National Bank of Canada

Strong earnings + capital generation (good) - Q3 2026 EPS: $3.39, +26% YoY. - Revenues: +18% YoY, supported by capital markets / wealth management / personal banking and balance-sheet growth. - Operating leverage: ~+6% (positive), while credit performance remained resilient. - ROE: 16.8% (and YTD ROE: 16.7%), on track to exceed the 16% ROE target for FY26. - CET1: 13.51%, supported by 41 bps capital generation; RWA expansion (19 bps) partially offset.

Margins: NIM pressured but expected to stabilize (mixed/surprising) - P&C banking NIM declined 7 bps sequentially (mainly from rapid personal mortgage growth and commercial deposit mix/seasonality). - All-bank NIM: +2 bps QoQ to 2.18%, helped by Treasury (+3 bps) and reclass/realignment effects (+4 bps); offset by the P&C margin decline. - Outlook for Q4: expect P&C margin roughly stable vs Q3 levels, and all-bank NIM relatively stable—but competitive deposit/loan dynamics remain a watch item.

Growth engine: mortgages + deposits strong (good, but strategy trade-off) - Loans: +11% YoY (and +4% QoQ), with record mortgage originations. - Deposits: +11% YoY (and +1% QoQ); personal demand deposits slightly down QoQ as client appetite shifts to investments. - Management emphasized mortgages are a key client acquisition vehicle and expect improved economics over time via cross-sell (deposits, credit cards, advisory). - However, investors challenged whether pursuing growth implies NIM erosion toward ~2%—management indicated peers’ comparisons aren’t apples-to-apples and suggested future retail transformation / product-mix changes could affect the path of NIM.