Bermuda-based bank clears major hurdle toward acquiring majority control of regional banking group.
The Bank of N T Butterfield & Son Limited has secured shareholder backing for one of the region’s largest banking transactions. At its virtual annual general meeting on Friday, Butterfield shareholders approved all four resolutions on the agenda, including the issuance of new shares required to acquire majority control of CIBC Caribbean Bank Limited in a deal valued at US$1.8 billion, according to the Jamaica Observer.
The Bermuda-based bank now moves toward the next critical phase: obtaining regulatory approvals from authorities across multiple Caribbean jurisdictions. These include the Bermuda Monetary Authority, Cayman Islands Monetary Authority, Central Bank of Barbados, Barbados Financial Services Commission, and regulators in other territories where CIBC Caribbean operates subsidiaries. Both entities submitted regulatory filings around mid-July, and Butterfield expects the transaction to close in the first half of 2027.
To strengthen its balance sheet for the acquisition, Butterfield plans to raise up to US$700 million in tier two subordinated debt financing, with underwriting commitments already secured from two investment banks. The financing is expected to occur in the fourth quarter of 2026 or early 2027, subject to market conditions. This capital raise would bring Butterfield’s total capital ratio to 19 per cent if the deal closes, down from 27.5 per cent as of June 30, though still above regulatory minimums.
Under the transaction structure, Butterfield will pay the Canadian Imperial Bank of Commerce US$1 billion in cash plus US$644.40 million in new Butterfield shares. CIBC would become Butterfield’s largest shareholder with a 22 per cent stake and the right to nominate two board directors. Butterfield also plans to acquire remaining minority stakes in CIBC Caribbean and its Bahamas subsidiary through takeover bids offering the same economic terms to minority shareholders.
The combined banking group would be a significant regional player, with pro-forma assets of US$29 billion, deposits of US$25 billion, and a deposit market share exceeding 50 per cent in the Cayman Islands. However, two ratings agencies have adjusted their outlook on Butterfield based on the deal’s scale. Kroll Bond Rating Agency moved Butterfield’s senior unsecured debt to watch downgrade status, warning that the acquisition would increase loan portfolio risk and potentially lower capital ratios, though it affirmed the A+ rating. S&P Global Ratings similarly revised its outlook on Butterfield from stable to negative while maintaining its BBB+ credit rating.
The Bank of N T Butterfield & Son Limited is a Bermuda-based financial institution that trades on the New York Stock Exchange under the ticker NTB. CIBC Caribbean Bank Limited is a regional banking group with operations across multiple Caribbean jurisdictions, currently owned by the Canadian Imperial Bank of Commerce.
This transaction significantly reshapes Caribbean banking architecture, affecting deposit holders and financial services customers across multiple territories including the Cayman Islands, Barbados, and the Bahamas. The deal’s regulatory approval process involves central banks and financial authorities throughout the region, and the combined entity’s market dominance—particularly the 50 per cent-plus deposit share in the Caymans—will influence regional financial stability and competition.
Written & Edited by Orlyn Edwards. Published by Caribbean Air Force Media.
Category: Business · Island routing: Jamaica