late 2025 to launch a wealth management offering.
“The reality is that our commercial banking business has been growing at such a pace that it has taken a lot of my focus, and it is currently one of the largest financial drivers for the bank,” Mr. Lomax said.
“We have had to put [wealth management] on a bit of a backburner for the moment, but it is not forgotten, and we will get there. That will likely be something we look into more seriously next year.”
FNBC was founded in 1996 by the Saskatchewan Indigenous Enterprise Foundation Inc., the Federation of Sovereign Indigenous Nations and Toronto-Dominion Bank. TD Bank sold off its stake by 2009 and today, FNBC is 88 per cent Indigenous-owned.