Canada’s Big 6 banks delivered another solid quarter, with beats led by Toronto-Dominion (TD) and Scotiabank (BNS).

As though the record’s on repeat, capital markets and wealth management were the largest contributors to growth…

… but credit drove the trading picture. Stock price reactions were mixed, with solid share price pops from Scotia and TD on improving credit…

… while National Bank (NA) fell the most amongst the Big 6 as delayed & lower than anticipated capital benefits from the CWB acquisition (lower credit quality) weighed on shares.

Beyond better credit, Scotiabank’s re-rating was likely helped by a 14% ROE arriving ahead of schedule (was a F2027 target). With higher return on equity across the board…

… valuations remain at historically elevated levels across the Big 6.

That said, it’s an open question whether these levels are here to stay, or if gravity re-asserts itself, as the banks continue to reiterate their resilience in the face of heightened uncertainty.

About Bullpen: Bullpen Finance Inc. publishes content on Canadian markets and provides paid research coverage of select Canadian issuers. Bullpen is paid in cash by covered issuers, does not accept stock or options, does not hold positions in covered securities, and does not conduct investment banking business. Bullpen and LodeRock Advisors Inc. are affiliated; LodeRock provides investor relations services to issuers, some of whom are covered by Bullpen Research. When a post discusses a covered issuer, a specific disclosure appears at the top of the post. This post is published for general information purposes. It is not personalized investment advice and is not tailored to any individual reader’s circumstances. Bullpen is not a registered investment adviser or dealer. For full disclosures, including analyst certification, jurisdictional statements, and conflict of interest policies, please see our Legal & Disclosures section on our website.

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