Monday, November 30, 2020

Upstart bank Wealth One aiming for profitability amid trying times for Canada and China

Towers in Toronto

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While Leonard said Wealth One hasn’t really been affected by the geopolitical headwinds generated by the Huawei issue, as it is a Canadian-owned bank whose business is focused in Canada, the developments regarding Hong Kong could be having an effect on immigration and the financial decisions being made by newcomers.

“I suppose what we have seen over the last couple of years, and this is anecdotal, but it’s conversation with the people that we lend to, is they’re looking at moving more of their assets into Canada than they might otherwise have done, maybe on a more accelerated schedule than they may have intended in the past,” Leonard said. “I think it’s actuallSet featured imagey what’s going on in China itself that’s more of a driver.”

Leonard said his relationship with Wealth One goes back to 2013, when he helped with its business plan, and he joined the bank in 2018 as its chief financial officer. Prior to that, he was CFO of CFF Bank, which was acquired by Home Capital Group Inc. in 2015. He was also the founding chief financial officer of ING Direct Canada, which was bought by the Bank of Nova Scotia in 2012 and renamed Tangerine.

In other words, Leonard has experience in trying to run a “challenger” bank that competes with Canada’s Big Six, which dwarf lenders such as Wealth One.

But running a smaller financial institution can come with some growing pains.

Early on, Wealth One, which has had a handful of CEOs in its short life, became embroiled in a political controversy after the bank’s founder, financial-advisory firm president Shenglin Xian, went to a fundraiser that was attended by Prime Minister Justin Trudeau. At the time, Wealth One was awaiting regulatory approval to begin doing business, which it eventually received.

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