EQB (EQB) M&A Announcement summary

Deal rationale and strategic fit

• Adds PC Financial’s credit cards, deposits, insurance distribution and payments capabilities, completing the everyday banking offering and broadening the funding base.

• Long-term exclusive financial partnership with Loblaw provides access to the PC Optimum program and 17MM+ members.

• Combines complementary digital banking and retail reach to accelerate personalization, product innovation and growth.

• Digitally engaged PC Financial customers have minimal overlap with the existing base, creating cross-sell opportunities.

Financial terms and conditions

• Acquisition of 100% of PC Bank, two PC Financial insurance entities and certain affiliates for estimated CAD 800MM, or 1.15x book value.

• Consideration includes 7.2MM common shares issued to Loblaw and cash funded from balance-sheet capacity, with no financing contingency.

• Loblaw is to receive ~$500MM in excess PC Bank capital before closing; total estimated value is $1.3B, and Loblaw will own at least 17% post-close.

• Expected mid-single-digit accretion to consensus 2027E Adjusted EPS, including run-rate cost synergies and before purchase-accounting impacts; accretive to ROE in the first full post-close year.

• Preliminary purchase accounting includes a $300MM pre-tax credit markdown, $50MM fair value increases and $230MM incremental intangibles, including $180MM amortized over 8–10 years.

Synergies and expected cost savings

• Annual pre-tax run-rate cost synergies of $30MM, ~7% of the cost base; one-time pre-tax integration costs estimated at $105MM.

• Cross-selling, securitization, capital and funding opportunities, including accelerated direct-deposit growth, offer additional potential value.