Somewhere in the Caribbean this year, a sign is coming down off a bank on a main street where it has hung for the better part of a century. The name on it is Canadian — Scotiabank, or CIBC — and its removal is a small, almost unremarked event that marks the end of one of the longest and least-examined relationships Canada has anywhere in the world. For a hundred years, Canada was the Caribbean’s banker. It is quietly getting out of the business.
The deals tell the story in the dry language of press releases. In May 2026, CIBC agreed to sell its roughly 92 percent stake in its Caribbean arm to Bermuda’s Butterfield for about 1.6 billion US dollars, with the transaction expected to close in the first half of 2027. Scotiabank, long the largest Canadian presence in the region, has been restructuring for a while — transferring its operations in Colombia, Costa Rica and Panama to the Colombian group Davivienda at the end of 2025 in exchange for a minority stake, and moving to take its Jamaica business private. The retreat is orderly, profitable, and, from a shareholder’s chair, entirely rational.
Why they are going
There is no scandal here, only arithmetic. In the first quarter of 2026, North America accounted for around 82 percent of Scotiabank’s earnings; the Caribbean contributed about 11 percent. For a bank deciding where to put its capital, that gap is the whole argument. The Caribbean is a collection of small markets, expensive to serve, heavy on regulation and compliance costs, and modest in return next to the opportunities at home. Canadian banks have spent recent years deciding, one by one, that the region is no longer worth the trouble, and redirecting the freed-up capital toward North American growth.
Layered on top is a quieter force the industry calls de-risking. In a world of tightening anti-money-laundering rules, large banks have grown wary of small, cash-heavy economies where the compliance burden is high and the reputational risk of getting it wrong is higher. Rather than manage that risk, many global banks have simply exited — withdrawing correspondent-banking relationships and shuttering operations across the developing world. The Canadian departure from the Caribbean is a regional chapter of a global retreat.
What the region loses
To understand why this matters, you have to see what a foreign bank actually is to a small economy. It is not just a place to keep money. It is the plumbing of trade finance, the source of mortgages and business loans, the correspondent link that lets a local bank move money internationally at all. For a hundred years, Canadian institutions were that plumbing across much of the English-speaking Caribbean, and their presence was itself a kind of stability — a signal that the region was banked, connected, part of the global financial system.
Their exit leaves a vacuum, and vacuums get filled. The question is by whom. Some of the business will pass to regional and local banks, which is in many ways healthy — a Caribbean less dependent on foreign institutions is a Caribbean with more control over its own financial life. Some will go to buyers like Butterfield. But there is a real risk that a region already vulnerable to de-risking finds itself with fewer international links, higher costs, and thinner access to credit — and an open question about whether non-Western capital, from China or elsewhere, steps into the space the Canadians are leaving.
None of this is hostile. The banks are not fleeing a crisis; they are optimizing a portfolio, and they have every right to. But it is worth naming what is being lost, because it will not announce itself. There will be no dramatic rupture, just a slow thinning — a sign down here, a branch closed there, a correspondent relationship quietly not renewed — until one day a relationship that defined Canada’s presence in the Caribbean for a century has simply, unceremoniously, ended. The other threads of that relationship are growing. This one, the oldest, is being wound up.