LONDON, ON, April 7, 2021 / PRNewswire / – VersaBank (“VersaBank” or the “Bank”) (TSX: VB), a leader in digital banking and cybersecurity solutions, today announced that it has received the following senior credit ratings from Egan-Jones Ratings Company, a nationally recognized US statistical rating organization (NRSRO) and the National Association of Insurance Commissioners of the United States (NAIC Recognized Credit Rating Provider:
- “A” rating for the Bank as a whole; and,
- “A-” rating for the outstanding subordinated debt issue up to US $ 100 million.
VersaBank’s overall “A” credit rating is comparable to that of several of Canada’s “Big Six” Schedule I banks.
“This is a truly transformational event for VersaBank that will significantly expand our universe of depositors and open a new low-risk lending channel, providing the opportunity to further accelerate our growth in ways not previously available to us.” Said David Taylor, President and CEO, VersaBank. “Additionally, the Bank’s investment ratings are an external affirmation of our low-risk digital banking model, which is fundamental to our ability to drive earnings growth and shareholder value. ”
“It is important to note that VersaBank’s ‘A-‘ subordinated debt rating offers the Bank a new option for significantly less costly, non-dilutive and tax-efficient capital that was not previously available to fuel our growth – particularly beneficial These new ratings are particularly valuable as we explore the possibility of launching our innovative digital banking services in new geographic markets beyond Canada, where we see significant unmet needs similar to those that drove the strong, steady growth. “
VersaBank Global “A” rating enables a new low-cost deposit channel, significantly expanding the universe of depositors in Canada and the United States
The overall “A” rating assigned to VersaBank by a rating agency recognized by the National Association of Insurance Commissioners (NAIC) considerably broadens the universe of potential VersaBank depositors, allowing the Bank to offer a very attractive deposit alternative. attractive to institutions such as insurance companies and designated municipalities, among others, in Canada and abroad, which generally hold longer term deposits and are limited to holding deposits with blue chip financial institutions .
“The foundation of VersaBank’s superior profitability, low risk proposition is our ability to find deposits at low cost, which allows us to achieve the best net interest margins in the industry,” said Mr. Taylor. . “We recently set a new high for its cost of funds at 1.34% and the Bank’s new investment grade credit rating now allows large, long-term depositors to provide a significant additional source of funds at low cost. ”
VersaBank is a Canadian Schedule I chartered bank with a difference. VersaBank became the world’s first fully digital financial institution when it adopted its highly efficient business-to-business model using its proprietary leading edge financial technology to profitably respond to underserved segments of the Canadian banking market in pursuit of interest margins higher net. while mitigating risks. VersaBank obtains all of its deposits and delivers the majority of its loans and leases electronically, with innovative deposit and lending solutions for financial intermediaries that enable them to excel in their core businesses. In addition, leveraging its in-house developed computer security software and capabilities, VersaBank has established a wholly-owned, Washington, DC-based subsidiary, DRT Cyber Inc. Cyber threats challenge financial institutions, multinational corporations and government entities on a daily basis.
VersaBank’s common shares trade on the Toronto Stock Exchange under the symbol VB and its Series 1 Preferred Shares and Series 3 Preferred Shares trade under the symbols VB.PR.A and VB.PR.B, respectively.
Visit our website at: www.versabank.com
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