Officials said nearly 20 founding members agreed after Canada-hosted talks; the bank was later confirmed for Montreal, with its charter still needing legislative approval.
The Defence, Security and Resilience Bank is intended to lower military borrowing costs by pooling credit strength and support long-term financing for members and partner countries' defence projects.
Canada says it will meet NATO spending goals, while allies have boosted rearmament since Russia's 2022 invasion of Ukraine; earlier reports said the project could raise $135bn and create 3,500 jobs.
With key allies skeptical, is Canada's new billion-dollar defence bank a masterstroke or a massive financial gamble?
As private capital gets set to fund military projects, is this the future of Western security or a moral hazard?