DBRS Limited (DBRS Morningstar) finalized its provisional rating of BB (high) with a Stable trend on Laurentian Bank of Canada's (LBC) NVCC Additional Tier 1 (AT1) Limited Recourse Capital Notes (Capital Notes).

Following the review of final documentation associated with the offering, DBRS Morningstar confirmed that the terms of the issuance are consistent with those reviewed at the time the provisional rating was assigned on April 30, 2021. For further details on the provisional rating, please see the DBRS Morningstar press release entitled 'DBRS Morningstar Assigns Provisional Rating of BB (high), Stable, to Laurentian Bank of Canada's NVCC Additional Tier 1 (AT1) Limited Recourse Capital Notes.'

LBC issued $125 million of Capital Notes on May 7, 2021. The Capital Notes mature on June 15, 2081, and will have an initial five-year fixed interest rate of 5.30%. DBRS Morningstar notes that the Office of the Superintendent of Financial Institutions granted Tier 1 capital treatment to the Capital Notes.

RATING DRIVERS

Over the longer term, a sustained improvement in the level of earnings and operating efficiency and the strengthening of capital buffers would result in an upgrade of ratings.

Conversely, material losses caused by operational difficulties as the Bank implements various organizational projects, sustained negative operating leverage, or significant losses in the loan portfolio as a result of unforeseen weaknesses in the risk management process would lead to a downgrade.

ESG CONSIDERATIONS

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

The Grid Summary Grades for LBC are as follows: Franchise Strength - Strong/Good; Earnings Power - Good; Risk Profile - Good; Funding & Liquidity - Strong/Good; and Capitalization - Good/Moderate.

Notes:

All figures are in Canadian dollars unless otherwise noted.

The principal methodology is the Global Methodology for Rating Banks and Banking Organisations (June 8, 2020; https://www.dbrsmorningstar.com/research/362170). Other applicable methodologies include the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (February 3, 2021; https://www.dbrsmorningstar.com/research/373262).

For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found on the issuer page at www.dbrsmorningstar.com.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar's outlooks and ratings are under regular surveillance.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com.

DBRS Limited

DBRS Tower, 181 University Avenue, Suite 700

Toronto, ON M5H 3M7 Canada

Tel. +1 416 593-5577

Ratings

Date Issued	Debt Rated	Action	Rating	Trend	Attributes

i

US = Lead Analyst based in USA

CA = Lead Analyst based in Canada

EU = Lead Analyst based in EU

UK = Lead Analyst based in UK

E = EU endorsed

U = UK endorsed

Unsolicited Participating With Access

Unsolicited Participating Without Access

Unsolicited Non-participating

07-May-21 	NVCC Additional Tier 1 (AT1) Limited Recourse Capital Notes	Provis.-Final	BB (high)	Stb	CA

(C) 2021 Electronic News Publishing, source ENP Newswire