Bank Of Nova Scotia

Strong Q1 Earnings Performance: Scotiabank reported adjusted earnings of $2.2 billion or $1.76 per share, reflecting a 15% year-over-year growth in noninterest revenue. This performance highlights the strengthening of their client franchise and a favorable decrease in funding costs due to lower rates. Adjusted return on equity improved to 11.8%, signaling solid financial health.

Credit Losses and Provisions: Provisions for credit losses (PCL) remained elevated at approximately $1.2 billion for the quarter, primarily due to the impacts of higher interest rates and geopolitical uncertainties. The PCL ratio increased to 60 basis points, with guidance suggesting a trend towards lower provisions in the second half of 2025, assuming no significant macroeconomic deterioration or tariff impacts.

Investment Strategy and Capital Deployment: Scotiabank is actively reallocating capital towards priority markets, evidenced by the recent acquisition of a stake in KeyCorp and the sale of operations in Colombia, Costa Rica, and Panama. This strategic capital redeployment is expected to be capital neutral and accretive to earnings, showcasing their focus on growth opportunities.