A customer walks out of a Canadian Western Bank branch in Calgary on June 9, 2009.Todd Korol/Reuters
Getting caught up on a week that got away? Here’s your weekly digest of the Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.
National Bank offers to buy Canadian Western Bank in deal valued at $5-billion
National Bank of Canada announced this week it is buying Canadian Western Bank in a pending stock-swap deal that values the Canadian Western Bank at $5-billion, or $52.24 a share, extending the reach of the country’s sixth-largest lender into Alberta and British Columbia. After the news, Western Bank’s shares soared, jumping 70 per cent to $42.35 in midafternoon Wednesday on the Toronto Stock Exchange. National Bank has been on a tear in recent years, with its share price surging 89 per cent in the past five years – making it the best performing Big Six bank stock – as it focused on expanding its business beyond Quebec and growing niche areas. Tim Kiladze writes that the deal is a no-brainer, but the price is hard to stomach.
The Canadian tech nerd wanted by French police for his phone encryption app
Paul Krusky is an unassuming tech nerd. An investigation from Joe Castaldo and Alexandra Posadzki tells the story of how he went from creating EncroChat, one the world’s many encrypted phone services to a French prison, accused of building a digital den for Europe’s drug dealers. The messages delivered by his company were encrypted end-to-end, meaning that no one – not even EncroChat – could decode the conversations. European authorities have taken the view that services like this are “grey infrastructure,” immune to traditional investigative techniques such as wiretapping, and with the potential not to co-operate with law enforcement requests. Not every user may be a criminal, the argument goes, but the level of criminality associated with these services is often so high that the companies themselves could be considered criminal enterprises.
No sign of an EV backlash among vehicle buyers in Canada
Tesla sales are tanking and other automakers are scaling back how many EVs they plan to build this year, but there is one bright spot in the industry, even if it’s not going to move the global needle on EV demand: Canadian consumers are still flocking to low-emission vehicles. In the first quarter, new vehicle registrations of EVs grew 53 per cent compared with the same quarter last year, even as new registrations of nonelectrics slowed, according to Statistics Canada. Jason Kirby takes a closer look at the figures in this week’s Decoder.
Household wealth jumps to record on stock rally
The recent stock market rally is padding the finances of Canadians, who have seen their collective wealth jump to record levels in the early months of the year, Matt Lundy reports. Household net worth rose by nearly $550-billion or 3.3 per cent during the first quarter of 2024, Statistics Canada said this week. Households keen to join the stock rally acquired nearly $24-billion in shares of pooled investment funds – mostly exchange-traded funds – in the first quarter, exceeding total acquisitions in 2023. Canadians have also reined in their borrowing as they contend with higher interest rates: Total liabilities rose by $8.7-billion to start the year, an increase of just 0.3 per cent.
For Geoffrey Hinton, machines are closer to humans than we think
As researchers at the world’s most advanced AI companies prepared to sign a public letter last week warning of frightening new developments in artificial intelligence, Geoffrey Hinton, the godfather of AI, e-mailed The Globe’s Ian Brown to ask if he wanted to have lunch. Hinton had supported and given input on but not signed the famous letter. “I want to talk to you about sentience in machines,” he said. Here’s what he told Brown about the future of AI, and read some previous reporting from Brown on the peril and promise of artificial intelligence.
The food fight for Swiss Chalet’s owner is a lesson for all family companies
Author Stephen Kimber’s latest book The Phelan Feud captures the bruising, years-long family battle for control of the Recipe Unlimited Corp, which owns restaurant chains including Swiss Chalet and Harvey’s. The battle pitted PJ Phelan and his son against two of his daughters, Gail and Rosemary. With full access to court documents and private family records, the book is filled with intrigue, betrayal and high-living, including family-backed yachts vying for the America’s Cup. It’s a story with poignant lessons for any family, with special relevance to the privately owned businesses that are major contributors to the country’s economy. Kimber spoke with Andrew Willis about the book and the family that was one of Canada’s wealthiest in the 1990s.
Editor’s note: A previous headline for this article inaccurately stated that Capital Bank is planning to buy Canadian Western Bank. National Bank is planning to buy Canadian Western Bank. This version has been updated.