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Canadian Banks Report Mixed Q1 Results with Strong Capital Markets Performance

Major Canadian banks post profits exceeding analyst expectations, driven by capital markets gains, despite rising provisions for loan defaults and economic uncertainties.

A sign for the Royal Bank of Canada in Toronto, Ontario, Canada December 13, 2021. REUTERS/Carlos Osorio/File Photo
A sign for the Royal Bank of Canada in Toronto, Ontario, Canada December 13, 2021. REUTERS/Carlos Osorio/File Photo
Bank of Montreal, Bank of Nova Scotia and Royal Bank of Canada signage is pictured in the financial district in Toronto, Friday, Sept. 8, 2023. THE CANADIAN PRESS/Andrew Lahodynskyj
TD Canada Trust and RBC Royal Bank logos are seen on the outside of office towers in downtown Vancouver, on Thursday, January 19, 2023.

Overview

  • Canadian Imperial Bank of Commerce (CIBC) reported a 23% rise in adjusted net income to C$2.18 billion, supported by strength in its capital markets unit.
  • Bank of Montreal (BMO) posted a significant profit increase to C$2.1 billion, with adjusted earnings per share of C$3.04, surpassing analyst predictions due to robust capital markets activity.
  • National Bank of Canada recorded an 8% increase in net income to C$997 million, driven by trading and wealth management gains, though provisions for loan losses more than doubled year-over-year.
  • Scotiabank's adjusted profit rose 7% to C$2.4 billion, despite a reported net income decline due to impairment costs from the sale of Latin American operations as part of its strategic realignment.
  • Rising provisions for credit losses, attributed to economic uncertainty and geopolitical tensions, were a common theme across banks, reflecting cautious approaches to potential loan defaults.