On August 12, 2024, Scotiabank entered into an agreement to acquire a 14.9% pro-forma ownership stake in U.S.-based KeyCorp for approximately US$2.8 billion (CAD 3.7 billion). The acquisition involved the issuance of common shares at $17.17 per share, an 11% premium to the 20-day volume-weighted average price. The transaction is structured in two stages: an initial 4.9% investment in fiscal Q4 2024, followed by an additional 10% investment in fiscal 2025. This strategic move is expected to enhance Scotiabank's earnings per share in the first full year post-closing.

Upon completion, Scotiabank will gain the right to appoint two directors to KeyCorp's Board. The deal, subject to regulatory approval, will be recorded as an equity investment initially, later reclassified as an investment in associate. The acquisition is anticipated to impact Scotiabank's CET1 ratio by 10 basis points initially and by an additional 40-45 basis points upon the final investment.

Bank of America and Scotiabank acted as financial advisors, with Cravath, Swaine & Moore LLP providing legal counsel to Scotiabank. Sullivan & Cromwell LLP advised KeyCorp.