Magazine article American Banker

Security Pacific to Buy Morguard Bank of Canada

Magazine article American Banker

Security Pacific to Buy Morguard Bank of Canada

Article excerpt

LOS ANGELES -- The Security Pacific Corp. has reached an agreement to acquire the Morguard Bank of Canada, a commercial bank based in Vancouver, British Columbia, from the Morguard Group Ltd. of Toronto.

Terms were not disclosed.

Canadian banking sources said the proposed sale of the Morguard Bank may reflect unease on the part of Canadian pension funds with their investment in the bank, particularly after the recent failure of Calgary-based Canadian Commercial Bank, in which several pension funds also had an interest.

The Morguard Bank, with 1984 assets of $322 million (Canadian), is 72% owned by the Morguard Group, which is wholly owned by the pension funds of Air Canada, the Alberta government telephone employees, Alberta teachers, Bell Northern Research Ltd., Canadian Broadcasting Corp., Canadian National Railway Co., DuPont Canada Inc., and Northern Telecom Ltd.

The Morguard Group was created in 1966 by Toronto pension fund advisers Boyd, Stott and McDonald Ltd. to give pension funds a vehicle to enter into mortgage lending ventures. By mid-1984, some $3.1 billion (Canadian) in mortgage assets were being administered by the group for 215 pension funds. (The Canadian dollar is currently worth about 72.6 U. …

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