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The Institutional Risk Analyst

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Writer's pictureR. Christopher Whalen

Bank of Nova Scotia + KeyCorp = ??

Updated: Oct 9

August 14, 2024 | Premium Service | As August ends and the 2024 political season gets into full swing, we want to remind our readers of a 2020 comment by Achim Dübel in Berlin (“Achim Dübel: Geopolitical Risks of the 2020 Election”).

Many readers were surprised by Achim's blunt European perspective on the US as global military hegemon. As it turns out, Achim correctly predicted the slow demise of President Joe Biden and the ascension of Vice President Kamala Harris to the head of the party of war in the US:


“Harris was the first candidate to drop out of the Democrat’s race due to her profound unpopularity, but she was always the war network’s preferred candidate. I predicted in May that the US military industrial complex would push Harris through regardless. The popular contenders such as Senator Bernie Sanders (D-VT) and President Trump were axed away with the most unfair means to clear the path for Harris to reclaim control of the US for the war network.”


“Harris’ career is also well planned ahead. The demented and corrupt Joe Biden, who is easy to manipulate and blackmail, is for some the perfect profile of a politician. Biden will be kept as a kind of political hologram for the next four, maybe eight years, while policy will be run by Harris and the corporate networks she represents. And then she will become President herself. It is reasonable to expect Harris to run the country until 2032 or 2036. The war network appreciates continuity.”


Meanwhile, the luminaries who run the Democratic Party are planning to put former President Bill Clinton, former Senator Hillary Clinton, former President Barack Obama, and Joe Biden all onstage at the Democratic National Convention in Chicago. This is the one hideous image that could revive the struggling campaign of President Donald Trump.


“The campaign keeps talking about the future,” notes Marshall Auerbach on X. “Why bring up reminders of the past?”  Why indeed.


Scotiabank + KeyCorp?? Really?


Hope for the future is not just confined to the world of politics. KeyCorp (KEY) shares surged 9.1% yesterday, the top daily performance in the S&P 500, after the bank announced a $2.8 billion investment from Bank of Nova Scotia (BNS). The transaction will give Scotiabank a 14.9% stake in KeyCorp, a $190 billion regional lender and commercial real estate custodian. And now BNS suddenly plans to enter residential mortgage finance in the US.


It came as news to many that BNS CEO Scott Thompson is counting on $250 million in additional earnings from the investment by 2026. Really? We have a couple of thoughts on the BNS acquisition and the larger unwind of the world of mortgage warehouse lending below.

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