BMO Reshapes Transportation Finance with Strategic Stonepeak Deal

The planned sale of its transportation and vendor finance businesses will give the businesses room to grow while allowing BMO to focus capital on its core markets

Toronto and Chicago, 7 October 2026 – BMO Financial Group is changing the structure of two specialized financing businesses through a strategic agreement with Stonepeak. The bank has signed a definitive agreement to sell its Transportation Finance and Vendor Finance businesses, including related loan portfolios in the United States and Canada.

The businesses have a combined loan and lease portfolio of approximately C$14.5 billion as of March 31, 2026. Transportation Finance provides financing for trucks and trailers, mainly through relationships managed by dealers, while Vendor Finance supports equipment purchases through original equipment manufacturers and their dealer networks.

Under the proposed transaction, Stonepeak will acquire the assets of both businesses for cash consideration, along with an earnout tied to future performance targets. BMO will reinvest part of the proceeds into the new entity, retaining an approximate 19.9 percent equity interest. This will allow the bank to maintain a financial connection to the businesses while using a more capital-efficient structure.

For the transportation finance sector, the transaction brings together two organizations with different areas of expertise. Stonepeak, an investment firm focused on infrastructure and real assets, has experience across sectors including transportation and logistics. The firm manages approximately US$88 billion in assets and plans to build on the existing platform, customer relationships, and leadership team.

BMO said the transaction is part of its broader strategy to improve capital efficiency and concentrate resources on areas where it has strong client relationships and long-term growth opportunities. Rather than completely stepping away from the businesses, the bank's retained equity position gives it an opportunity to participate in their future value creation.

The transaction is also expected to have an effect on BMO's capital position. On a pro forma basis, the bank expects its common equity Tier 1 ratio to improve by approximately 28 basis points, mainly because of a reduction in risk-weighted assets. BMO also expects the transaction to be accretive to return on equity, while saying it should not have a significant effect on future run rate earnings.

For customers, continuity will be an important part of the transition. BMO and Stonepeak have said they will work together to support a smooth changeover, with Stonepeak planning to build on the existing team's expertise and customer relationships.

The transaction is expected to close during the fourth quarter of BMO's 2026 fiscal year, subject to regulatory approvals and other customary closing conditions. BMO expects to record an estimated C$0.9 billion after-tax charge, primarily related to goodwill, although the final amount will depend on closing adjustments and foreign exchange rates.

The deal highlights how financial institutions are increasingly looking at specialized lending businesses through the lens of capital efficiency, scale, and long-term growth. For BMO, the strategy creates a path to remain connected to transportation and equipment finance while directing more capital toward its broader banking priorities.

For Stonepeak, the acquisition provides an established transportation financing platform with an existing customer base and industry expertise. Together, the transition could create a new structure for the businesses as demand for commercial equipment financing and transportation-related financial services continues to evolve.

• By Editorial Panel
• 09 Oct 2026