BNS expands its fintech expertise

BANK OF NOVA SCOTIA $63 (Toronto symbol BNS; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.2 billion; Market cap: $75.6 billion; Price-to-sales ratio: 3.3; Dividend yield: 4.6%; TSINetwork Rating: Above Average; www.scotiabank.com) has formed a new alliance with Kabbage Inc. This firm makes software that automates and speeds up online financial transactions (generally called “fintech”).

Under this partnership, Bank of Nova Scotia will let customers in Canada and Mexico apply for small business loans up to $100,000. Using Kabbage’s technology, they will receive a decision in about seven minutes.

Teaming up with a fast-growing firm like Kabbage is easier than developing a new platform. It should also give Bank of Nova Scotia an edge over competing banks in Canada.

Bank of Nova Scotia is a buy.

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